Should You Buy a Second House?
Despite issues like the recession, second-homeownership has actually grown by 30% since the year 2000.
That’s a significant jump. And you may be wondering whether you should become one of the increasing number of people who are choosing buy more property.
After all, your first home is one of the best investments you could make. Why would your second home be any different?
There are several financial advantages tied to buying a second house. Let’s break them down now:
You likely already deduct your mortgage from your income tax return, but did you know there are extra advantages available to second home owners?
Until tax year 2016, tax savings were available under Sections 24 B and 80 C of the tax code.
The savings allowed you to save tax money on both the principle loan (80 C) and the interest (24 B).
You’re also protected in the case of property depreciation, which allows you to deduct 3.636% of the purchase price per year.
Finally, if you find you’re spending more time at your second home than you anticipated, you might be able to sell the home at a profit without paying taxes on the income.
Thinking about buying a second home but don’t want to live there full time?
You could make back your mortgage every month by renting or leasing it out monthly or over the long term.
The added income means you can pay off the mortgage from money outside of your salary while still enjoying the growth in value as your second property appreciates over time.
As the property value grows, you can even raise the rent, and it could become a valuable stream of secondary income.
Prepare for Retirement
Whether you’re 30, 40, or 60, there’s no wrong time to start thinking about what life will be like when you’ve stopped working.
Buying and paying for a second house before you retire allows you to avail of the tax benefits now and own the property before you retire.
You’ll have an opportunity to own a home in an up-and-coming area without missing out on the reasonable prices now.
It also provides you with a bit of extra time to change your plans in the event that life takes an unexpected turn.
Freedom to Travel
Is there a special place in your family’s heart? A place you visit one or more times per year every year?
Buying a second home your family’s place to travel ultimately proves you with more freedom to travel there.
By owning a home, you’ll never be caught out on expected hotel prices and your favorite vacation rental will never be booked up.
You’ll even be able to pass on the property to your kids to keep your family memories alive and well in the years to come.
Where Will You Buy Your Second House?
Whether it’s Maui or Bel-Air, the place you buy your second home should be financially prudent and emotionally valuable.
Are you ready to buy your second home? Powerhouse Real Estate offers you a competitive advantage over other buyers by looking for properties that offer great investment potential.
Request your free list of homes today.