How To Buy Vacation Houses On A Budget

Dreaming of that vacation home in the Keys? Or maybe a second home in the Georgia woods? Or maybe you want to buy a condo on the beach?

If you’re willing to rent your vacation home at least a third of the year, then you can manage to buy it and pay for taxes and insurance.

So says Christine Hrib Karpinski in her two books on renting vacation homes. She will be at the new Hudson Miami Bookstore at Miami International Airport at noon Wednesday to discuss how to afford a vacation home even if you’re on a budget.

She recommends you rent out your second home for at least 17 weeks a year to pay the bills.

“You’re using that as a means to an end — to be able to afford a vacation home,” she said in an interview from her Austin, Texas, home.

That’s what she did years ago when she bought a vacation condo in Destin while they were living in Atlanta.

Since then, she has invested in other vacation homes, in Georgia, Tennessee and elsewhere.

“In fact, people who otherwise would not be able to buy a vacation home can, indeed, if they learn the right techniques of renting by owner,” she writes in her self-published book How to Rent Vacation Properties by Owner: The Complete Guide to Buy, Manage, Furnish, Rent, Maintain and Advertise Your Vacation Rental Investment ($26).

The book was so popular that she gained a publisher, Kaplan Business, for her second book, Profit From Your Vacation Home Dream: The Complete Guide to a Savvy Financial and Emotional Investment ($19.95).

“This is not for the wealthy only, and it’s certainly not a get-rich-quick scheme. It’s a time-proven strategy that almost any middle-income family can use effectively,” she said.

She recommends that buyers do their homework. A home’s “location, size, and condition,” she writes in her first book, “are important serious issues.” Tourists usually want a view — unless they can rent a home for much less, she advises.

Buyers of second homes must also make a long-term commitment. Forget about flipping a home in less than a year.

While she says real estate remains an excellent investment, the “hot” times of double-digit jumps in home prices are over for most of the country.

Rather, buyers should plan to hold second homes for years to ensure a healthy profit.

With that in mind, people should make sure they have money socked away for personal emergencies. Consider: Would you be able to cover two mortgages in a pinch if the renting of your vacation home was slow? Or you lost your job?

Karpinski advises that one week’s lease on a home should equal one month’s mortgage, taxes and insurance. In another words, if the mortgage, property taxes and insurance equal $1,650 a month, then the home should be rented out for $1,650 during a peak week.

“Other costs, including bills for your phone, power, cable and association dues, are paid by your earnings from approximately five off-week rentals. So, even by renting only 17 weeks out of the year, you can still break even,” she writes.

It might be easier to hire a management or realty company to find renters, but realize you will give them a hefty share of the fees, Karpinski says. Then, you would have to rent your home more or end up footing some of the mortgage cost, she says.

A better way is to set up your own website and advertise in places where your would-be renters would look — from a hiking magazine to a popular website, she recommends.

There are now several websites that advertise rental vacation homes for owners. Karpinski is a director of one of them, the Austin-based

A management company comes in handy for overseeing day-to-day maintenance or the amenities. For that reason she recommends condos as second homes. A board and management company will do the heavy lifting of caring for the building, she says.

Also, she says, less is more: A three-bedroom home will attract more vacation buyers than a five-bedroom house.

Pets might not seem like a good idea but Karpinski says you can charge more per day if you allow pets. Owners who want their pets with them usually have well-behaved dogs, she says.

“Vacation properties that accept pets increase their occupancy by 10 percent to 50 percent,” she adds.

She used to advise not buying a home farther than six hours away by car.

But she has changed her mind after she moved from Atlanta to Austin and found she could still rent and manage their vacation homes long-distance.

“In fact, it is easier to be further away,” she jokes. “I really can’t micromanage.”

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