Many of us in Morris, Essex and Union Cos. in New Jersey enjoy a change of scenery during our summer downtime. Whether it’s a short day trip to the shore or NYC or a vacation further afield, visiting another place always makes me long for a second home. When I travel somewhere, I daydream about what it would be like to live in this location, retire there or own a weekend place. I love checking out the gyms, supermarkets, restaurants and, of course, looking at real estate when I go away– I can’t help myself– and I bet many of you do the same.
Is owning a second home a smart choice for you? Some things to consider:
- Can you afford to make a second home purchase?
- How well do you know the area? Have you spent significant time there, not just a week here and there?
- What will the opportunity cost of spending extra disposable income on a second home be for your other expenses- like travel or savings?
- How will you finance the purchase?
- Is owning more real estate a good way to diversify your assets?
- Will the property be used primarily for your own enjoyment or as a rental property to generate income?
- What will the tax implications of owning a second home be?
- What will the ongoing maintenance and carrying expenses be?
- How will you manage the property?
- Are there any local restrictions on renting the property out?
- What is it like living in the location year round and in the off season?
- How convenient is transportation to and from the location?
- How will environmental changes impact this location?
- How accessible is medical care in that location?
Interestingly, a new Ameriprise Financial survey of financial advisors who work with high-net-worth clients estimated that about 2 out of 3 own a second home — and one-third of those who don’t already say they’re interested in acquiring one in the future. One of the most common financial reasons for purchasing a second home among high-net-worth individuals is that they plan to eventually move into the home full-time during retirement — the survey found that 33% of high-net-worth clients that currently own a second home plan to make it their primary residence in the future.
The bottom line is there is no clear pattern of where people are buying second homes or the factors which lead them to their new home towns. Each person’s decision is so unique. There are many lists of “the best places to live” or retire to– but what is best for someone else might not be right for you.
So far this year our team has had local families buy in Delaware, Upstate New York, Maine and South Carolina with an eye towards retirement. Some choose their next location based on being closer to their kids. We had one family move from Massachusetts to Maplewood for this reason and another family is moving to Oregon for the same.
Speaking with your financial advisor, accountant and realtor can help you put the pieces of the puzzle together. Our extensive network of top agents around the US can be a huge help to you if you are exploring your options for a purchase in any market. Consider us your connection to the best and feel free to reach out for an introduction to a great agent who can help you understand the market anywhere you are dreaming about.
If you are thinking of buying a second home in 3 months or 3 years or somewhere in between please reach out to us for advice at [email protected]. There’s nothing more exciting for me than hearing about your plans and dreams and I’d be happy to share my expertise with you.
The Allison Ziefert Real Estate Group is a top producing real estate team based at Compass in Short Hills, NJ. We are local market experts, specializing in real estate and homes in Maplewood, South Orange, Millburn/Short Hills, Montclair/Glen Ridge, West Orange, Morristown and the surrounding NJ towns. We’ve also got you covered coast to coast with the best connections to top agents around the country in any market you are exploring. We are driven by earning great testimonials and referral business from happy clients. You can read our reviews here.