Investment Properties

The idea behind purchasing a second home is that the buyer can resell the home at a greater value for which he bought it. This appreciation, in an ideal economic climate, can make the buyer thousands of dollars. However, it can be difficult to determine if you are really purchasing an investment when you purchase a second home. You have to make sure you can afford the mortgage and other real-estate maintenance expenses before considering a second home. Your Alliance One Real Estate Professional will make sure the following equity conditions are in place before you make your purchase.

The Right Location
Make sure you are looking in areas you know are growing in value.

Determine the Equity Climate
Buying a second home when equity is at an all-time low is not a good idea. Purchase your home when more people are investing in equity.

Take Care of the Home
After you purchase your second home, don't let it gather dust. If needed, fix it up or renovate it so it will accrue more value.

Wait Before Reselling
In order for your second home to appreciate, wait at least 2 years in order for your equity to appreciate. Waiting longer usually means that your home will gain more value, though it also carries the risk that the home will depreciate if there is an economic downturn.

Rent It
While you wait for your second home to appreciate, you can make money on it by renting out the home to tenants. Your Alliance One Real estate professional can also help you with property Management.

Know Your Payments
Owning a second home usually means you'll have to take out a second mortgage. Make sure you can afford the mortgage down payment and interest rate, as well as the taxes, legal fees, extraordinary expenses and maintenance costs you'll pay on your second home.