Vadala Real Estate | Gloucester Real Estate, Rockport Real Estate, Manchester Real Estate


Purchasing a second home should be a fun, exciting experience. Yet homebuyers who fail to consider where they want to pursue a second residence may struggle to achieve their desired results.

If you know you want to buy a second home, it often helps to narrow your house search to residences in a select group of cities and towns. Then, you can evaluate available residences in your preferred cities and towns and boost the likelihood of finding a house that you can enjoy for years to come.

Of course, determining which cities and towns where you want to pursue a second house can be difficult. Yet there are lots of things you can do to hone your house search, including:

1. Evaluate Your Homebuying Budget

Your finances likely will play a major role in your ability to pursue and acquire a second residence. As such, you should examine your finances closely so you can establish a homebuying budget.

If you have paid the mortgage on your current house, focus on the mortgage costs associated with a second home. For example, if you want to find out how much you can afford to pay for a second home, you can meet with bank and credit union mortgage specialists. This will allow you to get pre-approved for a mortgage so you can enter the real estate market with a budget in hand.

Comparatively, if you still have a mortgage on your present house, you should consult with your lender. This will allow you to determine if you qualify for a second mortgage. Also, you can get financial guidance so you can figure out where to search for a second house that falls in line with your finances.

2. Establish a Homebuying Timeline

Think about when you want to acquire a second residence. Next, you can create a homebuying timeline to help you achieve your desired homebuying goal.

A homebuying timeline should remain flexible. If you want to purchase a second home in the mountains, for example, you should account for the time it may take to transport various personal belongings to this residence. And if problems arise that delay your efforts to acquire a second home, you should be ready to adjust your homebuying timeline as needed.

3. Hire a Real Estate Agent

Let's face it – buying a second home is rarely simple, regardless of your property buying expertise. But if you hire a real estate agent, you can receive extensive assistance as you search for a second residence.

A real estate agent understands the ins and outs of the housing market. He or she will share real estate market insights with you, along with providing tips and recommendations. As a result, a real estate agent will help you find a second home in your preferred city or town as quickly as possible.

Take the guesswork out of finding and buying a second home in the city or town of your choice – use the aforementioned tips, and you could streamline your quest to acquire a second residence that matches your expectations.


This Single-Family in Beverly, MA recently sold for $275,000. This Bungalow style home was sold by Office Vadala Real Estate - Vadala Real Estate.


32 Ellsworth Ave, Beverly, MA 01915

Single-Family

$275,000
Price
$275,000
Sale Price

5
Rooms
2
Beds
1/1
Full/Half Baths
**SHORT SALE**SOLD AS-IS**PRICE NOT YET APPROVED BY LENDER**PROFESSIONALLY NEGOTIATED BY THIRD PARTY**




 Photo by Alexander Zvir from Pexels

Those who currently own a home may consider investing in a second home for income purposes. However, it is important to understand you may have hurdles to overcome when searching for a mortgage or obtaining homeowners insurance. Here are some of the most significant differences between buying an investment property and a primary residence.

Obtaining a Mortgage

In nearly all cases, mortgage rates for investment properties are higher than when you buy a primary residence. The reason for this is that lenders tend to view an investment property as a riskier loan than a loan provided for an owner-occupied property. Lenders may also impose more stringent requirements on debt-to-income ratios and credit scoring.

The news is not all bad because while a lender may have stricter debt-to-income requirements, a portion of your anticipated rental income may help offset the change.  Not all lenders will include potential rental income, but it is worth asking about. If your mortgage lender is willing to use the rental you expect to collect as part of your income it is likely they will use a percentage of the rent, less potential repair costs, and vacancy costs.

Down Payment Requirements

Typically, if you are purchasing an investment property, the lender will require you to make a larger down payment. In many cases, you may be required to put down as much as 25 percent of the purchase price. The good news is that unlike with the purchase of a primary residence, you may be able to borrow the down payment. However, this will have an impact on your debt to income ratio because you will be paying another loan.

Greater Reserve Requirements

Your mortgage lender may have a reserve requirement when you purchase a primary residence. Reserves are generally to ensure you have an emergency fund for things like unexpected repairs. When you seek financing for an investment property your mortgage lender may require you to have a larger reserve in case your rental income decreases unexpectedly.

Potential Tax Consequences

If you are considering an investment property, you should also understand there are certain tax benefits and drawbacks. Unlike a primary residence, you will have to claim the income generated from the property. You may also get some important tax breaks so it is a good idea to talk to a tax specialist about tax issues you may face.

If you are considering investment property as a means of generating additional income and building future equity, make sure you understand the hurdles you may face. Your real estate agent can help you learn the rental history of the property, neighborhood details, and other information you should know before making this important decision.


This Commercial in Gloucester, MA recently sold for $335,000. This style home was sold by Office Vadala Real Estate - Vadala Real Estate.


131 Main, Gloucester, MA 01930

Commercial

$399,000
Price
$335,000
Sale Price

1
Buildings
Commercial
Type of Comm.
1,010.00
Lot Size
This is an iconic Main St building with a corner location and high visibility. It has been operated as Larsen's shoe store for over 60 years. Heat is forced hot air by gas--there is also AC. The roof was replaced about 12 years ago. There will be an Open House from 1pm to 5 pm on Tuesday, October 20th. Offers will be due Thursday, October 22, 2020 by 5 pm.

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6 Arthur Street, Gloucester, MA 01930

Single-Family

$359,900
Price

6
Rooms
3
Beds
1
Baths
Move right in to this well maintained 3 bedroom home with an updated kitchen and bathroom. The kitchen has plenty of natural light with a large picture window overlooking the private fenced in back yard. The yard has a new fence and built-in fire pit to enjoy most of the year in our beautiful New England town. There is plenty of storage with a full basement and walk up attic. Conveniently located near historic downtown Gloucester Harbor, the MBTA and Burnham's field playground
Open House
Sunday
November 22 at 12:00 PM to 2:00 PM
Covid protocol such as social distancing and mask required.
More Open Houses
Cannot make the Open Houses?
Location: 6 Arthur Street, Gloucester, MA 01930    Get Directions

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