- Joined
- Aug 30, 2007
- Messages
- 13,881
I love Maui .. and have been there many times .. buying a 2BR condo or house always has intrigued me .. but does it really make sense ?
Indeed buying foreign / vacation properties make sense only if
a) you go there regularly (say 2x/year .. for many years to come)
b) you go there for an extended period .. say 3-4 months
c) you can pay in cash
d) you have enough other income that the opportunity cost of this cash doesn’t bother you
e) you are aware of tax implications while holding
f) you are aware of tax implications on exit
g) you know all true operating/holding costs such as
i) it is secure if you are not there / it is empty
j) you have seen it in both off- and in-season .. and see both aspects of it
k) there is demand for resale/used properties of this type
l) it is attractive to rent out (if this is your intention)
m) there is a capable, non-corrupt manager to manage complex or unit when rented or just as an owner complex
n) you have rented there a few times, and have decided that owning is a better option and understand a) to m) thoroughly
There are things in life you should own, say your shoes or your jacket or your car or your fridge. Things you use a lot. Other things, those you use little, should be rented, say a tuxedo, or a cab ride, or a hotel room or a vacation property !
Since I also like Cabo, Laguna Beach, Venice (both CA and Italy), Palm Springs, Florida Keys, St. Lucia, Vancouver Island, PEI, St. Tropez, Costa del Sol , Nice, Ruegen, Sylt and a few others I forget .. we decided (for now) not to buy but rent from the savings of not investing in a condo in Maui !
Your thoughts ? too rational ? Your experiences ?
Indeed buying foreign / vacation properties make sense only if
a) you go there regularly (say 2x/year .. for many years to come)
b) you go there for an extended period .. say 3-4 months
c) you can pay in cash
d) you have enough other income that the opportunity cost of this cash doesn’t bother you
e) you are aware of tax implications while holding
f) you are aware of tax implications on exit
g) you know all true operating/holding costs such as
- property taxes
- condo fees
- maintenance fees (if not condo) such as gardener, pool boy, cleaner
- frequent interior replacement costs for rotting couch due to mold or termites or salty sea air, stolen TV or carpet insurance utilities incl. telephone or internet travel cost to get there
i) it is secure if you are not there / it is empty
j) you have seen it in both off- and in-season .. and see both aspects of it
k) there is demand for resale/used properties of this type
l) it is attractive to rent out (if this is your intention)
m) there is a capable, non-corrupt manager to manage complex or unit when rented or just as an owner complex
n) you have rented there a few times, and have decided that owning is a better option and understand a) to m) thoroughly
There are things in life you should own, say your shoes or your jacket or your car or your fridge. Things you use a lot. Other things, those you use little, should be rented, say a tuxedo, or a cab ride, or a hotel room or a vacation property !
Since I also like Cabo, Laguna Beach, Venice (both CA and Italy), Palm Springs, Florida Keys, St. Lucia, Vancouver Island, PEI, St. Tropez, Costa del Sol , Nice, Ruegen, Sylt and a few others I forget .. we decided (for now) not to buy but rent from the savings of not investing in a condo in Maui !
Your thoughts ? too rational ? Your experiences ?
