of Lloydminster

Your Community Minded Realtors

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Office: 780-808-2700
Toll Free: 866-666-2700
remaxlloydminster@gmail.com

RE/MAX Of Lloydminster
5726 - 44 Street
Lloydminster, AB
T9V 0B6

"each office independently owned and operated"

 

Everyone looks forward to a vacation, and many people return to their favorite spot each year. If you really enjoy your annual destination, you might be ready to invest in a vacation home. There are many practical reasons to consider purchasing a second home in a popular tourist area, in addition to the fact that it is your favorite places to visit.

Reduces Vacation Costs

The biggest expenses related to a vacation are the daily hotel rate and dining out three meals a day. While some hotels offer a breakfast buffet, you are responsible for your own lunch and dinner. A family of four can easily spend $75 a day on food and $125 for a hotel. Some highly popular tourist areas can cost twice as much. When you have your own property, you can limit your eating out to only the times you prefer. Your monthly mortgage payment eliminates the need for a daily room expense. You are left with more money for traditional vacation activities and shopping.

Rent Your Vacation Home For Extra Income

The months that you are not enjoying your vacation home provide opportunities for extra income that can be applied to paying the mortgage off quickly. It is unlikely that you can rent your property every week you are not there, but you can rent it enough weeks of the year to make a sizable reduction in your loan. The National Association of Realtors says the most desirable rental locations are "near oceans, lakes or rivers, or at mountain recreation areas."

Choose An Easily Accessible Location

When your vacation home is only three or four hours from a major city, more vacationers will be interested in renting your property. Accessibility is key for vacation rentals, and having well-marked roads in good repair is essential. While you may be able to rent the cabin that requires an all-terrain vehicle to reach it, there will not be as many people interested in staying there. Renters want to be less than 30 minutes from shopping, food, and entertainment while vacationing.

Income Tax

If you choose to rent your home out, be prepared to submit any rental income on your yearly income tax form.  There will be a number of deductions you can take so be sure to keep all receipts.

Having a vacation home is a great way for families to spend less on daily expenses. Generating extra income from renting the property helps pay the mortgage, taxes, and insurance. Someday your vacation home may become your retirement home, and it can be mortgage-free.

 

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Whether you are looking to purchase a home in the next two years or you intend to wait another five, you must find a way to save up enough money to use for a down payment. Without the money to make a deposit on a house, it isn't likely that anyone will accept your offer to purchase their home. It’s likely you won't be able to qualify for a mortgage either unless you have a tidy sum of money for a down payment. Here is a look at several strategies you can use to help you amass a sizeable down payment for your home purchase.


Sell Your Car and Take Public Transportation

If you don't need your car because you can walk or take public transportation to work, you might want to sell it. Having a larger down payment can keep your mortgage payment affordable enough to allow you to take on a car loan once you've purchased your home.

Stop Renting

Your monthly rent is probably the biggest expense that you have. If your lease is up, move back in with your parents or crash at a friend's place for the next year or two. Negotiate so that you don't have to pay any rent while you are staying there. For example, you can volunteer to mow the lawn, clean the house, and run errands. Take the money you save and place it into a savings account that you can use for a down payment.

Discontinue Cable TV, Premium Services, and Shopping Subscriptions

Discontinue all non-essential services and subscriptions, no matter how small the cost might seem. If you have to pay a membership fee, then you should unsubscribe. You probably do not need the service for the next couple of years. Plus, if you miss the service, you can always sign up again once you purchase your home.

Save Monetary Gifts, Bonuses, and Tax Refunds

While the extra cash might provide you with the pleasure of buying something you want but don't actually need, you should set it aside for the day you plan to buy your home. You can always make the purchase another time.

Become a Minimalist

Stop buying items that you do not actually need. For example, you can get creative and use shopping bags to wrap gifts and junk mail for scrap paper. Basically, if you don't absolutely need the item, simply do not purchase it.

Sell Off Collections

If you've been an avid collector of comic books, antiques, or some other valuable commodity, now might be an advantageous time to sell your collection. The money can increase the size of your down payment considerably, allowing you to purchase your home in a more timely fashion.

Avoid Expensive Dates, Vacations, and Meals

While it might be enjoyable to go on an expensive vacation or to dine out every weekend, the cost is going to make it that much harder to save up the money you need to buy a home. Whenever possible, avoid expensive recreational activities so that you can put the money to better use.

Use Coupons and Discounts

While it can be annoying to look for discounts and coupons, show them on your phone, or print them out, doing so can save you lots of money. You can take the savings and set it aside for your down payment. Don't fool yourself into thinking that an extra five dollars here and there isn't going to matter. Every cent that you save is one that you won't need to find later.

The size of your down payment is going to influence your ability to obtain a mortgage - as well as the size of your monthly obligation. Making a conscious effort to save money to use as a down payment is going to allow you to amass a larger sum than if you simply put away fifty dollars from each paycheck. Try to save money using as many ideas as possible so that you optimize your ability to achieve your goal of saving up for a large down payment on a home.


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