MAKE MONEY FROM HOTELS

Vacation Homes - Take
Advantage Of Home
Prices
With the housing market
down, now may be a good
time to think about buying
a second home. Investing in
real estate still can be
profitable. Not only are the
current prices low but if
you can turn it into a
rental, you could end up
making a monthly profit
on the home - depending
on how much it is rented.
To get the best possible
deals, check with the banks
for a listing of foreclosed
properties. Just be careful
of the condition that some
of these properties may be
in.
Since it would be much
riskier to invest in real
estate with the idea of
flipping for a profit right
now, keeping a property
long term as a rental is
ideal. When the market
goes back up you can
decide if you want to hold
on to the rental or sell for
a profit at that point.
To make your vacation
home pay for itself, rent it
out as often as possible.
This doesn't mean you
won't get to use it yourself.
Vacation rentals can take
in a high weekly rent,
especially if the home is
located in a prime area.
You may even want to
consider buying a vacation
home in another state
where housing prices are
extremely low such as
Florida, California and
Arizona. Since these are
also popular vacation
areas, your potential for
profit is greater, although
hiring a property manager
would probably be
necessary and should be
factored in.
You will want to take
advantage of this property
as much as possible.
Besides the income you will
bring in from rent, there
are some expenses that you
can offset against this
income.
Offsetting expenses:
Deduct mortgage
interest expense - you
must use the home 14
days out of the year, for
personal use, or 10% of
the total days the home
was rented out -
whichever is longer for
the home to qualify as a
second home. You can
only deduct the
mortgage interest
expense if your home
qualifies. This is an
expense that can be
deducted regardless of
the amount of rent you
bring in, it is simply a
second home expense.
Obviously there will be
rental income to claim.
You can deduct any
expenses related to the
property though at the
percentage the home
was used for a rental.
So, if the home was
rented 85 days in one
year and you used it 15
days, the percentage
would be figured at
85/99 (total days of use)
or 86%. If you have a net
profit, you can deduct
all of your expenses. If
you have a net loss, you
are limited. You cannot
claim a loss over rental
income but you can
carry over the loss to the
following year. This is
because rental expenses
cannot offset other
areas of income.
Homework Before Buying
Before buying that cabin or
cottage you fell in love
with, it is important to do
your homework. First of all,
you will want to prequalify
for a loan. There is no
sense in getting
emotionally involved if you
don't even qualify. Most
banks or financial
institutions have online
mortgage applications. This
makes it very easy to find
out where you can get your
best mortgage and rate. A
low mortgage means more
profit from rent. Right now
especially, you may be able
to take advantage of some
creative financing, maybe
even some no money down
options. With so many
properties on the market, it
doesn't hurt to throw some
crazy offers out there. If
you are looking at a
foreclosed property,
chances are that a bank
isn't going to want to hold
on to it.
Property taxes are probably
the next biggest expense
after mortgage. Make sure
you know ahead of time
what the taxes will be at a
non-homesteaded rate.
Next shop for homeowners
insurance. Like banks, most
insurance companies will
give you an online
insurance quote. Shop
around for the best quotes.
Along with homeowners
insurance, you may also
want to consider landlords
insurance. This will protect
you from damages incurred
by renters or injuries that
may happen on your
property. Again, check
online for an instant
insurance quote.
Other things to consider
are the utilities - how
expensive is heating? Will
you rent it year round? Try
to make an accurate
estimate. Then there are
advertising fees. Will you
advertise on the web? In
newspapers? Local bulletin
boards are a good low cost
option.
Do you need to make any
repairs to the home you
are buying? Make sure you
include these expenses in
determining the overall
value of the investment.
Maybe you got a great deal
on a foreclosure but if you
have numerous repairs you
may be better off with a
different property.
Once you have all of your
expenses figured, check
comparable vacation
homes in the area. What
are they getting for rent?
What amenities do they
offer? Now you are ready
to start shopping for your
perfect vacation home.
Tips From A Renters
Perspective
Watch the video for some
great tips on what renters
should be watching for in a
rental vacation home. This
is a great guide on how to
structure your rental
property in a pleasing and
professional way. You want
to give a great impression
and have a reputation that
will bring back repeat
renters. Following these
tips will put you on the
road to success.
Rental Home Or Duplex
A full time rental home
can bring you in a nice
steady monthly income. If
the rent you bring in is the
same or higher than all of
your expenses, then it is a
good investment. With
home prices down and
mortage rates low, now is a
good time to buy.
Make sure the home is
sound: One thing you do
not want is to be sticking a
lot of time and money into
repairs. Make sure you have
full inspections done and
know what you are getting
into. As a landlord, it will
be your responsibility to
keep up on repairs.
Renters: Interview,
interview, interview! I know
this from experience. This is
not the time to become
emotional with the family
with four kids who
desperately needs a home
and you have a two
bedroom place for rent.
Especially when you know
they are two weeks into
their sixth job...Help them
in other ways but do not
rent them your home. I
guarantee it will not work
out. It is very important to
check out their references.
After one bad experience,
we became very careful
and never again had a
problem.
Duplex for a first time
investment: A duplex is a
great way to go for a first
time rental. My husband
and I bought a duplex,
when we were first
married, and it got us
launched off in the right
direction. The first
advantage is that if you live
in one side and rent out
the other, which is what we
did, you can get a less
expensive mortgage.
Another obvious advantage
is the rental income. The
rent we made paid for our
mortgage. We basically
paid for taxes and
insurance. Since the duplex
was brand new, there
weren't any repairs.
Anything we bought for
the duplex to maintain it,
such as a lawnmower, we
claimed as an expense. I
would highly recommend
buying a duplex if you can
manage income and
expenses and can deal with
people.
Vacation Ideas
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Helpful Books
How to Rent Vacation
Properties by Owner
Second Edition
Amazon Price: $16.07
List Price: $26.00
Breaking all the Rules: How
to Rent Your Vacation
Home Includes Welcome
Book and Property Listing
Amazon Price: $16.97
Twitch Of The Death Nerve
(a.k.a. Bay Of Blood)
Amazon Price: $92.86
List Price: $24.99
Quicken Rental Property
Manager 2.0 [Old Version]
Amazon Price: $99.99
How to Make Your
Vacation Property Work for
You!: The Quick & Easy
Guide to Advertising,
Renting, Managing, and
Making Money from Your
Second Home (Revised
Edition)
Amazon Price: $89.95
List Price: $99.95
How to Rent Vacation
Properties by Owner
Second Edition
Amazon Price: $9.99
The Complete Guide to
Second Homes for
Vacation, Retirement, and
Investment
Amazon Price: $2.07
List Price: $24.95
The Second Homeowner's
Handbook: A Complete
Guide for Vacation,
Income, Retirement, And
Investment
Amazon Price: $21.95
Mortgage Interest Rates
- In The News
Mortgage rates fall on
tame inflation
Bankrate.com
22 hours ago
Mortgage interest rates
fell slightly this week,
relieving homebuyers of
the fear that last week's
surprising jump might
have launched an
immediate upward
trend, but leaving
homeowners less
enthusiastic about
refinancing their existing
loans.
Mortgage Rates Jump
Up in Week
ThirdAge
37 hours ago
Mortgage rates and the
average interest rates for
long-term mortgages
rose slightly in the week
ending Nov. 24, the U.S.
Federal Home Loan
Mortgage Corp. said
Wednesday. Although
increases were slight,
rates rose for the second
consecutive week for
both 15-year and 30-
year mortgage contracts
after two months
without an increase. The
average interest rate for
30-year f
Mortgage rates leap to
3-month peak
Bankrate.com
5 days ago
Mortgage brokers had
bad news this week for
loan shoppers who
hadn't locked in their
interest rates. The
benchmark 30-year
fixed-rate mortgage rose
16 basis points this week,
to 4.62 percent,
according to the
Bankrate.com national
survey of large lenders.
Mortgage rates not
'seriously high': RBA
Business Day
9 hours ago
Borrowers are not
paying ‘‘seriously higher
interest rates’’ than they
should be in the current
economic environment,
the Reserve Bank chief
says.
VOTE UP
VOTE DOWN
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Vacations: Planning A
Trip To Southern
California
Vacations: Planning A
Family Vacation
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