Buying a beach house is less expensive when you purchase it outright. Doing it through financing can increase the amount you pay due to mortgage interest. But that is only the apparent expense when buying a beach house. The hidden costs of owning such property include repairs, maintenance, utilities, homeowner’s association, property insurance, and so much more.
There are two components of property insurance. The first one is the homeowner’s insurance that costs $4 every $1000 of the property’s value. For instance, the value of the home is $500,000. The cost of insurance will reach $2,000 yearly. The second component of property insurance includes whether or not the beach house you bought will be rented.
For those who are planning to have their beach house rented, the maximum cost they will pay can reach up to $200 or more every month. If we calculate it annually, it would cost $2,400.
Repairs and maintenance
While repairs and maintenance are seen as a financial burden by most homeowners, these helped me sell my house fast West Palm Beach. According to research, maintenance and repairs can cost about one percent of the property’s value annually. It means that a $500,000 beach house will cost $5,000 yearly for such expenses.
Landscaping is included in the maintenance cost you have to pay to keep a vacation house neat and appealing. And it is known that maintaining a backyard can be very expensive. Good thing that beach houses don’t always need such a service. If you are planning to buy a beach house, consider buying one that doesn’t require so much maintenance.
Homeowner’s association dues
Another hidden cost of owning a beach house is the homeowner’s association dues. These can range from $150 every quarter up to $2,500. In return for paying this fee, you may get some services such as lawn maintenance and landscaping, among others. But if you are not planning to live in your beach house all the time, homeowner’s association dues can be a burden to you.
Income tax considerations
This expense is also among the hidden costs of owning a beach house. Most states abide by the 183-day rule that mandates those who are living in a state for at least 183 days yearly to pay income taxes to that state. Meaning, property taxes, mortgage interest, as well as other issues, are also required to be reconciled in the state where the beach house is located.
Those who are still planning to buy a beach house should consider these hidden costs of owning a beach house. It is so they can prepare their finances the moment they finally decide to own such property. While there are a lot of expenses to settle when owning a beachfront home, the benefits it comes with are worthwhile. I have listed these hidden costs to open the eyes of potential home buyers and help them make the right decision.
I hope you find the right beach house that suits your budget and needs!