There’s nothing quite like packing your bags and heading to Florida for the winter to escape the cold weather much of the rest of the United States faces, but it’s also a relief to head back before suffering through the hot and humid summers of the Sunshine State. This is why it comes as no surprise that out of the top 25 most popular cities for vacation homes in the United States, 13 are located in Florida!
Buying a vacation home and becoming a part-time Florida resident may be the perfect answer to cure the winter blues, but it’s important to consider several things before your purchase. This guide from Florida real estate attorney Gary I. Handin, P.A. will help you understand what being a “snowbird” entails and it will help you understand how involving a real estate lawyer can make you a more informed vacation home buyer.
CostThe dream of owning a vacation home is a great dream to have, but making sure you have the funds to buy it is a different story. Cost doesn’t just include the base price of buying the home, you must also factor in the price of a second mortgage, travel costs going to and from your vacation home, monthly operational costs such as electricity and water, possible repair costs, homeowner’s association fees, property tax, and insurances–to name just a few of the basics. Due to the location, other amenities such as yard maintenance and cleaning services often come at a higher price compared to other areas of the United States.
TaxesFlorida is very unique when it comes to taxes due to the fact that they are one of only seven states in the United States that do not have a state income tax. While this may be beneficial for full-time residents, it can also result in having to pay higher property tax for non-residents who purchase vacation homes. Depending on the location of your second home, your property tax may be higher or lower. Residents of Florida are eligible for lowered property taxes through programs such as homestead exemptions, Save Our Homes assessment limitations, and needs or service-based programs. However, non-resident vacation homes are not eligible for these exemptions.
InsuranceJust like your primary home, your vacation home also needs homeowner’s insurance to protect it from damages such as theft, fire, hurricanes, flooding, and many other occurrences. Unlike your primary home, Florida often has extreme hurricane seasons that can cause massive amounts of flooding and wind damage. Most insurance policies will not cover damage caused by hurricanes which makes it necessary to also purchase both flood and windstorm insurance to protect your home. One trick to lower the price of your insurance is to make sure your home complies with the newest regulations and to check for things such as damaged roofs, old plumbing, and faulty electrical work.
LendersAs you will more than likely be applying for a loan to purchase your vacation home in Florida, it is important to understand that different lending institutions have different criteria for deciding what qualifies as a vacation home. The strongest determining factor for vacation home status is how much time you and your spouse (not guests) spend at the home every year. More than likely, you will also face higher loan interest rates for your vacation home than you would for your primary home. One tip is to not go with the first lender you come across. Shop around to find the lending institution with the best rates.
Market ConditionsFlorida has an incredibly fluid housing market no matter the year. For example, after a huge tropical storm or hurricane, many people try to sell their homes, making it less expensive to buy a vacation home. However, with more homes being purchased, it is likely that lending institutions will begin to raise their interest rates. On the opposite end, if the housing situation finds itself in a seller’s market, it will usually result in lower interest rates. Though market conditions tend to fluctuate nationally, expect a little more variation in Florida due to the weather and locations. Finding a local real estate attorney will help you better understand these conditions.
Owning a vacation home in Florida can be a dream come true because of our fantastic weather, gorgeous beaches, and bustling activities – it’s the perfect escape from the cold winter temperatures much of the rest of the nation faces. However, finding and purchasing your second home requires a lot of thought and planning. Enlisting the help of a real estate attorney such as Gary I. Handin, P.A. will help provide you with a guide to navigate the often-confusing factors such as cost, taxes, insurance, lenders, and market conditions. Call us toll-free today at 1-877-815-4560 to help you find your dream vacation home in the Sunshine State!