Winnipesaukee Forum - View Single Post - Does buying a small piece of lakefront property & renting it out make sense?

Descant · 04-22-2014, 10:32 AM

We bought a condo many years ago when motel conversions were strong. Rent in the summer and use it for skiing ourselves in the winter. The first summer weekly rentals went pretty well. Our first winter rental cancelled-not good skiing, so we didn't want to use it either. The next winter we rented Labor Day to Memorial day at very reduced rates to a single tenant. This worked well, but showing and renting in the winter at long distance was not good and we didn't have enough margin to pay a manager or Realtor.
Moving weekly summer rentals in and out on Saturdays started to consume our weekends. People called Friday night to say they would arrive late or on a different day and we had to cancel plans to work a new schedule.

Finally, we decided our weekends were more important than the condo and we sold it. Nice profit. Two years later, the condo market collapsed and nobody wanted a Lakes Region condo at any price, and financing was difficult for most. Many foreclosures ruined the market.

Vacation properties can be a very volatile market. If you can afford the place without rental income, and you decide to rent, that's OK. If you're relying on rents to pay the bills and you want a mortgage, a lot of lenders won't talk to you. If you buy other rental properties and plan to sell later to buy a retirement home, you may have to pay back the depreciation. Better to get the mortgage paid off and use the income stream to pay for your retirement property.

04-22-2014, 10:32 AM	#10
Descant Senior Member Join Date: Mar 2006 Location: Merrimack and Welch Island Posts: 4,479 Thanks: 1,390 Thanked 1,667 Times in 1,086 Posts	Condo option We bought a condo many years ago when motel conversions were strong. Rent in the summer and use it for skiing ourselves in the winter. The first summer weekly rentals went pretty well. Our first winter rental cancelled-not good skiing, so we didn't want to use it either. The next winter we rented Labor Day to Memorial day at very reduced rates to a single tenant. This worked well, but showing and renting in the winter at long distance was not good and we didn't have enough margin to pay a manager or Realtor. Moving weekly summer rentals in and out on Saturdays started to consume our weekends. People called Friday night to say they would arrive late or on a different day and we had to cancel plans to work a new schedule. Finally, we decided our weekends were more important than the condo and we sold it. Nice profit. Two years later, the condo market collapsed and nobody wanted a Lakes Region condo at any price, and financing was difficult for most. Many foreclosures ruined the market. Vacation properties can be a very volatile market. If you can afford the place without rental income, and you decide to rent, that's OK. If you're relying on rents to pay the bills and you want a mortgage, a lot of lenders won't talk to you. If you buy other rental properties and plan to sell later to buy a retirement home, you may have to pay back the depreciation. Better to get the mortgage paid off and use the income stream to pay for your retirement property.