Do Vacation Homes Make a Good Investment Option?

Bangalore: Does vacation homes make a good return on investment? Although, owning a vacation home sounds attractive and tempting, yet you need to decide whether investing in such a property will be a good investment option or will it just to boost lifestyle. Before investing in a vacation home, you need to answer certain question like the home you are investing in is for accommodation purpose or for rental purpose? Below is the list of things you need to look at before buying a vacation home in popular tourist spots, reports Amit Shanbaug of ET Bureau.

Earning return on investment:

Earning return on investment from a vacation home depends mainly on the purpose of buying. One of the best options to earn returns is by renting it out, since vacation house is not where you going to live all through the year. However, the rental income from vacation homes is not steady compared to regular properties because such homes only get rental during peak tourist season which lasts only from 12 to 15 weeks in a year. So, if you are planning to invest only to make rental income, then you need to think carefully or else it may land you up in situation where you have to struggle to search tenants during the non-tourist situation. Moreover, if the rental earning from tourist season is doing good then you need to evaluate it properly, whether the cost generating from tourist season is enough to cover the cost for the entire year or not.