any thoughts?

[beachkids]

I have been a reader-lurker for a long time and enjoy the info and conversation- especially after storms.

We have been long-time sowal vacationers (20+yrs) and were fortunate to buy property years ago. There is no place like it! We have put-off building but are considering doing so before our kids move on. We would likely rent the property but wonder if the rental income would allow us to afford it with construction costs and taxes? We thought it would be affordable with the prices we paid for the lots but as the story goes for rentals in high-appreciating areas.....

I think we will be ok.

Any other thoughts or ideas?

 

[Beach Runner]

I have been a reader-lurker for a long time and enjoy the info and conversation- especially after storms.

We have been long-time sowal vacationers (20+yrs) and were fortunate to buy property years ago. There is no place like it! We have put-off building but are considering doing so before our kids move on. We would likely rent the property but wonder if the rental income would allow us to afford it with construction costs and taxes? We thought it would be affordable with the prices we paid for the lots but as the story goes for rentals in high-appreciating areas.....

I think we will be ok.

Any other thoughts or ideas?

From our experience you'll only get rentals from Memorial Day to mid-August, a few during the spring, maybe a random one, and that's it. Our home even has a private heated pool and hot tub, but that doesn't seem to attract anyone in the off-season. So the rentals don't cover mortgage, taxes, and insurance (especially now that the cost of insurance - if you can get it - has skyrocketed). However, the increase in value of the property has more than covered the mortgage, etc., so that's how we justify it. We have enjoyed our beach home so much that we are willing to cut back in other areas to afford it.

 

[Mermaid]

My opinion pretty well follows Beach Runner's. I don't think the income ever exceeds the outcome (is that the word?). You'll always have more expenses than what you can bring in to cover it! However, the appreciation if and when you sell is where the profit's found.

Trouble is, SoWal is so wonderful--at least for us--that the selling part is not an option. This beach pays for itself in so many ways other than the $$ that we live with the expense and consider it justified.

Oh! and to you! Post often.

 

[skippertoo]

 

[Paula]

I agree that if you don't have a lot of money to spare and have to depend on rentals, you want to buy a place that you can afford without rental income if necessary. The rentals are fantastic cushions and it's likely (though not guaranteed) you'll be able to get them spring vacation and summer. But, at today's home/condo prices, you may not be able to charge enough to get your money back. Also, keep in mind that if there's a hurricane or other reason, you may go without a season's rentals or more if it's a major hurricane that damages beach access (you'd probably have to offer steep discounts) or your home (no rentals). So, you'll want to be able to afford the mortgage, taxes (which went up for us this year), and utilities (which went up for us this year). And you have to pay those whether or not you have renters.

That said, I'm SOOOOOOOOOOOOOOOO glad we bought in SoWal. I'm also glad that we didn't overextend ourselves and bought within our means. And we've certainly made some lifestyle trade-offs (no new kitchen or other extra upgrades in our regular home, no country club that some of our friends belong to but heck we have plenty of stuff to do in our town, no new cars but I could care less about cars, etc.) to be able to afford the places in SoWal. No regrets. The sunsets, the beach, the nice people, the food, the complete relaxation with family and friends has made us very happy. I'd be less happy if I felt I had to depend on rentals to afford the place.

 

[Mermaid]

Paula, that's a very good way to put it--rental income is a "fantastic cushion." It's definitely not the whole seat.

 

[Paula]

Mermaid: And you're a new owner so eventually you'll get return renters because your place is so nice and I'm sure you take good care of guests. Return renters will be important because as the community gets built up, vacationers will have more options.

 

[Miss Kitty]

beachkids. This has really been a good day for coming out!!! Our rental income does not cover our expenses. But it sure makes it easier...Mr. Kitty and I do a little dance everytime we get a check!

 

[Mermaid]

Mermaid: And you're a new owner so eventually you'll get return renters because your place is so nice and I'm sure you take good care of guests. Return renters will be important because as the community gets built up, vacationers will have more options.

Paula, I appreciate your kind words about our place and your vote of confidence. Every day I check the e=mail hoping for a reservation request!

 

[beachkids]

Thanks for all the great comments. Nice to hear from everyone. I thought it may be a break-even proposition but considering how long we have been renting and spending ourselves, I guess it is probably time to build. We can afford a slow year now and then. When you consider a vacation house that is worth nearly twice what your other home is worth- it pays to do some research.

When we purchased the lots, we figured it was a good value but never imagined the appreciation of the past five years.

I think we will get the plans together and get some estimates. Thanks again.