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5 Tips to Make Sure Your Vacation Property is a Good Investment

Have you always dreamed of owning a cottage or waterfront property? Spending happy summers with your family making incredible memories? It is a great dream to have and may be closer than you think. [link to common cottage myths article].

We’ve rounded up our top 5 tips for making sure your vacation property is a good investment for both your family and your finances

1. Use a Local Realtor

In Southern Georgian Bay and Simcoe County, we often encounter people using an out of town Agent while looking for cottage and vacation properties. While you always want to be comfortable with and trust your Realtor, it is crucial to work with an Agent who knows the area where you are buying. They’ll have much better insight into the local market, an extensive network and contacts to draw on and be able to share what living in the community is actually like. All of these factors ensure that you’ll find exactly what you’re looking for in a community you’ll love.

Drone image of Pointe au Baril Georgian Bay Waterfront2. Focus on Location First

Consider where your home-base is and how long of a drive you’re willing to make to reach your property. Will you use a cottage every weekend if it takes 5 or 6 hours, without traffic, to get there? It is true that the farther North you go in Ontario, the more affordable real estate can be, but the typical family wants to be able to reach the cottage in under 2 hours. What makes the most sense for your situation?

Southern Georgian Bay is the perfect location for a vacation property as it is a 90 minute drive away from the GTA and has a wide range of vacation properties and 3 to 4-season cottages at every price point.

3. To Rent or Not to Rent

One of the best ways to off-set the cost of a recreational property is to rent it out when it would otherwise be empty. The income generated goes directly towards off-setting the mortgage and upkeep costs on the property.

Renting comes with a set of unique challenges, and before setting the budget for a vacation home, you’ll need to consider whether you are going to leverage this option. If you will be renting, think through what makes a property desirable to renters and how often you’ll be willing to have renters using the home. In Simcoe County, we have an almost ideal situation for renting out your vacation home as the area is active year-round and can appeal to both sun-lovers and snow seekers.

Sandy beach view of Georgian Bay4. Investigate Additional and Upkeep Costs

Before making any real estate investment, it is important to think through all of the associated costs that come along with owning the property. This is even more true for a cottage or vacation home. Not only will you need to plan for property taxes, utilities and insurance, but additional budget may be required for maintenance and upkeep, boat or dock storage and well or septic systems. Each recreational property is unique and comes along with its own specific requirements. Take the time to consider and learn about any potential costs before purchasing. What looks like a good deal from the purchase price may end up with a far greater price tag in the long term.

5. Trust Your Heart

While we’ve outlined how to make sure you’re making a realistic decision when purchasing a cottage, this type of property is not a purchase that should be motivated only for financial reasons. While Ontario cottages tend to retain their value over time, they can take longer to sell (should you ever want to do so) and mortgage and insurance rates can be higher. You should have a strong emotional investment in the property and a commitment to the memories and traditions you will gain from this special place in the years to come.