"If you have enough capital on hand to start looking at a second home, you'll need to decide whether you intend to use it as a holiday home or an investment property. While it's possible to use a property as both, finding one that suits both your holiday lifestyle needs and has the potential to generate maximum returns can be challenging," says Gerhard Kotzé, CEO of the RealNet property group.
"There are several factors to consider when making your decision, including:
Location
If you're looking for an investment property, you'll likely want to choose an area with high rental demand, strong appreciation potential, and reliable service delivery, as this will maximize your chances of securing tenants.
However, if you're after a holiday home, you'll want an area that you and your family will enjoy visiting regularly, prioritizing proximity to amenities and activities you all enjoy.
Appeal vs. Personal Connection
For an investment property, it's wise to select a home with broad appeal. Consider factors like size, popular amenities, and the number of bedrooms when making your choice.
On the other hand, if you're searching for a holiday home, focus on finding a property that matches your family's tastes, as you'll likely spend a significant amount of time there.
Self-Managing vs. Outsourced Property Management
When considering a holiday home, keep in mind who will look after it during periods when it's unoccupied. Ideally, you'd live close enough to visit regularly for maintenance. While hiring cleaning and gardening services is an option, being within driving distance allows you to check on the property as needed.
With an investment property, however, you can outsource the management of rentals to a Property Practitioner, eliminating the need to live nearby. A Property Practitioner can screen tenants, collect rent, and conduct property inspections on your behalf.
Sometimes, you may be fortunate enough to find a property that serves well as both a holiday home and an investment property. However, as with any property purchase, it's essential to make a decision underpinned by thorough and careful research.
Author: RealNet
