I'm considering purchasing land and building a vacation home. I would like to find out how much this will cost, and what the financing options are. I'm guessing I should find a real estate agent that specializes in vacation properties.

I'm considering purchasing land and building a vacation home. I would like to find out how much this will cost, and what the financing options are. I'm guessing I should find a real estate agent that specializes in vacation properties.
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#1

Is that the best place to start? How can I get a ballpark cost estimate?

I’m interested in building a vacation home, instead of buying a pre-existing home, because I want the home to cater toward my specific needs – mostly entertaining large and small gatherings, and I have a particular style that I like.


#2

If the home is in a vacation area, you should be able to talk to a couple of agents in the vicinity and ask for references to contractors that you can interview. Look at homes they have built and ask for referrals to owners who have worked with them. If I knew more about what and where you were considering, I could be more helpful. Real estate is so big on the internet that you should be able to do a lot of comparison shopping from your own desk and read reviews/get into conversations with others who have done what you're wanting to do. You should even be able to get a fairly good range of cost per square foot for your vaca home, but, of course, the personal touches to make it fit your "style" will add to the cost.

Good luck and I hope this helps!


#3

You probably are not going to like my answer, but having been down this road personally, I would like to share a couple of thoughts. First- unless you are plan to use this place a lot, I would consider finding something suitable you can rent. Then you don't have the maintenance, the costs when you are not using it and it gives you flexibility to go other places. We bought a place in the local mountains. It was a disaster financially - fortunately, it appreciated so I broke even.

The other issue is retirement. Many people have never done the math. So they don't know how much they need in capital to retire. If you have that all taken care of and you are saving enough to hit your goal - then this is a great option. But if this money is instead of saving for retirement- you might want to rethink this. If you are 40 and have the average savings for retirement - you could be well behind the eightball.

Say you earn $100,000 and your want $100,000 as your retirement income. You will need $1.5mil when you take off social security. (Assumes age 70). If you have $50,000 in your IRA or 401k. that could be worth at 7% - $400,000. But you are still shy by $1.1mil. You would need to save nearly $1000 a month to get to this target. If you are doing this - the go for the vacation home. But if you have a choice of renting and saving for retirement - I bet you know my answer.

Hope this helps.

As to your question - find a realtor in the area where you want to buy. Shop around and see who has the most listings. They are usually the ones with the best contacts. Ask them to introduce you to a good builder. The rest is easy. Plan on $250 a square foot plus the land.


#4

Thank you for your question.
Before buying any second home or rental property - I always advise people to get an insurance quote for the property first.
Second Homes are generally much more expensive to insure than the primary.


#5

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