| For those who don't plan to retire for decades, | | | | early allows them to enjoy the asset prior to |
| purchasing a retirement home has many benefits. For | | | | retirement. Second homes are a great way to spend |
| one thing, a retirement home can be used as a | | | | quality time with family and friends. In addition, the |
| vacation and weekend home. And, as the kids get | | | | location of the second home may not be as |
| older, it's a great way to entice them to visit. | | | | affordable in the future. |
| Retirement Home Sales | | | | The Cost |
| Baby boomers, still 20 or so years from retirement, | | | | Second home buyers are not people tapping into |
| have fueled a boost in vacation home and retirement | | | | their tax-deferred IRAs or 410(k) plans, they are |
| home sales. According to the National Association of | | | | using funds they would have put into investments |
| Realtors, reports for 2006 recorded 1.07 million | | | | with no special tax benefits. |
| vacation homes sold. Vacation and retirement home | | | | They key question is whether you can afford to pay |
| sales were up 5 percent from the previous year. | | | | for your future homeownership needs today. When |
| Following are some interesting statistics on second | | | | researching the cost, factor in maintenance, insurance |
| homes: | | | | and taxes, along with the price of the retirement |
| - 80 percent of these buyers will use the home for | | | | home. If you can't afford to live in two homes, |
| vacation. | | | | consider investing in a retirement home and renting it |
| - 35 percent said they were more interested in | | | | out. The rental income may even provide you with |
| diversifying investments. | | | | extra income in addition to covering the cost of the |
| - 25 percent said they invested for tax benefits. | | | | home. Although this scenario does not provide much |
| - 30 percent of buyers see these homes as their | | | | opportunity for you to use the house before |
| primary retirement residence in the future. | | | | retirement, it allows you to buy in a community that |
| - 20 percent plan to rent their vacation or retirement | | | | may be less affordable as you near retirement. Keep |
| homes. | | | | in mind that unique properties, such as those located |
| The Investment Decision | | | | on lakes, golf courses, or in recreational settings, tend |
| Many young home buyers view this as making a | | | | to appreciate more than those located in subdivisions. |
| good decision with their personal finances. Instead of | | | | A home is an asset as well as a source of |
| investing in the market, they are choosing to invest | | | | enjoyment and satisfaction. If your finances permit, |
| in their future real estate needs. | | | | investing in a retirement home now could result in a |
| Home buyers also look at these purchases as an | | | | great investment for your family in the future. |
| investment in family. Investing in a retirement home | | | | |