Second Homes: What You Need to Know
This is a transcript of a podcast posted January 31, 2007.
 This is our second interview with Craig Venezia, a nationally recognized mortgage expert and the author of Buying a Second Home: Income, Getaway Retirement, from Nolo. In our previous interview we discussed issues that arose when co-buying a second home. In this interview we’ll focus on several issues involving the financing and the location of a second home.
Nolo: Craig, let's start with the location. When making a decision about buying a second home, some people buy locally and some people buy in a vacation area, while others buy in a location where the house prices may be lower than where they are currently living. Can you give us any suggestions for where to look for a second home?
Craig Venezia: A general rule of thumb for where to buy your second home is to keep it within a two-hour's drive away. The benefit of this is that it doesn't take you all weekend to get to your weekend getaway. And you also have to think about not just enjoying your home but also property management and upkeep issues. That's true for investors who are renting out their place full-time, people who are buying a weekend getaway, or the person that's going to be using it as a retirement.
One interesting trend that we've been seeing is that a lot of people are actually buying second homes locally, either in the same town or a neighboring town. And what’s interesting about this is a lot of people who are buying for future investment are doing that because they like the town where they live, they know the area, they’ve established family and friend connections. They don’t want to leave the area but they also know that when they retire they don't need this big home, so what they're doing is buying in the general area, renting out their new places, and then, when they retire, five, ten, fifteen years down the road, they will move into their current second home and make it their primary residence.
Nolo: Let's say that you're considering buying a second home in an area that you are not really familiar with. What's the best way to start that process?
Craig Venezia: First and foremost, I always say pick up the Yellow Pages or go online, find a local real estate agent. They are the ones that know the towns where you'll be looking. This is particularly true if you're coming to an area where you have less familiarity, and that is true too if you've been to the area but you just vacationed for a week or two and then left. You want to know the ins and outs of an area. Your best resource is to go to a real estate agent and work with them and learn as much as you can about the area.
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