Get Away From the Tourist Horde and Still Earn on Your Second Home
By Margaret Summerfield
By Margaret Summerfield
If
you're thinking of buying a second home that you want to use yourself
and also rent out to generate some income, you may have felt conflicted
about where to buy.
Common
sense tells you to buy in a place that's a tourist hotspot. That way,
you've got a big pool of potential renters. But suppose you're not a
party animal. You don't like crowds or noise or hustle and bustle. You
want a second home in a tranquil spot where you can escape and unwind.
The tricky question is, in a place like this, can you still make good
rental income?
The
short answer is yes. In some secluded hideaways, your second home can
do more than cover its costs. It can earn a handsome income. Here are my
top three picks where you can do that:
Location #1
As
this country emerges from the shadow of its better-known neighbor to
the south, it's beginning to gain a reputation as the hottest tourist
destination in the region. It's got a lot to offer: steamy volcanoes,
island-sprinkled lakes, wildlife-packed rainforest, and charming
colonial towns.
But my focus is on the country's southern Pacific coast, where jagged cliffs plunge down to pristine beaches.
On
this section of coast, pounding surf crashes up on rocky crags...and
unspoiled beaches meander for miles. The beaches are free from crowds
and from development. It's quickly gaining ground as a getaway
destination for the jet set. A new resort here charges guests upwards of
$500 a night. Their residential villas, at $750,000 a pop, are sold
out.
But
just 10 minutes from the resort, you can live in luxury without
breaking the bank. Set in 2,700 acres of rolling hills and forest, this
community boasts five beaches, one with pink sand. It's got an
equestrian center, tennis court, restaurant, clubhouses, and a newly
opened boutique inn. It's an established community with a slew of
amenities—yet you can buy an ocean-view lot here for as low as $86,000.
The icing on the cake? Homeowners report strong rental income of up to
$350 a night.
Location #2
This
Caribbean island is a magnet for tourists. More than 5 million came for
some fun in the sun in 2014. But it's easy to escape the crowds. That's
because most visitors stay in one of the all-inclusive hotels on the
country's eastern seashore. They rarely venture outside their resort.
They don't know what they're missing.
What they're missing is this
quiet peninsula where palm-covered hills tumble down to the ocean.
There's mile after mile of soft-sand beaches. One small town in
particular grabbed my attention.
There's nothing
cookie-cutter about this beach town. It's an appealing mix of friendly
locals, good food and a slow and sleepy pace of life. Everything is on a
small scale in this beach town. You can walk to stores, walk to
eateries, walk to the beach...stopping to chat with friends and
neighbors on the way.
This beach town feels
upscale. But it's much more affordable than other island getaways. You
can buy a condo in town for as little as $72,000. With the lack of
competition from big hotels, you can generate strong rental income, too,
of up to 10% a year.
Location #3
The
last three times I visited this destination, I hit a glitch. I couldn't
find a decent hotel room. That's not surprising. The biggest hotel in
this area only has 30 rooms.
On
my last trip, I ended up staying at a hotel that was, quite frankly,
tired and shabby. But it was the only hotel I could find with
availability. This throws up an opportunity for folks that own a home in
the area. Thing is, most want to keep their homes to themselves—a
secret bolt-hole where they can get away from it all.
This
is the perfect place to do that. It's like living on the doorstep of a
national park. The landscape is amazing. Just five miles from the
unspoiled beaches, there's a 6,000-foot-high mountain. The forests are
rich with wildlife. Sip coffee on your terrace in the morning and you'll
likely see monkeys, coatis, toucans, hummingbirds, and bright-colored
tropical frogs.
It's
not a mainstream tourist destination. For years, poor access kept
tourists away. A new road has started to open this region up. But it's
still a hidden gem. And, thanks to growing demand and a shortage of
accommodation, your home can do more than earn its keep. It can also
earn you a profit. You can charge up to $2,000 a week in rent on a
three-bedroom house in this location.
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