Vacation property, how to do it right?

[LineSkiCat14]

A few relatives own some cabins on a very popular lake by me. Usually, these things are ungodly expensive. Way out of my means (not trying to make this a paddock flex post).

However, a cabin went up for sale, pretty much on the same piece of land my family owns some cabins. 50ft to the lake, 3br/2.5b, lake rights, and possibly even a boat slip. There's only one house that's kind of in front of it, otherwise, great views of the lake. The house is on the market for less than half of what it should be. However, the foundation is bad and needs to be redone. What's worse, the bottom 6-12 inches of the house began to rot. All of that, will need to be addressed and redone at some point.

However, the property alone (with no house) is worth the price. Ideally, we'd rent the cabin out for most of the summer and try and rent it out for the winter as well.

To me, this is almost a can't miss opportunity, even if we had to do the worst, and level the house to put a modular in on a slab.

How bad are foundation repairs? Worth the trouble? Anyone have vacation rental property? How do you manage it? Is it worth it? And am I crazy to want to buy this before I buy my first actual house? I really think it's a great opportunity.

 

[BankerCat12]

Do you have a primary residence?

 

[LineSkiCat14]

I currently split an apartment with my buddy. I know it sounds stupid to NOT get a house first.. But honestly, I pay $450 and save a pretty substantial amount. I honestly think grabbing this lake house/property is a better choice, financially, than buying a house. The value of this lake continues to go up and up. I'm up there 3-4 times a summer as is and would love to be up there more.

Further, the house is winterized and is within an hour from 3-4 really good ski mountains.

It's also not out of the ordinary (and happened a few houses down), for some big shot millionaire to come in and offer a huge paycheck to bulldoze the house to build his giant mansion. It's *that* type of lake and summer destination.

 

[Ron Mehico]

Life is short man, just go for it. If you live with a buddy in an apartment then you are young enough to not have it effect you that badly in the long run even if it doesn't work out like expected. You sound so excited about it that you would always think about it and regret it if you didn't go for it.

 

[80 Proof]

Is the foundation a slab, crawlspace, or basement?

I'm guessing crawl based on what you've said, which means you could jack it up pretty easily and just shim it level on top of a repaired foundation. That usually isn't a long term fix (you'll get 10-20 years out of it) but that sounds like what you should do if you have the opportunity to sell it later or rebuild yourself when you have more capital.

Is the frame rotting, or just the exterior and sheathing?

 

[bluelifer]

If the house is really priced at half of what it should be, it won't stay on the market long. The structural issues will scare away a few potential buyers, but someone that knows what they're doing will snatch it up and make some money off of it.

Find someone who knows what they're looking at to check it out for you. Pay someone if you have to. I'm not talking about a home inspection, but someone who remodels homes that can give you a good idea of what you'd be getting into and how much it could potentially cost.

Dirt is rarely a bad investment.

 

[mashburned]

Yes. F the foundation/repairs and buy a boat.

 

[UKserialkiller]

A few relatives own some cabins on a very popular lake by me. Usually, these things are ungodly expensive. Way out of my means (not trying to make this a paddock flex post).

However, a cabin went up for sale, pretty much on the same piece of land my family owns some cabins. 50ft to the lake, 3br/2.5b, lake rights, and possibly even a boat slip. There's only one house that's kind of in front of it, otherwise, great views of the lake. The house is on the market for less than half of what it should be. However, the foundation is bad and needs to be redone. What's worse, the bottom 6-12 inches of the house began to rot. All of that, will need to be addressed and redone at some point.

However, the property alone (with no house) is worth the price. Ideally, we'd rent the cabin out for most of the summer and try and rent it out for the winter as well.

To me, this is almost a can't miss opportunity, even if we had to do the worst, and level the house to put a modular in on a slab.

How bad are foundation repairs? Worth the trouble? Anyone have vacation rental property? How do you manage it? Is it worth it? And am I crazy to want to buy this before I buy my first actual house? I really think it's a great opportunity.

Buy a condo down here in Orlando where I live. About 1000 sq 1/1 garage upstairs down stairs. hoa fee of $255 a month going for $100K.

2.5-4 miles from Disney. Rent is going for about $1100 a month for a 1/1. Or can use as BBnAir Next year if they are in the same price when I pick up more money I'm buying another.

 

[LineSkiCat14]

Some good stuff! Glad most see it the same way. I was looking at the numbers, the property, and just the growth of the lake. Makes total sense.

The other cabin owners (not my family) have been scaring people away from buying it. Probably because they want to tear it down or buy it themselves. One guy tried to say the foundation work was going to be $250,000. Clearly trying to scare people away.

 

[LineSkiCat14]

Is the foundation a slab, crawlspace, or basement?

I'm guessing crawl based on what you've said, which means you could jack it up pretty easily and just shim it level on top of a repaired foundation. That usually isn't a long term fix (you'll get 10-20 years out of it) but that sounds like what you should do if you have the opportunity to sell it later or rebuild yourself when you have more capital.

Is the frame rotting, or just the exterior and sheathing?

This is really the only part I have to vet. Isn't even mentioned on the listing, but even my aunt said the house has the problems mentioned and I trust her. I know it's NOT a slab. I think a full basement. Looking around the side of the house you can see the foundation going down pretty far.

Yes. F the foundation/repairs and buy a boat.

Boats are a really bad investment. But it is on the list if I grab this house. But you should really have a place for the boat. Trucking it around is a pain although I guess you save on the marina fees.

The place is still 100% livable. So maybe hold off on the restoration/demolishing and use that money to buy a boat the first year haha. I'll just have to hope it doesn't crash in on me. If it's uneven, peeing may be tough at night.

 

[BankerCat12]

How much do you have in liquid assets and what do you have saved in investments or retirement accounts?

Just my two cents...if it was a cant miss opportunity, the property would already be pending sale and/or closed with a cash deal. I think you would be better off buying a duplex and living in one unit and renting the crap out of the other one and hopefully your tenant covers most of the payment. You will also be hard pressed to find a lender that would lend to you on a lake house rental when you have never owned a property before (assuming you have not.)

Would you be managing this rental and how far is it from your apartment?

 

[LineSkiCat14]

I have well higher than the average 29-year old has for a 401k. Opening a Roth IRA this week. No student loans, about 2 years on a car loan where the car is about +$3,000. 825 credit score

Nothing great. My income is probably considered standard, but have been very smart with personal finance. Still, it may not be enough.

I live about 60 miles from the Lake.

One idea, because my father was the one who spoke to me about the property, is that we would both go in on it. He could put the DP on it and I would pay a monthly agreed upon sum. The house would be half mine, and when he passes, his half would be split between my two younger brothers. I know this can get messy, but it might be the easiest way to get the house.

 

[LineSkiCat14]

That's a good point: If it's such a can't miss property, why is it still on the market?

I think it's a new listing and the work the house needs might be scaring people away? I know that the neighbors have been scaring people away recently. Claiming the repairs are a quarter million. Property up there doesn't sit for long. I have to imagine someone is going to buy before next season.

 

[krazykats]

Dude go all in. Worst case scenario you pay what it cost to fix the foundation and move forward.

Or possibly better, but I'm not sure you actually can get it past inspection of not, since it's a basement fill the hole with dirt and rebuild it.

No matter what I'd buy the property and go from there.

 

[Get Buckets]

Dude go all in. Worst case scenario you pay what it cost to fix the foundation and move forward.

Or possibly better, but I'm not sure you actually can get it past inspection of not, since it's a basement fill the hole with dirt and rebuild it.

No matter what I'd buy the property and go from there.

 

[LineSkiCat14]

That's what I want to do.. just buy it and go from there. But Banker makes a good point. I might not have enough backing me to get a loan, especially one for Vacation Property.

The inspection is another thing. I was told I may not be able to get a loan if the bank sees that the foundation needs to be redone. However, the banks inspectors might not even see that the foundation is bad. Any of that sound right?

 

[Bill Cosby]

Why not just tell the bankers it's your primary residence? You're definitely going to need to tell that to the insurance company to get better rates. Slip the inspector a $20 to overlook any foundation issues and you're good to go.

 

[LineSkiCat14]

I'm all for lying. I don't see how they'd know if I live there or not. But I have no idea how to ensure that I DON'T get caught. Honestly, I could be spending half the year up there as is. Between skiing and summer lake life.. I wouldn't be mad if I had to spend 20-30 weeks up there. WOrk commute would suck, but that's it.

 

[UKserialkiller]

I'm all for lying.

Me too. Best of luck, Lineski.

 

[krazykats]

That's what I want to do.. just buy it and go from there. But Banker makes a good point. I might not have enough backing me to get a loan, especially one for Vacation Property.

The inspection is another thing. I was told I may not be able to get a loan if the bank sees that the foundation needs to be redone. However, the banks inspectors might not even see that the foundation is bad. Any of that sound right?

Where is it? If it's Nolin the inspector is going to be a bank rep not a private inspector.

Anywhere else I don't know.

Can you go in and see the damage, or what is thought to be damaged before buying.

 

[krazykats]

No offense to you, but how did you help the OP?

Filling in the damn hole with dirt is a very easy fix and probably the cheapest too.

 

[Get Buckets]

No offense to you, but how did you help the OP?

By not offering ishy financial advice I have no business giving.

 

[_died]

I recommend you do all the repairs yourself.

 

[krazykats]

By not offering ishy financial advice I have no business giving.

The guy came to a message board. My "buy it and go from there" was sarcasm.

My apologies to you sir since sarcasm isn't something you are used to here.

 

[Get Buckets]

The guy came to a message board. My "buy it and go from there" was sarcasm.

My apologies to you sir since sarcasm isn't something you are used to here.

Given you were asking legitimately about investing in Bitcoin on here recently, yeah that comment didn't register on the sarcasm meter.

 

[krazykats]

Oh I see your aware your too stupid to give advice, but make fun of those that ask for advice on what they don't know and offer ideas as to what might work.

Note to self a question on anything means you know nothing.

 

[UKserialkiller]

Oh I see your aware your too stupid to give advice, but make fun of those that ask for advice on what they don't know and offer ideas as to what might work.

Note to self a question on anything means you know nothing.

hahaha, all over a "" emoticon.

Krazy, you never disappoint man. I appreciate you guy.

 

[UK_ Alum_02]

Further, the house is winterized and is within an hour from 3-4 really good ski mountains.

Where is it? If it's Nolin the inspector is going to be a bank rep not a private inspector.

Nolin sounds right.

 

[UKserialkiller]

I'm serious about this condo place over here. Dude. I'm basically on Disney property. These places are 24/7 rented by Disney employees. This place is .25 miles from the only 6th star hotel in Orlando (Gaylord Palms).

$100K or cheaper (not getting a 1/1 under $90K). Silly to throw money in a lincoln log house. $250K? Ridiculous.

 

[UKserialkiller]

Wish I was selling cocaine again. Boy I'd buy up half of this condo place up. Goddamn

 

[Get Buckets]

Oh I see your aware your too stupid to give advice

[roll]

 

[Get Buckets]

Oh I see your aware your too stupid to give advice, but make fun of those that ask for advice on what they don't know and offer ideas as to what might work.

Note to self a question on anything means you know nothing.

Didn't make fun of anyone asking for advice, chief. I would however make fun of anyone who took your advice on, well, anything.

 

[BankerCat12]

I have well higher than the average 29-year old has for a 401k. Opening a Roth IRA this week. No student loans, about 2 years on a car loan where the car is about +$3,000. 825 credit score

Nothing great. My income is probably considered standard, but have been very smart with personal finance. Still, it may not be enough.

I live about 60 miles from the Lake.

One idea, because my father was the one who spoke to me about the property, is that we would both go in on it. He could put the DP on it and I would pay a monthly agreed upon sum. The house would be half mine, and when he passes, his half would be split between my two younger brothers. I know this can get messy, but it might be the easiest way to get the house.

If you don't have the down payment you should not be buying a primary residence, much less a lake house you live 60 miles from with foundation issues. Other than this and the fact managing from 60 miles away seems like joy, it's sounds great.

If you end up buying this, more than likely can't buy a primary residence for a couple years. Women love guys though tied down to a lake house 60 miles away. If your ideal strategy would be 20/30 weeks there, when do you plan on renting it?

Again, I would pass. Seems like a mess in all phases.

 

[krazykats]

Nolin sounds right.

Details may not be my strong suit!

 

[Ron Mehico]

If you don't have the down payment you should not be buying a primary residence, much less a lake house you live 60 miles from with foundation issues. Other than this and the fact managing from 60 miles away seems like joy, it's sounds great.

If you end up buying this, more than likely can't buy a primary residence for a couple years. Women love guys though tied down to a lake house 60 miles away. If your ideal strategy would be 20/30 weeks there, when do you plan on renting it?

Again, I would pass. Seems like a mess in all phases.

Don't be a buzzkill. Go for it Lineski!!

 

[LineSkiCat14]

If you don't have the down payment you should not be buying a primary residence, much less a lake house you live 60 miles from with foundation issues. Other than this and the fact managing from 60 miles away seems like joy, it's sounds great.

If you end up buying this, more than likely can't buy a primary residence for a couple years. Women love guys though tied down to a lake house 60 miles away. If your ideal strategy would be 20/30 weeks there, when do you plan on renting it?

Again, I would pass. Seems like a mess in all phases.

Good advice, even if it's not the answer you'd want to hear.

I have close to the DP. But with this place, there is interest by my Dad to keep it for his 3 sons. Being much much older than the other two, I would help pay for it and it would be half mine. I'd most likely pay a sum, probably around rent or a car payment, for the house.

Question, Why would I not be able to buy a primary residence after? Is that cause the potential lack of DP, or that banks wouldn't let me take another loan so soon?

The goal isn't to pick up chicks, but it's never NOT the goal either. I think your advice has been great, you know more than I do. But I can't imagine a girl in her late 20's wouldn't love a spectacular lakehouse (bigger than a cabin) with a boat.

Ideally rent it the other weeks. It's open for weeks or weekends. If I could rent it out all but 6 weeks on the year, id' be happy. But I also wouldn't mind living there either.

 

[LineSkiCat14]

The goal, up until a week ago, was to get a duplex to live in for 5-10 years and rent out the other half. I've wanted to do that for years now but House prices by me are high, and a duplex will cost about the same as this lake house.

Yes, I'd have to do some pretty substantial repairs on the lake house, maybe even bulldoze and build a modular home on a slab. But based on the property worth and vacation income > rent income, isn't that the better buy? Rent for a 2-bedroom goes for $1000/month, Lake house can be rented for $1000/week or $500/weekend (at minimum, that's also what I'm trying to figure out).

 

[PhattyJ4UK_rivals309166]

Wish I was selling cocaine again. Boy I'd buy up half of this condo place up. Goddamn

Lets go into business together....

 

[UKGrad93]

FWIW, my brother lives at a lake property and commutes 60 mi/ day for work. He says the commute is a grind, but living at the lake also has its rewards. He keeps a pontoon boat and a small John boat for fishing. No mortgage and the boats cost about the same as a what a family of 4 would spend on a couple of vacations.

Not a bad deal if you like to live that way.

As for renting the place out, it can be a hassle, but the internet seems to have simplified a lot of things, online booking engines & whatnot. I would think a big thing would be finding a good handyman that can be called on when things break. The other really big consideration is how many months can you go without having the place rented? The bank will want that payment every month regardless.

If you buy it with your dad, get everything formalized and once you & your dad have made a deal, let the rest of the family know how things are worked out. Otherwise, your siblings may assume that dad bought you a lake house and that could cause resentment later on.

 

[LineSkiCat14]

Awesome information for the other side of things: actually renting it out.

That's almost exactly how I'd do the setup. Eventually spend more and more time there as I get older. Buy the boats used. Pontoon is good for saving on gas costs.

There's definitely some hardships: many more rentals than a solid 12-months for an apartment, means more weeks of no income. Also, how to go about cleaning it every week. Driving there and back weekly (or more), just to clean the place, could be a nightmare. Do you rent the boats out? What does that entail? The only easy part now is what you said, it's all online. Booking, payments, even management.

IDGAF what family thinks to be quite honest. I'll be on a boat and won't be able to hear them too well. I'll give them a 20% discount to rent it out of they want.