The main appeal of buying property in a tax haven is the ability to walk away without having to pay capital gains on the sale. In general, houses in non-profit organizations with a 501(c)(3) status are tax-exempt, meaning you avoid paying high California taxes on the sale of real estate. Additionally, you are entitled to claim certain expenses as a home-owner, making your property more of a financial investment than a vacation rental.
Getting The Best Possible Price
As tempting as it is to purchase a vacation rental in paradise, the best price usually comes from someone who knows what they are doing. For instance, if you contact the agent of a well-known luxury hotel chain, you can likely expect to get a good deal because the hotel needs to fill its rooms, and you are probably the only person who is interested in that particular property at that moment. In general, the more luxurious the hotel, the more attractive it is to travelers, meaning there is usually a premium market for that brand. A similar strategy can be applied to other hotel chains or individually-owned luxury properties. Knowing the right people can make a world of difference when shopping for a vacation rental.
One of the appealing aspects of vacation rentals is the ability to profit from increased demand. Because they are not tied to a particular hotel or real estate broker, rental agents are able to match buyers with properties that are currently under lease. For instance, if you know that a popular luxury hotel is about to close down its properties in a certain destination, you can engage the services of the local real estate agent, who will be able to match you with a vacation rental that the hotel needs to fill its rooms. The agency will receive a commission from the hotel, and you will get what you want – a luxurious retreat that you can afford because the money is coming from another source. Similarly, if you are interested in a self-sufficient lifestyle, you can purchase a vacation rental that is already set up for you to live in and enjoy close to the most luxuries money can buy.
In some instances, the upside from a hotel’s perspective is that the hotel can charge what it wants because the market is saturated with vacation properties, meaning there is little to no competition. However, as hotels continue to close down in luxury destinations worldwide, savvy travelers will have more options than ever before.
More Than Meets The Eye
One of the main attractions of owning a vacation rental property is the flexibility it provides. In today’s world, many of us are working full-time jobs to make ends meet, with many precious vacation days going unclaimed because we are too busy working. With a vacation rental, it is possible to have a second income source to augment your regular income. You can do this by taking on additional clients, or by extending your properties’ rental periods. The upside for the homeowner is that they can have some additional cash flow, and the flexibility to spend more time with their family, or to pursue leisure activities they have always wanted to try. For those looking for that extra money, or wanting to try something different, the appeal of a vacation rental is undeniable.