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Tips buying a second home

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7 Tips for buying a second home

Considering buying a second home? Whether you are looking for an investment second home, a holiday home or a place to enjoy your retirement? Consider the following 7 tips: 

1. Financially wise?

Whether you are an investor or not, it is always important that buying a second home is financially a good considered move. There are costs that always stay ahead also if you are not there, think of insurance, taxes and charges for utility services.


Renting your second home can be a good solution to cover costs. Calculate in advance what your monthly expenses are and what your expected  rental incomes will be. Some homeowners keep the renting period as low as possible so that the monthly costs are covered. Other earn money with it by renting it actively.
More on rental.

2. Where and what?


Buying a second home on a poorly chosen location will not cover all needs. The house is difficult to sell and rent. You need to find a good combination of two worlds: rational market research and the second home should match your personal preferences. Consider factors such as the strength of the local economy, trends in the housing market, the convenience and facilities in the area, property tax rates, the quality of the local schools and medical care, etc.


What type of home?

The type of second home you are buying is important. The costs and needs are different per type of house. An apartment has different needs then a villa on the beach or a cottage on a ranch. Which type you prefer depends also on factors such as costs, location and maintenance.

3. Second home tax

When buying a second home you should pay taxes. The taxes you have to pay depends on the country where you live and in which country (which vary sometimes even by state and city). If you rent your second home, you also have to pay income tax.  Below you find the taxes per country:

-          Taxes in Spain

-          Taxes in France

-          Taxes in Austria

-          Taxes in Turkey

-          Taxes in Italy

-          Taxes in Portugal

-          Taxes in Hungary

-          Taxes in Bulgaria 

4. Cash or Mortgage?

Most people pay their second home with a combination of cash and a loan for the remaining amount. The higher your amount of cash, the lower the loan or the higher the mortgage.


20% cash

When buying a second home at least 20% of the purchase must be made in cash. If you do not have this you it may be necessary to look for more creative solutions, but for this you should make an appointment with a financial specialist. Think of the equity in your first home, or retirement.



Most people take a loan when buying a second home. Various mortgages are available, so make an appointment with your bank and discuss the possibilities. Prepare yourself for this meeting by setting your short-and long-term financial personal goals. Ask yourself what (big) expenses you will have in the next 5 – 10 years.   

5. Consider non-traditional financing

Family and friends

A different way to finance your second home is the "Bank of family and friends". Borrowing from parents, brothers/ sisters, or close friends can save thousands of dollars interest.


Share a holiday

Another cost-saving approach when buying a second home is to share a house. Shared ownership is a growing trend - but do not rush into taking this decision. Make clear agreements in an official document and try to cover all situations. Think of agreements regarding distribution costs, when and how long should whom be in the second home, but also what to do when someone dies.

6. Active rent?

Some owners want their second home actively hiring. The idea to make a profit from the rental of their second home costs a few years. If you have a good occupancy it is certainly an option to offset the costs.

You will assume the role of a landlord, which means more than just your intuition to follow.


• Finding good, reliable tenants.

• Understanding and preparing leases or short-term appointments.

• Dealing with on-going maintenance and repairs.

7. Protect your second home

Prior inspection

Protecting your home starts before you buy and continues long after. You want before you buy to make sure there are no problems and therefore do a prior inspection. Problems such as repairs, condition of the house and other maintenance can be prevented.



Your lender will also require that you take a risk insurance cover, to protect your property from damage and causes such as theft, fire, flood or storm to wear. The cost of insurance for second homes is generally higher than for the first houses, because you are not so often are.

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