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Buy Now, Retire Later-An Investment In Your Dreams by: Elaine VonCannon Owning A Second Home Is Easier Than You Think Buying a second home is a serious financial commitment, but it is can also lead to a feeling of complete freedom. It can provide you with a vacation home, a place to escape from your mundane routine and an investment in the future for when you retire. Aging and wealthier households, smaller families and new technologies that allow professionals to work from remote places are all significant demographic trends. These trends indicate that buying a second home is becoming a more reasonable option for many Americans. The recent changes in tax laws are also making second home purchases more affordable. Strategically planning your purchase, consulting a trusted professional and taking your time are the keys to making the perfect investment. Strategies For Retirement Investments Planning for retirement early is smart, especially now. Many experts believe that as the Baby Boomer generation gets closer to retirement property values will increase at a rapid rate. More people will be buying second homes in high demand locations so locking in a lower price now can save thousands. If you are buying a house you want to retire in later be certain to consider all the possible changes and growth for the area. Many times development and increased populations change the face of a seemingly perfect location within just a few years. Another alternative to consider is investing in a home and using it as rental property first. At retirement you can choose to improve and make the rental home your primary residence. You can then sell or exchange and buy the retirement home of your dreams. Tax Advantages Can Be Found Everywhere Regardless of the avenue you take to invest in your retirement, the IRS offers tax advantages in a wide variety of ways. Mortgage interest and local and state real estate taxes are all deductible if you live in your second home a portion of the year. Write offs are limited to two homes. If you rent the home for less than 15 days you do not have to claim the rental income or pay taxes on it. If you rent your second home more than 15 days you must report the rental income. However, now all of the expenses used to run the property are deductible. Property taxes, interest, insurance, repairs, utilities, supplies, cleaning and maintenance are all considered expenses. Equity in your first home can also help with the purchase of a second home as a retirement investment. A home equity loan or line of credit can be used to cover the down payment on a second home. Be aware however, that borrowing in this way only allows the first $'100
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