6 Things to Seriously Consider Before Buying a Beach House With Friends or Family
Realtors agree: These questions must be answered before you sign on the dotted line.
This article originally appeared on Coastal Living
Ahh, to own a beach house with family and dear friends. It's the sangria-infused daydream that many a summer vacation has inspired. And while co-owning a property in a coastal locale can be an enjoyable endeavor and economically sound investment, it is not without perils. We surveyed realtors who specialize in coastal properties to learn their best advice on a happy co-ownership. Here, six important questions everyone should answer, in writing, before you say SOLD!
1. Who will use it when?
No matter how cozy you are with your co-owners, chances are you'll want some private time at your dreamy new beach abode. “Many friends and family have the same weeks off in the summer, winter, and spring,” explains Santa Barbara-based agent Nick Svensson of Compass who suggests creating a calendar a year in advance outlining who gets what dates, particularly coveted holidays such as Memorial Day and the Fourth of July. Also of note: if you all crash at the same time, which in the group will get the master suite?
2. Who is welcome?
“An open house policy sounds well and good, but it's not realistic for most groups,” says Ryan Critch of Ocean 400 in Ft. Lauderdale. It's important to pin down whether or not one of the homeowners must be present during all visits—or if it's totally fine for, say, Sarah to let her beloved hairdresser use the house one weekend without Sarah there.
3. Will you rent it out?
It's may come as a surprise, but many times members of a group have different expectations on how a property will be used. Before you sign on the dotted line, you’ll want to clarify whether this is purely a vacation home or also an income property, encourages Jill Olivarez of Home Pocket in Destin, FL. If it's the latter, Olivarez suggests there be clear agreement on rental logistics and how that revenue will be divided between owners.
4. How will maintenance costs be addressed?
Wear and tear are par for the course at a beach home. (We’re looking at you, salty air and whipping wind!) As such, it's important to determine how maintenance costs will be divided among the owners. Evenly with each incidental? A percentage based on usage? Alternated by year? Sep Niakan, a realtor with HB Roswell Realty in Miami, suggests the following straightforward solution: put the property in the name of a company and have everyone contribute initial operating costs, then have expenses deducted from that account.
5. Who will select aesthetic finishes?
Most parties can come to an agreement about which air conditioner to purchase, but it can be far more difficult to get a consensus something more subjective like the color of the front door, adds Niakan.
6. What if someone wants out?
Second homes are a luxury, not a necessity. That being the case, property owners cool on them far more often than they do a primary residence. Before you buy with a group, have a clear and firm plan for how members can relinquish their portion of the property, suggests Kari Sellers of Key Solutions Real Estate in Sarasota, FL.