Ok, let's say you wanted to purchase a condo at the beach

[DawnM]

DH and I have discussed this.  We are not really doing it any time soon, most probably the earliest would be once the older two are finished with college, but it is a consideration.

We are finding that we can afford:

A. a townhouse a block or two from the beach with no view

OR

B. a townhouse with at least an ocean view that we would need to rent out at least 50% of the year in order to pay for it (which is totally doable, we have friends who do it.)

Which would you do?  I LOVE the idea of ocean right there and really feeling like I am AT the beach, but I also don't like the idea of having other people in my house, needing to keep it clean/not personal, etc....

We would love to find someone to go in on a place 50/50, but we don't have anyone who wants to or can.  Maybe in the next few years we can.

[Pawz4me]

I know many people who own homes at the beach. Some rent, others don't. I don't want strangers sleeping in my beds and using my stuff. So I vote for a block or two from the ocean with no view. There are also lots of IRS rules if you claim rental income and expenses.

[Arcadia]

How near is B to the ocean?  We have severe erosion at Pacifica, California so we would rather be further away from the cliff and no view than have an ocean view but worry about erosion. 

My university dormitory faces the ocean but is probably more than two blocks inland. It’s an unblocked view as it is on a much higher ground than the buildings nearer the coastline. The number one complaint is that the sea breeze corrodes the electrical appliances faster.  I am scared of wind chill so I didn’t open my single room dorm windows. For someone who enjoys cold sea breeze while cramming for exams, the location was wonderful.

There are some nice homes near the Capitola Beach (California) but we didn’t like the lack of privacy as it is just steps away from beach. Nice location for hotels but I won’t want that location as my residence. I would rather buy somewhere about 15 minutes walk away from that beach. If it’s cheap enough to buy as a summer vacation home, then I would consider as I am an extrovert and won’t mind being surrounded by tourists all summer (but not year round, privacy wins) 

[Annie G]

I wouldn’t want the hassle of dealing with the rental. You’d need to pay someone to clean between guests and stuff. How far would you be living from the beach place? 

[Jann in TX]

We have friends with a condo near the beach- and we've stayed there a few times.  No view from their unit-- but the complex has a landscaped walkway (with benches and some tables) down to the beach and their unit is close to that.  We've never felt that we missed out not having an ocean 'view'. 

[DawnM]

20 minutes ago, Annie G said:

I wouldn’t want the hassle of dealing with the rental. You’d need to pay someone to clean between guests and stuff. How far would you be living from the beach place? 

 

About a 3-3.5 hour drive to the beach house from our primary residence.

[DawnM]

37 minutes ago, Arcadia said:

How near is B to the ocean?  We have severe erosion at Pacifica, California so we would rather be further away from the cliff and no view than have an ocean view but worry about erosion. 

My university dormitory faces the ocean but is probably more than two blocks inland. It’s an unblocked view as it is on a much higher ground than the buildings nearer the coastline. The number one complaint is that the sea breeze corrodes the electrical appliances faster.  I am scared of wind chill so I didn’t open my single room dorm windows. For someone who enjoys cold sea breeze while cramming for exams, the location was wonderful.

There are some nice homes near the Capitola Beach (California) but we didn’t like the lack of privacy as it is just steps away from beach. Nice location for hotels but I won’t want that location as my residence. I would rather buy somewhere about 15 minutes walk away from that beach. If it’s cheap enough to buy as a summer vacation home, then I would consider as I am an extrovert and won’t mind being surrounded by tourists all summer (but not year round, privacy wins) 

 

No cliffs.  

[Annie G]

1 minute ago, DawnM said:

 

About a 3-3.5 hour drive to the beach house from our primary residence.

That’s close enough to use it often so that’s good! My sister is about 2.5 hours from her beach condo and keeps a lockbox on the door like a realtor so people can get in without her being there. That’s nice!  But if you’d need to rent it 50% of the time that sounds like a lot of work. Is it for your friends who do it?

[freesia]

No advice, but when Hurricanes are hitting the coast is usually the time that folks decide NOT to buy a condo at the beach.  It must be like how I want ice cream on cold days. ?

[DawnM]

Just now, Annie G said:

That’s close enough to use it often so that’s good! My sister is about 2.5 hours from her beach condo and keeps a lockbox on the door like a realtor so people can get in without her being there. That’s nice!  But if you’d need to rent it 50% of the time that sounds like a lot of work. Is it for your friends who do it?

 

Is what for my friends who do it?  Would I rent to friends?  No, that isn't my intention.  

The realtor we talked to said if we rent out 100% in the summer, it would pay all of the mortgage.  We are thinking we wouldn't do that, we would try to rent enough to cover 50% of the mortgage if we rent out.  Was that what you were asking about?

[Chris in VA]

37 minutes ago, DawnM said:

 

Is what for my friends who do it?  Would I rent to friends?  No, that isn't my intention.  

The realtor we talked to said if we rent out 100% in the summer, it would pay all of the mortgage.  We are thinking we wouldn't do that, we would try to rent enough to cover 50% of the mortgage if we rent out.  Was that what you were asking about?

She's asking if your friends find it to be a lot of work. 

[DawnM]

1 minute ago, Chris in VA said:

She's asking if your friends find it to be a lot of work. 

 

Oh....gotcha.  Sorry, my brain is on the hurricane right now!

No, they have a company that does the management for them.  But they do have to put in the cleaning cost into the rental cost.

[Carol in Cal.]

1.  I'd price flood insurance and double it in my budget.  I suspect that that is going to get a lot more expensive in the not too distant future.

2.  I'd insist on getting rental records for several years of a comparable place, and I'd also study in season and off season rental rates in the area.  If I went with the rental I'd set aside a year's mortgage payments in a bank account in case something happened that prevented me from renting it out.  I would also meet with my tax guy to find out how much *I* could use the property and still write off expenses as a rental.  

3.  I would lean toward getting the sea view one if the answers to those questions left me with enough margin to feel confident that I wouldn't lose it.  A guy at church with immaculate credit bought a condo in Hawaii as an investment, and could not keep it rented enough to hang onto it through the market crash in 2008/9.  He got foreclosed on and it screwed up his credit for years; plus he was personally pretty embarrassed about it ethically.  It was something that was kind of a cautionary tale for me.  

4.  I would check on price trends in the area, and especially after the 2008/9 downturn vs. before.  When we bought our mountain cabin, prices up there dropped 50% in the years following that downturn, and that would be pretty sickening if we had bought earlier.  How would you feel if that happened to you?

[Crimson Wife]

Neither.

I would look for something on an inland lake/pond because that way I wouldn't have to worry about hurricanes/Nor'easters/etc., erosion, and the potential for sea level rise if the global warming doomsayers turned out to be correct.

[Bootsie]

Much would depend on the beach itself.  Some beachfront properties are such that a lot of people are always right outside your window because they are located on a busy public beach.  I would want more privacy than that.  

[Selkie]

I wouldn't buy a second home unless I could very comfortably afford it without renting it out. I live in a resort area where many people own vacation homes and rent them out, and so many of them end up regretting it. The rentals sustain a ton of wear and tear and just about everyone has a story about renters completely trashing the place, items being stolen from the home, etc. 

[ktgrok]

I'd check insurance rates for both areas, there may be a big difference. 

Also, a few blocks away - would you walk to the beach? If not, is their easy parking at the beach?

[ThisIsTheDay]

If I was going to move to the beach, I'd take the one with the beach view. And I'd rent it out to cover expenses. While I wouldn't mind renting a condo a few blocks away, I wouldn't buy one at this point. However, with the weather this week, I'd have a bit more hesitation . . .

[Starfish]

We have a first tier beach house and use a rental company.  I'm not up to the risk and expense of beachfront.  The rents cover expenses.  Personally, I'd buy the one with the beach view.  Sitting in the porch swing and looking at the ocean is my favorite thing to do.   Renting at the beach is all about the view and distance to the beach.  You might find using your home in the off season is more pleasant.  We've always rented out the summer season until one year I declared to dh that we were going to go the beach in July and really enjoy our house!  It was miserable -- tourist town in full swing and crowded beaches.   We now do our beach vacations in mid May after  classes are done and mid August before they start.   We also spend scattered weeks during the offseason and two in January.  It works for us.  I can't say that I'm thrilled with renting it out, but it pays the bills on the house that we wanted and makes a closer retirement possible.  

Edited September 15, 2018 by Starfish

[PeterPan]

We stayed at a condo on the beach a while back and the owner had such a pain in the butt cleaning up after people. The building had a spray spigot and shower at the beach side entrance, but apparently people didn't use it. So if you could have a property manager take care of all that and still make enough profit, fine. But me, I wouldn't want to clean up after that. It was just way more than normal messes. Like before we came she cleaned for HOURS and ran way over because the people had tracked sand EVERYWHERE.

Maybe keep watch for a deal that you can do without renting it out? And maybe make sure that you actually like the vibe of that area. Even though it's all beach, some parts will have more energy or things to do or whatever. Where we stayed was really boring and low tempo for me and ds. My dd liked it, because she likes that low tempo. But me, I was DYING.

We stayed at a gated community in Orlando we really liked. The property manager did a fabulous job, and it was, as you say, something the owners stayed in 3-4 months out of the year. They kept their personal belongings in a locked closet. I don't know if that would squig me out, but I'd buy there in a heartbeat and put up with it if I had the dough, lol. We loved the hot tub and the pool and the deck with the view. I don't know that I'd want to buy and be off the beach with no view. Now sometimes they make it so it has a view, like maybe a golf course or the tub or a balcony and palm trees. 

[BusyMom5]

I would talk myself out if it!  Between keeping it up for renters, insurance, property tax,  maintenance,  you would be better off investing it elsewhere and renting a condo yourself ?  

 

My parents have h ad property in a tourist town.  It's not as fun as you think.  They now have a second property in another yown, and it's a lot  to keep up.  

[Liz CA]

3 hours ago, BusyMom5 said:

I would talk myself out if it!  Between keeping it up for renters, insurance, property tax,  maintenance,  you would be better off investing it elsewhere and renting a condo yourself ?  

My parents have h ad property in a tourist town.  It's not as fun as you think.  They now have a second property in another yown, and it's a lot  to keep up.  

 

This. Also if you cannot offer a beach / water view, preferably even surf / white water, fewer people are willing to rent it. There will be months when nothing much happens. You are usually expected to lower the going rate for "off" months but your upkeep will remain the same during that time, so will mortgage and taxes.

 

[Crimson Wife]

Just now, Patty Joanna said:

...and insurance and cable and Internet and heat and electricity and garbage removal and water/sewer and in our case, yard maintenance and over time, building msintenance (which we did not include in the $600).  Condo fees cover some/all of this but it’s not free—and some condo associations keep fees low but have special assessments to do major work   

We owned ours outright and it was still $600 a month.  

Just do your homework.  Don’t get me wrong—for 15 years, the beach house was a tremendous joy to us...in ways I can’t express.  And I miss it.  But at some point point, it has to be affordable,  too.  

I wish i had a money tree.  

This is why my parents sold their lake condo. Between everything it was costing them $26k/year to keep it and this was without a mortgage. Now granted New Hampshire has insanely high property taxes, especially after the legislature passed some law that designated the town in which the condo was located a "donor" town to poorer ones.

Originally they had purchased it intending to retire there and sell their house in MA. But they decided that they didn't actually want to live there 6 months out of the year and it was too expensive to keep it as a vacation residence.