Buying your own holiday home can be a very tantalising idea. And it’s easy to see why when you consider the benefits that owning a weekender potentially brings. These can include:
This is one of the biggest selling points of owning a holiday property. In theory, you can have unlimited access to the property, so whenever you want a sneaky weekend away, it’s yours for the taking. Even better, your friends and family can share the love. However, in practice, this depends on the tenancy agreements you have in place and/or seasonal demand if it’s listed on Airbnb.
Owning property can be hard on your wallet once you account for ongoing costs such as upkeep and insurance. Renting your holiday home out to tenants or other holidaymakers can bring in welcome income to offset these expenses.
If you buy wisely, the property could rise in value over time. While this can mean you make a profit when it’s time to sell, you’ll have to pay capital gains tax.
If you rent out the property, some of your expenses may be tax-deductible, such as maintenance and repair costs as well as the interest on your investment home loan. However, the ATO has strict rules governing this, and you can only claim for when the property is genuinely available for rent.
Looking further down the track, if you like the holiday home’s location and the neighbourhood has everything you need, it could potentially be the perfect property to live in when you’re retired.