Vacation Homes
Waterfront and mountain properties can make great getaway points and can also be
a good investment. Programs are now available which enable Canadians to purchase
a vacation home with as little as 5% down and still maintain a very attractive monthly
payment.
Depending on the intended use and location, some vacation/second home programs offer
loans up to $700,000. Please note that most of these programs are not structured
for investment, rental pool or timeshares, so rental income will not be included
in the qualification process. In addition, there may be additional restrictions
on living units, etc., depending on the program qualifications.
One of the more desirable aspects of these types of programs is that the property
restrictions, again, depending on the use, are greatly restricted. This allows the
inclusion of cabins, cottages and other vacation properties that may be usable or
attractive during certain times of the year. For instance, a cottage that has not
been insulated or otherwise made usable during the winter months could still qualify
for this program.
As with a standard mortgage loan, fixed, variable and capped variable mortgages
are available with these programs and the amortization periods are also comparable
to a standard mortgage loan. Although the purpose of these homes may be purely recreational,
the property should still be considered an investment, and due diligence should
be done in terms of researching the probability for resale and of increasing market
value.
Properties offering easy accessibility to both winter and summer activities are
of particularly worth of exploring as vacation homes, since they are likely to increase
in value and will have broad market appeal at resale. If a vacation home is part
of your plan, Ratesheet.ca can help you find a broker with the experience and expertise
to guide you through this exciting purchase.
