This is the question everyone seems to be asking: “Is this the right time to buy a second home?” The message depends less on your circumstances and more on your market. Has the market in the area you wish to buy fallen by more than 25%? Could you rent your dream cottage for more than the monthly expense? How much more? Last week at the distressed real estate conference I attended, many ‘experts’ opined that real estate values should be set by the revenue they can produce. So even if you do not intend to rent out your second home, you should be mindful of their rental potential when evaluating their proper pricing.
The good news is for many real estate markets, including the hardest hit (Michigan, California, Nevada, Florida) the rental revenues now equal the the sales values for many homes, even those not selling at distressed prices (bank owned and short sales). This may be another sign that the markets are at or near or maybe even beyond the bottom.
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