By now you have probably seen or witnessed first-hand Miami’s white sandy beaches, legendary nightlife, and year-round action packed events. So, you’ve decided that buying a second home in Miami is a great idea, and it certainly is!
It’s a big step, and it’s important to know what you’re getting into before you make a purchase. Getting some of the basics out is what we’ll cover today, and here’s all you need to know.
Buying a Second Home in Miami – The Motivation
The first step to take before making a move to Miami is to think about your motivation for doing so. Knowing exactly what you are after can make things easier when it comes to selecting between an apartment or a house, its size and facilities, which neighborhood to reside in, and, most importantly, budget.
Here are a few reasons to get you started:
Vacation
Owning a second home in Miami would mean you can enjoy vacaying any time you like. Specifically during the winter when the weather throughout most of the other states is far from ideal, especially if you’re not a winter enthusiast.
Moreover, you can save a lot of time and money that would otherwise be spent on bookings, Airbnb’s, or hotels. Other than that, you can cut your vacation short at any point without worrying about any financial implications.
Retirement
Some people like to get a head start on their plans for retirement, and this means moving to Miami.
The city’s warm weather, clear waters, and sandy beaches are a perfect retirement place, in addition to the numerous impeccable fine dining options and cultural events to look for.
According to a last year’s study, Miami has become America’s 5th best city for retirement.
Investment
If you’re looking to diversify your portfolio and invest in real estate, adding a Miami home is one of the best ways to make it happen. The biggest advantage is the rental income you can acquire, while seeing your property’s price increase in the meantime.
Miami’s real estate market is quite competitive, especially with the latest luxurious residential building being built. If you’re looking to invest in Miami, now is the right time to do so.
Residence Type – House vs Condo
By now, you might know what motivates you to buy a second home in Miami, and now it’s time to select the type – a house or a condominium.
Condos are by far the property with the least things to do compared to a house. In a house, there’s always something that needs to be taken care of, so this might help you in your decision.
Moreover, in a Miami condo, you already have accessible utilities at any hour, such as a pool, gym, or rooftop bars. One of the best conveniences there is about a condo is the ease to lock up and leave once you’re out the door as there’s only one way in.
Owning a house, on the other hand, has many other benefits, such as privacy, a lot more space, possible rooms to accommodate, a private garage, and a backyard.
Renting both properties is of similar difficulty, so whichever type you decide in the end, you won’t have to worry about this aspect.
Best Neighborhoods to Consider
Each neighborhood in Miami has different things to offer, from party districts, and scenic suburban areas to sandy beaches and shopping hubs.
If you’re into a retirement place, looking at suburban areas such as Coconut Grove, Aventura, or the Upper East Side are all good choices.
Those who are into art and culture could prefer Wynwood and the famous Arts & Entertainment district, while more family-oriented homeowners will probably want to look for condos in Edgewater Miami.
And if you’re a surf enthusiast and are looking for a beach house, then look no further than Miami Beach, Sunny Isles Beach, or Bal Harbour.
Once you decide in which neighborhood to reside in, it’s best to also consider the association rules, especially for condos. Take into account various fees, pet policies, and rental restrictions, which will make your life much easier once you move in.
How to Finance the Purchase of Your Second Home
The next thing you want to consider before buying a home in Miami is how you’re going to finance it and the basic costs that come with the property.
If you don’t pay with cash, you’ll need to check the financing eligibility of the property. There are different rules for mortgage lenders in regard to rental properties vs vacation homes.
It is easier to get a loan for those seeking a second home, so expect to pay at least 0.50% higher interest rate in any case. Down payment requirements are 20% to 25%, while condos may require a 40%+ down payment.
Consider your annual budget to fit in the costs of ownership, as you’ll need to pay for utilities, insurance, property taxes, condo association fees, and furnishings, depending on the property you acquire.
Navigating these financial responsibilities may ease your decision-making and make your home buying journey a pleasant one.
Summary
Buying a second home in Miami can be exciting, but it is essential to know your motivations first.
Understanding your goals will help you decide on what kind of property you want to own there.
Be it a condo or a house, both have their advantages and disadvantages, as we have outlined above, and picking the right neighborhood is important as well, considering your preferences and needs.
Financing the second home requires checking eligibility, interest rates, and annual fees associated with the property.
Therefore, planning ahead to buy a second home in Miami is of utmost importance in order to transition smoothly to your Miami dream home.
