Buying a second home can mean never having to worry about lodging on your vacation again. It can also turn into a source of income when you rent it out to travelers – or profit down the line, if you want to sell it.
However, cabins in the woods, oceanfront cottages and mountain hideaways all come with the same kinds of costs as your primary residence, but without the tax deductions. One plus: The Internal Revenue Service says if you rent a vacation home for less than 15 days out of the year, you don’t need to report the income.
Before taking the plunge to buy a vacation home, find out how your taxes will be affected, decide whether you’ll engage a property management company to oversee the rental and what kind of maintenance costs the property is likely to sustain.
Read on to see which parts of the U.S. might be the most lucrative for your vacation home. Median home values come from Zillow.com.