Considering Buying A Beach House and Will Rent Out (OBX)

[Anonymous]

Has anyone done this and what was your biggest regret?

[Anonymous]

My in-laws just sold their house after owning it for 30+ years. After I saw the headaches it caused them, I would never in a million years rent a beach house, especially once that I was renting out.

I would start by asking what you're hoping to gain by buying and renting out a beach house, OP. Serious question. My advice would vary depending on your answer.

[Anonymous]

Anonymous wrote:My in-laws just sold their house after owning it for 30+ years. After I saw the headaches it caused them, I would never in a million years rent a beach house, especially once that I was renting out.

I would start by asking what you're hoping to gain by buying and renting out a beach house, OP. Serious question. My advice would vary depending on your answer.

The bolded should say "buy".

[Anonymous]

It depends on your financial status. If you really need to rent it out for 12 weeks a year to pay your mortgage, it is not worth the time and hassle. If you are OK with only renting it out a few weeks a year and using it yourself, then it is probably OK.

[Anonymous]

Anonymous wrote:My in-laws just sold their house after owning it for 30+ years. After I saw the headaches it caused them, I would never in a million years rent a beach house, especially once that I was renting out.

I would start by asking what you're hoping to gain by buying and renting out a beach house, OP. Serious question. My advice would vary depending on your answer.

We have been renting this house for 15 years and love it. It’s now on the market at a decent price (not a bargain, but fair) so we are considering buying. We don’t have to rent it out, but it would impact our savings rate If we didn’t so we want to mitigate costs.

[Anonymous]

OP again. We would use a management company to manage the rental aspect.

[Anonymous]

We go to the corolla area every summer. There are SO many houses for sale every year. It can't be a good investment.

[Anonymous]

If you don't look at it as a way to make money, then you may be OK. Beach houses, especially ones that you rent, are EXPENSIVE to maintain.

[Anonymous]

The owners who succeed in this long-term grew up there and know the area well, and/or make rentals their primary business. Either is a critical advantage to make their clients happy, and it eliminates the need for a management company, which is the surest way to fail, for two reasons: it eats up profit and also doesn't ensure the best service to customers.

In other words, your plan needs tweaking or scrapping, OP.

[Anonymous]

Anonymous wrote:

Anonymous wrote:My in-laws just sold their house after owning it for 30+ years. After I saw the headaches it caused them, I would never in a million years rent a beach house, especially once that I was renting out.

I would start by asking what you're hoping to gain by buying and renting out a beach house, OP. Serious question. My advice would vary depending on your answer.

We have been renting this house for 15 years and love it. It’s now on the market at a decent price (not a bargain, but fair) so we are considering buying. We don’t have to rent it out, but it would impact our savings rate If we didn’t so we want to mitigate costs.

PP here. An important factor is the location of the house -- is it oceanfront? Those are insanely expensive to maintain and with beach erosion, are constantly being pummeled or swallowed by the ocean. If you rent, it's even more expensive because renters treat your house and stuff like crap. My in-laws' home was beachfront and was rebuilt a couple of times over the 30+ years due to storm damage, and most recently they had to pay $50,000 to have the house moved back 50 feet (beach erosion).

[Anonymous]

For me, it worked pretty well. I bought a beach townhouse/ condo from my aunt when they upgraded. This was in 2001...For about 10 years I rented it out in the summer. I paid 110K for a two bedroom Bayfront in DE. When I rented it, it would be rented out every week from about Memorial Day to Labor Day, abut 14 weeks per year; rent averaged 1500/month (less in in June, more in July-Aug)...And some years, I could pick up 1-2 weeks in Sept .

Bottom line is I broke even from a cash perspective (except for depreciation, which gave be about 2K in tax savings). After 10 year, I started using it instead; I had paid it off. We sold it last summer as we wanted a bigger place and got something inland a bit. Sold it for 400K.

[Anonymous]

OP here. It’s not oceanfront so less wear and tear. We aren’t looking at it as an investment, or at least not a wise one, which is why we want to rent it out to limit loss so we can continue investing in the market.

[Anonymous]

I'm considering doing the same thing in Delaware and I need someone to give me a reality check as to why this will be a PITA.

[Anonymous]

I'm from an area near the outer banks. People who bought a beach house to use it quite a bit throughout the year, and rent it the rest of the time, were fairly happy with the arrangement. But, they lived within a two hour drive and enjoyed spending time at the beach off season in OBX.

A coworker inherited a cottage, and after getting to hear him deal with all the issues after storms, I decided I would never want to buy. His cottage was not on the water, but still usually had storm damage.

The only way I would buy a cottage on the obx is if I had lots of vacation per year, planned to spend a fair amount of time there, and if I wasn't dependent on rental income to be able to afford it.

[Anonymous]

Oh yeah, someone has to prep the cottage for potential hurricanes as well.