Thinking of buying a vacation home in Telluride? With ski season just around the corner, it would be great if you can simply hop on a plane and hit the slopes without the hassle of finding and booking a place to stay.
Before shopping around for a ski home, however, make sure you’ve done your research and are ready to be a Telluride homeowner.
Here are some important things to consider:
- Is a Telluride home a good investment?
According to the MLS, home values in Telluride increased9% in October 2019 compared to October, 2018, and are predicted to significantly increasewithin the next year. Home values have been trending up since 2012, and this is seen to continue in the foreseeable future.
If you buy a home in Telluride now, you can avoid the expected rise in prices over the next few months. Moreover, the consistently increasing home prices suggests investing in a Telluride property is a good move. You can expect your asset to grow in value and give you good returns when you decide to sell it in the future. If you plan to use the property as your retirement home, buying now will give you great savings when the time comes.
- What kind of property should you buy?
Do you prefer a single-family home or a condo? In Telluride and neighboring Mountain Village you get plenty of options for both property types.
Homes in Telluride run the gamut of sprawling estates to cozy cabins. Condos range from relatively affordable studios to luxurious suites with five or more bedrooms. You can choose a property in rather isolated locations surrounded by nature, or in the historic downtown area, close to restaurants, bars, cinemas, and cultural destinations.
In addition, there are homes catering to various recreational and lifestyle preferences, such as ski homes, golf homes, equestrian properties, and riverfront homes.
- How will you finance the purchase?
Do you plan to pay in cash or through a mortgage? Cash payment will give you the edge over other bidders for a home.
If you’re buying a vacation home and plan to take out a loan for it, it’s best to start early as the mortgage process for a secondary home is typically longer. Make sure you have a good credit score – lenders consider a second home to be a riskier purchase, especially when you’re still paying mortgage for your primary home. Additionally, be prepared to put a down payment of at least 20%, the standard rate for vacation homes.
Buying a second home also means spending on the repairs and maintenance of two homes at the same time. Factor in the added costs to your monthly budget.
Other additional expenses to consider include home insurance and property taxes. You might also need to pay monthly homeowners’ association fees.
- What’s a fair price for a Telluride home?
Luxury properties make up a large portion of Telluride real estate, and one of the challenges in buying high-end homes is determining a good offer price. Your offer should be competitive, but at the same, you’d want to make sure you don’t end up paying more than you should.
Avoid going by the seller’s asking price without first reviewing if it’s fair. Work with your Realtor in determining a good offer. Look into comps, or the prices of similar homes that recently sold in the area. Factor in the features that make the home you’re interested in more or less desirable than the comps.
In addition, see how long the home has been on the market. If it’s longer than the average, the seller might be more motivated to accept a lower bid. If the demand for housing is greater than the supply, you may have to find ways to make your offer more competitive.
- Will you rent out the home?
If you plan to rent out the property when you’re not using it, look into features that will make it attractive to renters. A ski-in ski-out home is guaranteed to attract renters and may even get you a premium on the rental rate. Consider properties close to the Telluride – Mountain Village gondola, as well.
Keep in mind that you will likely want to use the property yourself during ski season. But Telluride is also a hot draw during the summer, thanks to the numerous warm weather activities in the area and the town’s prestigious summer events and festivals. This could be a good time to make an income from your home.
How often you rent out the property can affect your taxes. If it’s more than 14 days a year, you may need to pay taxes for the rental income you make, but you can deduct your operational expenses from your taxable income.
Check out this blog postfor information on the tax benefits you can get for your Telluride home, and see this page for a comprehensive home buyers’ guide.
For expert guidance in buying a home in Telluride, call us, Team TD Smith, at 970.729.1577 or at TD(at)TDSmith(dotted)com