I have taken some time away from the blog to focus on returning to school, but on a recent vacation, we encountered a new dilemma and I wanted to share it with our readership. The decision on whether to buy a vacation home or endlessly roam.
Not All Vacation Homes Are Created Equally
Some of our friends and likely some readers will picture a vacation home as perhaps more than it really is. We won’t be buying any property in the Hamptons any time soon.
For global travelers that read this blog and have wondered how expensive it would be to live in a country they have visited, this is for you. You, my dear reader, will understand that some parts of the world offer very affordable housing when compared with Western Europe and North America. A second home or a vacation home doesn’t have to be an opulent purchase.
In Fort Myers, Florida we shopped two bedroom condos for $85,000 a few years ago (we didn’t purchase), when we were living in Thailand, a new studio apartment three blocks from the beach could be purchased for $20,o00, a one bedroom for $50,000 and a two bedroom/two bathroom for just $80,000. Closer to home in Mexico a new one bedroom, one bathroom home can be had for less than $25,000 outside of major metro areas or those in need of refurbishment from $15,000-100,000 in the center of Mexican towns. The image below is an example of what a property for sale in Mérida would look like before renovations and the casa in blue is what one could look like after a remodel.
Happy In Mérida
After our first visit to the laid-back city of Mérida, we instantly fell in love. The city is vibrant, the people are friendly and the weather is just how we like it…
It could be that we had the most gorgeous Airbnb (that I actually damaged the last time we stayed there) that made us want to move right in. After our first night wandering around the plazas and eating the local cuisine, we knew there was something special about this place. It didn’t take long before we were looking up properties for sale and discussing plans to renovate, bring our families and host on Airbnb while we are back home.
As we sat at the table that evening, looking at properties and discussing the logistics of how we could make it work, I felt a part of me starting to pull back from the idea.
But We Still Want To Roam Elsewhere Too
We are nomadic and constantly crave new adventures. If we owned a home in Mérida (or any other corner of the world), would we feel the need to visit our holiday home at every opportunity instead of exploring a new place during our days off from work?
Our family has always made travel one of our top priorities. We make different decisions than most of our peers, decisions that allow us the freedom to be able to roam. Maybe it is that we don’t tend to lay roots: we live in a small home, we lease vehicles, we homeschool. I wondered to myself if the idea of buying a home in Mérida is planting a root or if I am overthinking this all together. Maybe I need to look at this as more of an investment or an experience.
Or maybe I am just ready to roam somewhere I haven’t been yet.
>Read More: All the Hotel Points in the World Can’t Beat This Airbnb
What do you think? Does buying a vacation home take away from exploring other places?
Merida is safer than most of Mexico, but not worry-free. https://www.tripadvisor.com/ShowTopic-g150811-i426-k10868342-Crime_in_Merida-Merida_Yucatan_Peninsula.html
I think it is fair to inquire, so I did take a look and the Yucatan state is the safest in Mexico. The murder rate (common safety metric) is 2.2 per 100k – compare that with St. Louis (64 per 100k) Baltimore (51 per 100k) even sleepy Omaha (6.7 per 100k). We are actually “safer” in Mexico than we are at home in Pittsburgh (18 per 100k).
I own many rental/vacation properties in several cities in different counties including Mexico. The most important thing is you have a dependable and HONEST and ethical property manager. That’s the difference between success and a major liability.
It definitely can work but you can also have hassles and issues as well. It makes it much easier if you utilize technology and put things like Nest/Yale Lock, Nest Cameras for the outside entrance, etc.
My property in Mexico is really successful and make great net income on it. But I have a good property manager that is a friend of a friend so it makes it much easier.
That’s really helpful. We use similar technology for when we are away from home. If we choose to purchase in Mexico, we will probably find our “team” before we find our property. Thanks for the tips!
Traveling is my favorite hobby and my bucket list is endless. I do like the idea of staying in one place for a while, really getting to know the people and culture. However, I don’t think I would want the stress and expense of owning a home. This alone can take away the feeling of freedom (one of the things I love about travel) when you are exploring somewhere else.
We really enjoy slow travel too. It sounds like this is the same dilemma we are having.
As someone who’s seen several friends and relatives fall into the trap, I’d tell you to think twice, because foreign real estate is almost always a sucker’s game, especially in countries with corruption issues like Mexico. No matter what promoters might tell you, your maintenance and “dealing with bureaucracy” expenses are going to significantly exceed what you’re made to expect, which ends up making the house a poor investment/economic decision much of the time. And if you do run into problems (such as a squatter), the chances of a gringo getting a satisfactory resolution through the Mexican legal system aren’t great. Unless you have connections and are willing to pay, which goes back to making the economics poor. This is a long-winded way of saying, toss the “it’s an investment” idea into the trash, unless you have the time and energy to treat it like a business. Chances are it won’t work out the way you expect and just make you regret your choice.
A vacation home might make sense if a) you have a reputable property manager that can take care of things while you’re not there and/or rent it out for you, and b) you plan to stay there enough that the maintenance and property management expenses are less than the cost of accommodations. But yes, there always will be the issue that you can buy plenty of airfare and hotel rooms elsewhere for the amount you’re spending.
I think we are leaning more towards vacation home… with the occasional Airbnb. We do know a reliable property manager which would make us feel better while we are away.
For me [another] variable to think about is that essentially you’re making an investment in a foreign currency. We have a small home and a tiny apt in NYC. It has been a great buy for us and we spend 4-5 months a year there but the reality is a second home does encroach on traveling more widely. Financially it has an impact but beyond that you want to make use of it and that limits the time you have to go elsewhere. My question would be what does buying get you that you can’t get from the Air BnB? That said I was in Merida over 15 years ago and I can see the appeal…
That’s a fair question. The biggest factor is probably perfect availability. Our favorite property is unavailable for us the next three opportunities to visit. The same could be said for buying a property in the U.S. where home ownership costs plus interest, plus mortgage easily outpaces renting in the long run, yet we prefer to have something to call our own.
I strongly advise against being an absentee landlord, unless you have a deep pocket and an extremely competent and honest property manager, be it a company, a relative or a family member. Forget about overseas investment property when you don’t know the language, culture and laws. All states in the country are extremely tenant friendly. But home ownership is a great investment tool when you can manage and afford the costs because it appreciates over decades when money loses its value. An investment property has greater value than that of a vacation home, and you have more time and opportunity to travel to more world wide destinations. The higher the risk, the greater the reward. Unsure if you own, meaning a free and clear, a house or rent but reading your account of leasing vehicles and home school, I can see you won’t be financially set for retirement, be it by choice or circumstance. I will make home ownership a top priority before planning to jet set overseas annually. Leasing a vehicle is money down the toilet, unless you are a realtor when you must show off your phantom success. Home schooling, in my opinion, is to deny my child from developing social interactions and interpersonal skills. The best freedom that I appreciate and grant myself is to be debt free because I won’t be at the mercy of the employer, the lender or landlord.
Respectfully, I think you’ve made more assumptions about our personal situation than are represented in the post. It would be difficult to discern with any level of accuracy our ability to retire comfortably without seeing our broader financial picture.
“For any of the global travelers that read this blog and have ever wondered how expensive it would be to live in a country~~~~~,~~~~~~ they have visited this is for you. “
RMH- Thanks for bringing that to my attention. It was awkwardly typed and I have corrected it.
Do you have the link to the Airbnb you stayed in Merida? I looked for it on Airbnb but couldn’t find it based on your photos.
Hi Mike, check your email.
Having worked on small construction projects outside of the mainland US as well as having first hand information from others experiences, my advice is buy something already finished. Non-US building practices, local payoffs, regulations, work cultures will have you in tears and tearing at your hair in frustration.
We have a vacation home that we use frequently and do not rent it. Yes, it has curbed our travel somewhat but we still take planned trips. Maybe it’s our age or our son’s age but we are at point in our life where our own waning wanderlust has collided with our son’s exploding social life so we are happy to have a vacation home we can share with friends and family.
A word of advice, if you envision including your friends, family and your daughters friends joining you, give careful consideration to accessibility.
A close friend bought their dream beach house, only to learn tbeir kids/grandkids and friends and relatives tired of the time commitment to reach it more than once a year.
Heather – I always appreciate your comments and your insights. If we decide to take this journey, I will be sure to update as we go.