$100k to spend on vacation home. Where?

August 13, 2007 10:47 AM

$100k USD to spend on a "vacation home". Ideally, great activities nearby (skiing, beaching, etc) on a lake or mountains. North America or Europe. Where should we buy?

Through extenuating circumstances, I'm coming into about $100k. For that cash, I'd like to find a "vacation home" to buy. Ideally, I'm purchasing this thing outright, as I'd like to avoid a mortgage.

I'm a ski & beach person, my wife is a mountain person, or a beach person that doesn't like heat. So, if there's a blend that works that would be fantastic.

Obviously, there's the traditional ways you look for property. We're doing that. But, I thought the hive mind might be able to come up with some places or ways to get more bang for the buck, and get something that we'd love to have in our family for years to come.

We have ties to Germany in Europe, Texas and Oklahoma, and the DC area. Doesn't need to be in these places necessarily, but if something was good in those areas, that might make the deal easier (or harder).

If it was rentable as well, so that it could generate positive cash flow, that would be even better.

Is there some perfect, secret place that you would buy if you had the money? Point me in it's direction!

posted by wflanagan to home & garden (18 comments total)

they major issue you will have with purchasing anything in europe right now is that craptastic exchange rate you will get for your dollars. the euro is strong, the dollar is weak. things were different just a couple years ago and they might very well change again but if you're set on getting something over there, consider waiting a few years. plunk it into a nicely interested savings account and make 5k in a year just for the wait.
posted by krautland at 11:12 AM on August 13, 2007

For that money, you might be able to get a very modest, rustic cabin someplace way off the beaten path. Idaho, Montana, Michigan's U.P., middle-of-nowhere Texas or New Mexico, maybe.

But talk to a good financial adviser about whether it's wise to pay cash for a vacation home, in terms of tax liability and whatnot. You might be better advised to invest the $100k and use the money you make off the investment to rent a vacation home when you want to go on vacation.
posted by The World Famous at 11:18 AM on August 13, 2007

When I was in the southern Czech Republic a couple weeks ago (ceske budejovice) I saw a number of villas in the countryside advertised on message boards. Nice places going for $60k. The Czech republic hasn't gone Euro yet, so the exchange rate is still pretty good.
posted by notsnot at 11:28 AM on August 13, 2007

Try Slovenia.

Great mountains, nice lakes, coastline on the Adriatic, excellent food in Istria and Italy nearby, easy drive to Venice and other European cities.

Taint of ex-Yugoslavia still brings prices down just a little compared to the rest of Europe, but as noted above, you will get screwed by the exchange rate right now.
posted by RandlePatrickMcMurphy at 11:34 AM on August 13, 2007

Supposedly vacation time shares are steeply discounted when resold. You could buy a few and have money left over to invest.
posted by BrotherCaine at 11:34 AM on August 13, 2007

Last August, my husband and I stayed with my parents in a little cabin up at Lake Wallenpaupack in the Poconos, and it was gorgeous. Plus, swimming and mountains.

Doing a little light Googling shows some pretty cheap little cabins and stuff, probably not right lakeside, but it might be worth a look.
posted by mckenney at 11:36 AM on August 13, 2007

Uh, you might consider Lebanon. They have it all. Mountains, beaches, ski slopes. You name it. It's kind of almost in Europe.

Slovenia and northern Croatia has much of the geography you're locking for. Croatia is still pretty cheap I think
posted by uandt at 11:39 AM on August 13, 2007

If I were to buy a vacation home, it would probably be on the south shore of Nova Scotia, around the Lunenburg/Mahone Bay area. My family has a lake property in this area and I find it nice and relaxing. No mountains really, but lots of lakes in close proximity to the Atlantic. There are oceanfront beaches, but they aren't ridiculously hot. Interesting seaside towns to explore, including a UNESCO heritage site (Old Town Lunenburg). This area is about an hour's drive from Halifax International Airport. It's not overrun with tourists, but attracts enough that it's fairly easy and common to rent out cottage properties. From looking around briefly, you'd might be able to get a modest lakefront cottage somewhere a little more inland or a few acres of oceanfront land. It might be an area looking into, anyway.
posted by flying kumquat at 11:52 AM on August 13, 2007

A few suggestions for you:

First, your best option for the $100k is something that can be considered an investment property, ie a rental. This is because if you have an investment property, worth $100k now, and worth $150k in a few years, you want to be able to move your capital gains with as little tax as possible.

You do this by using a 1031 exchange, which allows you to sell your property, move that money to a new property and not pay capital gains tax on whatever value the property has accrued.

But to qualify for a 1031, it has to be an investment property. The IRS is going to want to see you rent the property for at least two years, after which, you can pretty much do as you like with the property.

Deferring your capital gains is important, because the tax is very steep, now 14%, and usually 28% of whatever money you make on the property. And 28% can add up to a lot!

If your property is increasing in price at ~7% a year (which is reasonable, even in this slumped market), that's over $7,000 a year in gains! You don't want to have to pay $1,960 of that back to the government do you?

The great thing about 1031 exchanges is that you can continue to trade them. So say you buy a $100k property now, and in 10 years it's worth $220. You can sell the property, and move up to a better vacation home. If you follow the IRS guidelines for that property to be an investment, then you can defer the taxes each time you move your capital. Eventually, when you're ready to retire, you can just buy your retirement home with this money, rent it for two years, and live in the home until you die. And you'll never have to pay the 28% capital gains on the money.

Now, for some self promotion: there are condos and homes available here in Moses Lake, Washington in the $100k price range, and the company I work for does very good property management, and this one of the fastest growing areas in the state.

Sorry for the self promotion, if it goes beyond good taste for MeFi, I'll gladly remove it.
posted by sethwoodworth at 12:02 PM on August 13, 2007 [8 favorites]

There are plenty of vacation cabins, apartments, etc. available all over the world. Why not invest the money or at least stick it in a high-interest savings account and then use the yearly gains to rent somewhere to vacation during the year? Not only do you avoid the hassle and cost of upkeep for a second home, but you avoid the environmental and social problems that come with increased second home ownership.
posted by ssg at 12:02 PM on August 13, 2007

The obvious problem with Europe is that you have to get there. How much is a flight to Slovenia?
posted by smackfu at 12:02 PM on August 13, 2007

I'd suggest somewhere on either coast of Canada (Vancouver Island, Lower Mainland BC; Maritimes), but the coastal residents aren't always that impressed with people who are there one month a year and absentee landlords the other eleven. I'd invest the $100k and use the interest to give you at least a few summers to look in different places by staying there.
posted by holgate at 12:07 PM on August 13, 2007

The Baltic countries (Estonia, Latvia, Lithuania) have lots of lakes, are EU members without the euro, have cheaper property in rural areas (though their capitals are getting pricier by the day), aren't super-hot, and have increasingly good access to the rest of the world. No mountains, though. Finland and Sweden have a similar climate but are probably more expensive.

Closer to the US, (hard to have fun on your vacation when you spend a million dollars trying to get there), the area around Mont Tremblant in Quebec seems to have both skiing and lakes, but it might be hard to get to rural areas in the winter. It's (according to Google Maps - I've never been there!) 90 minutes from Montreal. No idea about cost.

Northern New Mexico seems nice as well, though you'd probably get less for your money than you would in eastern Europe or rural Quebec.
posted by mdonley at 12:10 PM on August 13, 2007

My gf and I bought a house in Languedoc a few years ago, and the prices are moving up there but slowly. One very lovely village we've become enamored of is Gruissan, where there is an excellent beach. Here is a page showing real estate listings for Gruissan.
posted by jet_silver at 12:39 PM on August 13, 2007

$100K won't buy you anything worth owning anywhere in Ontario. So if you're not looking there now, don't bother. An article on Toronto cottage country.
posted by GuyZero at 1:30 PM on August 13, 2007

i don't have a specific suggestion, but general advice.

buy somewhere you can get to easily, so you actually use it more than once a year. ideally, someplace within a half days drive, so you can easily hit it for a long weekend.
posted by domino at 2:49 PM on August 13, 2007

My uncle has a cabin on big bear lake in California. In the summer you can boat/jet ski. In the winter you can ski. I know he has rented his place out. I think $100k seems pretty low for that area I know his was almost 2 mil.
posted by DJWeezy at 6:49 PM on August 13, 2007

I found this place in Park City. It would be easy to rent and you'd have easy access to the Sundance Film Festival and the best skiing in the world.
posted by metacort at 11:49 PM on August 13, 2007