Selling A Vacation Home? What You Need To Know About Selling a Second Home
Selling a second home is different from selling a primary residence. Prepping the home for sale and navigating the complexities of capital gains tax can leave some sellers feeling stumped. Knowing what to expect can help you through the process.
The tax implications of selling a vacation home can be significant. The law allows a person to sell a primary residence tax-free if the sale is below a certain threshold, however, this is not the case for the sale of a second home. People who sell their second home must pay 20 percent in federal taxes and an additional cost for their state taxes. Residents who live in their vacation home as a primary residence for at least two years may be able to take advantage of certain tax benefits. Your accountant or lawyer can help with this process.
Prepare The House For Sale
To make the property more appealing to buyers, perform basic maintenance around the home. To do this, replace broken windows and door knobs, caulk the windows and deep clean the property. It's also important to make the inside of the property look cheerful and inviting. One of the best ways to do this is to allow natural light into every room. Prune back shrubs and trees that block windows and make rooms look darker. Leave all blinds and curtains open, and if necessary, replace blackout drapes with lighter cotton drapes.
Maintain Comfortable Temperature
Unless you are currently living in your vacation home, you've probably turned down or off the climate control. Now is not the time to save money on your HVAC system. It's important to ensure that buyers feel comfortable when they enter the home, so have the HVAC system turned to a pleasant temperature. If your thermostat is new, you can probably do this remotely. If the thermostat is older, consider installing a smart thermostat that you can control from your primary residence. This will help you save money on heating and cooling and can also impress buyers.
Many people winterize their vacation home before they leave for the season. This can involve shutting down the hot water, emptying the pipes and pouring antifreeze into open drains, all of which renders your home's plumbing system useless until you return. However, winterizing can be a problem when buyers come to see your house and test its functions. Avoid winterizing to ensure that buyers will be able to test the plumbing when they come to your home. As long as you're keeping the temperature in your home at 50 degrees or more, you should not have to worry about the pipes freezing.
High maintenance landscaping does not win points among vacation home buyers. Native landscaping is best because it's easy to maintain. This type of landscaping also helps reinforce the setting of your vacation property, whether you're on a beach or in a mountain.
To upgrade the landscaping around your home, go to a nursery near your vacation property and ask to see ornamental native vegetation. Look for plants that are unlikely to need any supplemental watering from you in order to thrive.
Consider Hiring Help
If you live far from your Green Valley vacation home and are not able to stop in every time it gets seen by a buyer, consider hiring someone to help you maintain the property during the sale process. Have this person come by the house before showings to perform small maintenance tasks like landscaping clean up and dusting. This helps ensure that your home will look its best for potential buyers.
Work With Your Real Estate Agent
Your real estate agent can help you work on strategies to make your property more appealing to home buyers. An experienced agent can also help answer questions about the sale of a second residence. To get started listing your home, contact a real estate agent in the area around your vacation home today.