If you are thinking about buying or building a cabin as an investment, you may want consider these tips. Looking at a cabin as an investment is different from looking at one for personal use only. Even if you are looking at buying or building a cabin or log home, you may still want to consider these.
Are cabins or log homes good investments in general?
Cabins like other forms of real estate are generally excellent investments. A cabin in a good location can bring in a good return as a vacation rental and typically will grow in value. On the other hand cabins unlike other real estate require more maintenance and if you don’t do this maintenance it can result in rot and loss of your investment.
How to tell if a cabin is a good investment.
Before you purchase or build a cabin as an investment you may want to consider these points:
The cabin is in a sought after location.
Location, location, location! Perhaps the most important factor when considering buying or building a cabin is the location. The more well known a location is (like the Adirondacks) the easier it will be to rent it out and sell it when it is time. Locations that are popular will most likely cost more, but will have more people searching for and visiting that area. A good location that is sought after will offer competition on pricing for both resale and rentals. A cabin in a less popular area will cost more to market for both and have less eyes on it. Think of it as benefiting from a brand like the Adirondacks as apposed to building your own brand. The location can also expand your booking season. For example being on a lake in the summer or near snowmobile trails in the winter.
The cabin has amenities that make it stand out.
Amenities will help your cabin stand above other cabins in the area for both rental and resale. Waterfront properties tend to have better returns. Cabins with electric or a usable bathroom also fetch more. Privacy should also be considered an amenity. A good idea is to make a list of all amenities for each cabin and compare them to others in the area. This can also be a good negotiation tactic for getting a better price.
The cabin was taken care of.
As mentioned above cabins require special maintenance. A cabin or log home will need to be stained every few years and the chinking will need to be maintained as well. Skipping regular maintenance can really wreck a cabin. Be sure to check the logs for rot, mold, chinking that is failing, and for water marks. Water stains typically will be signs of a bigger problem. Once you do build a cabin or buy one, you’ll want to set a schedule for maintenance. Inspect it often and be sure to stay ahead of problems that might arise. This will protect your investment.
You will enjoy the cabin.
The best investment is one that you can enjoy as well. The best part about a cabin as an investment property is that you get to use it. It is important to remember that when you want to use the cabin may also be when you can make your best money. Be sure to plan your stays strategically and make sure that you are not eating up your profits.
Bonus tip: You can add value.
A good way to get a better deal is having the ability to add value to the property. This could be as simple as plugging an AC unit in or hooking up electricity and plumbing. It may even be building a cabin on a plot of land. Having the ability to add value is a great way to get more for you money and increase your rental value.
Which do you prefer building or buying a cabin?