Homeownership is a big step, and when you have secured your first home, and are looking to build further equity, the notion of purchasing a second home may seem like the next reasonable step.
While this may seem the case, there are some crucial variables to take into consideration before embarking on this kind of undertaking. All things considered, you will be taking on an equal amount of responsibility in tandem with the initial property you already are managing.
Expenses stack, so make sure all of your finances are secure because, in the event of a worst-case scenario, such as bills, repairs or other expenses, you will be paying essentially double between the two properties you are pursuing.
Additionally, consider your wider expenses as a whole. Are you feeling financially stable? Do you have emergency funds available? If this isn’t the case, while a second home may seem appealing, it would be best to further allocate your income and boost your earnings so that all of these variables are secure. These variables include your debt as well.
Is all of your debt secure? If not, it would be best to start making moves toward alleviating your total debt. This can be any additional loans you have, credit card debt or even student loans.
Above all else, is your primary home paid off? Even if you are close to having your final payments established, if you haven’t secured your final home payments down to the last cent, a second home could be daunting and a secondary stressor — as anything can happen between your final payments on your first home and the first payments of your next one.