When you’re considering bringing a slice of the vacation life into your life permanently with the purchase of a vacation property, you need to make sure it makes financial sense.

It’s a tough decision and that’s why so many people debate about whether it is better to buy or rent a vacation home.

After the initial purchase of the property is made, you’ll need to remember the additional costs associated with owning the home. That includes, but is not limited to:

  • The mortgage
  • Taxes
  • Operating costs including heat and hydro
  • Insurance
  • Repairs and
  • Furnishings

Buying a property and renting it out when you’re not using it is one way many people offset these costs, but this idea comes with considerations too.

  • Is renting permitted? This may be again the rules if you’ve purchased a property that’s part of a homeowner’s association.
  • How often you want to use it yourself – if you want to use the cottage all summer and just rent it out in the spring and fall you may not recuperate enough of the costs to make it worthwhile.
  • Will the additional maintenance costs (think hiring a cleaner to come in after each guests leaves), insurance (you’ll need an additional policy to cover renters) and potential repair costs (not everyone will treat your property the same way you would) offset enough of those costs?

And remember that an additional property comes with additional work. From keeping two homes clean and operating, it can eat up a lot of the time that you may prefer to simply spend in vacation mode.

But of course, owning a property is normally a sound investment over the long-term.  Buying and holding real estate over a long-term period has always proven to be a profitable and personally rewarding investment strategy especially if you are able to enjoy the property during your period of ownership.

Rule-of-Thumb Formula – Buy versus Rent

The general rule of thumb to buy versus rent is determined based on your personal usage.  If you occupy the property for three months or more on a continual basis, then ownership make more financial sense.

Alternatively, you can rent a vacation property. While it won’t be an investment, it can offer the following benefits:


  • Freedom to visit different places
  • The ability to completely relax while away
  • A flat rate expenditure


  • The inability to pick up and visit whenever the mood strikes
  • You’ll have to pack everything you need while you’re away each time you go
  • Once spent, it’s money you’ll never recuperate

So as you can see, the decision as to whether it is better to buy or rent a vacation home is more than just about dollars and cents: it’s about how you can incorporate that vacation lifestyle into your everyday life.



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