Vacation Property?

My stepfather and mom own a cottage in a very touristy part of Ontario. My wife and I really enjoy sitting beside the lake, having some drinks and trying to get the perfect amount of sun without waking up in burning pain the next morning.

This week, my mom took it upon herself to locate a vacation property she thought would be perfect. It was a nice small cottage with a perfect outdoor shower with really nice wood panelling and a crazy rainbow carpet, all on a lot which wouldn’t be legal in most municipalities. The whole glorious thing cost $170,000 – which was on the low end in the area (even with the amazing carpet).

I’m not sure what situation my wife and I could really justify buying a vacation property. In the past few years, we’ve averaged a total of 3 weekends to ourselves over the summer. We spend our weekends driving all over, visiting friends and family. During the cold Canadian winter, we tend to hibernate on our living room couch with Netflix and try to get all of our driving in while the weather is nice and we can sit outside.

We don’t have $170,000 in cash sitting around, so would have to finance a good portion of this property. We would also have to pay taxes, maintenance and utilities on a second property. I don’t even want to pay these monthly expenses on one property, the second one would make me really grumpy every time I was paying bills and not enjoying my vacation property (which is probably 46 to 50 weeks of the year).

While I appreciate people who own cottages, they just seem like they cost a lot of money, something that is tied up for now paying off my mortgage. My wife and I decided that much like our condominium, we would rather have other people look after our vacation property. If we are ever able to find a free weekend over the summer that we aren’t visiting someone or sleeping off the weekend before, renting a vacation place is probably a better idea.

For around $1,000, we can rent a place for a week to relax, read, get some sun and eat a bunch of barbecued food every night. We also wouldn’t have to worry about maintaining a house that we only stay at for only a couple of weekends per year.

Do you have a vacation property? How did you decide whether to buy it or not? How often do you use it?

I’m really interested in this particular crowd’s information as it is a fairly large financial decision that lots of people seem to make.

13 thoughts on “Vacation Property?”

  1. When I was 2 or 3 my parents had the money to buy a cottage. They decided to rent one for 2 weeks to see if it was the right thing. Somewhere towards the end of the first week my mom decided she didn’t want 2 kitchens to clean and my dad didn’t want 2 lawns to cut and the driving was inconvenient.

    A month later they put in an inground pool. My parents used it more than anyone. My dad cycled to work and he would come home and jump in to get cooled off after a hot day at the factory. My mom had lots of pot luck pool parties and because it was in town all the guests went home and she didn’t have to look at them over her morning coffee.

  2. Similar to the comment above, my parents wanted a cottage when I was younger. What they did instead was purchase a house in a different suburb that was a lake-front (back?) property. Rather than having to drive two hours away for the cottage life we had that in our backyard. Plus, we got to enjoy it in the winter for skating where you wouldn’t if the purchased cottage wasn’t all-season.

    Personally I don’t have any interest in owning a cottage, nor do I have the expendable income to justify it. To really make it worth your while you have to spend pretty much every weekend there during the good weather. I want more variety than that, and the option to go somewhere more exciting once and awhile.

  3. I don’t want a cottage, to expensive and too much work. That said I am currently wrestling with the temptation to buy a nice piece of land just outside the city on a lake. The idea would be I could camp there in the summer and then when I’m ready to retire I’ll build my dream home there (I nice little year round cottage) and sell my house in the city. I can afford it . . . it just wouldn’t be all that smart.

  4. We’ve owned our cottage for about 10 years now. I’m 41 years old.

    My criteria for purchase was that it had to cost proportional to the amount of use vs our house (twice a month max as we travel quite a bit), had to be paid for in under 10 years without having to rent it out and no more than a 3 1/2 hr drive.

    Got a great “deal” as the last owners’ new house was nearing completion and they needed the money. It cost $83000 back then, down from $124K listing price.

    It’s not at all fancy, a true cottage (700 sq ft) but we do have running water, gas heat, garage, 2 bedrooms, 3 piece bathroom, window air conditioner, last one on the street with no neighbours behind or on the one side and is within a minute’s walk to Georgian Bay.

    You just need to know yourself. It never was meant to be all of our life. And it is just our place. An opportunity to live differently. We don’t host people there at all.

    A key thing is we Love the freedom and flexibility to going when we feel like it, or not going if the 401 is jammed up/close due to an accident or when the weather is crappy. We don’t feel guilty if we don’t go.

    There are working accounts built up to pay for the next appliance that kicks the dust and for big stuff, like the septic system. It is another house to care for.

    If you find the right terrain (ie forest vs grass), you don’t have to do the level of outside maintenance you might have at your regular residence. Winters up there are gorgeous. So quiet and peaceful.

    We shut off all power when we’re not there. Annual property taxes are in the $970 range. At the right price point, this can be done. I wouldn’t pay what my cottage would sell for now because the ratio of use vs cost wouldn’t work anymore.

  5. We purchased our vacation property May 2012, it is located in southwestern Alberta – roughly 2 hours from our primary residence.

    We purchased this property with the intention of retiring there (currently on a freedom fifty plan – ten years away). Our property is just under three acres, has a cabin style house, a second building that we hope will someday become a studio. We have year round access, are steps away from the best fly fishing in the world, have amazing skiing in the winter, and have missed only three weekends in the past 15 months.

    Our monthly costs break out as follows: mortgage 1520, insurance 80, property tax 180, utilities 250, Internet 50 (under debate). We also spend about 400 per month on gas driving there every weekend and this was factored in at time of purchase.

    Our “yard” maintenance is basically what we decide it to be. Meaning if we feel like mowing, we mow. And in reality we really only have three months out of the year that it is required. Snow removal was minimal this past winter, fingers crossed for this year.

    We are slowly building an account for other maintenance for the cabin, as it is 20 plus years old and things will slowly need to be replaced. We are not fancy people, we don’t need granite and hardwood, what we currently have isn’t broken and we won’t fix it til it is.

    As of this moment we have not had one regret. We look forward all week to our “other life” away from the city, traffic, people, and just the everyday stress that living in a city brings. We have four children, three of which are adult and the joy we feel when we are all together at the cabin is priceless’ or 25,000 per year :).

    Our cabin the the mountains was our life dream, it took 18 years to fulfill that dream.

    We know where we will retire, we are able to get a taste of what that will feel like, and we know where we will die (hopefully).

  6. Not a lot of people know (at least from Southern Ontario), that you can camp FOR FREE on crown land for 21 days per year.

    We do this every year by going North (you could also go East). Pick a lake, get to it, dump a canoe in it and then paddle across a lake and make a camp site.

    We’re getting older so now we pack extra for comfort like padding under sleeping bags.

    Use canoes can run you about $200-$500 and you can transport them on a small car. Plenty of lakes in the North to choose from. I have stayed out of Algonquin park as well primarily because when I go to crown land I need no reservations. I’ve never managed to settle on any one lake, preferring to explore. You would be surprised by how easy this is to do. Seriously, open google maps and start looking around. The vast majority of lakes off the path just a little will provide you with solitude and lake front access FOR FREE. Why would I buy?

  7. When I lived in Ontario as a child the family cottaged every year, wonderful memories!!
    Dad always rented.

    Now hubby and I live in a fairly large city in BC (Kamloops) with a small house that backs onto parkland with a little duck pond that we can see from our deck. We stick around in the summer, could not think of a better place to be…and when we want to go to a lake it is a 15 min drive from our house, in any direction, and we can hang there all day and then go home to a clean house and a bug free meal!

    Winter is a different matter. We have considered a condo in Mexico but when we really think hard about it we say NO WAY….that money buys a stinkload (I am sure this is a word :)) of holidays in a variety of locations and no hassles…no one to watch the property, no taxes on said property, none of the worries of buying in a foreign country. Planning to rent a condo this December in our favourite hot spot and once we retire we have a list of places to see!

  8. We made the freedom 55 break from working a year ago, bought a popup tent trailer and spent 26 of the first 52 weeks of retirement on the road (not all camping). Rather than spending all our time at the same vacation property and spending our time maintaining it, we prefer exploring new places every trip – 14 trips in 14 months, so far.

    May/June and Sept/Oct are great times to camp south of the border – the weather is decent, the bugs are at a minimum, and since school is in, campgrounds are not too crowded. Campsites are cheaper than Ontario Provincial Parks, often with midweek specials!

    November is considered the offseason in the Florida Panhandle, with temperatures in the 70’s. It was an easy 3 day drive from Toronto. We were able to rent a decent 1 bedroom condo right on the beach of the Gulf of Mexico for a $1000 for the month! Being able to cook our own meals costs less than cooking at home. Have already rebooked again for this year, with so much still to do there.

    Total cost for the first year of travel was $15,000 (biggest expense was a house rental in the Florida Keys for the month of March – $3,000; will probably go elsewhere next winter). This did not include food (part of our monthly home budget anyway) or gas (which is cheaper in the US, but have kept up my monthly work commute funds as part of my pension budget). The travel budget is from the funds saved when we paid off the mortgage 8 years ago and continued to invest that amount each month rather than spending it. When CPP kicks in at 60 and OAS at 65, we will dump those back into the vacation investments.

    Our plan seems to be working well so far.

  9. Good topic!

    My parents have owned a cottage since I was in university and while the idea of getting my own has occurred to me…it just isn’t worth the cost for the amount of time I would use it. But I would say if you added up the time the entire family uses the property it likely makes sense. So I would be ok sharing a family property, but never owning a cottage by myself.


  10. Similar to an RV or a boat it is usually better to rent a vacation property than it is to buy one… With the following exceptions… Investment property or Long term plan of retiring to that property. In MW’s example above, turning 83k into 124k in 10 years may or may not be the best investment when you calculate 10 years of property tax and insurance as well as any applicable real-estate fees and closing costs when buying/selling the property. Now on the other end you take into considerations how much time you and/or friends/family spend there and if you are able to rent it from time to time. Then of course there is the friend/co-worker that you allow to stay there in exchange for the use of their condo in Florida/Mexico/Hawaii.. There is certainly some value in that 🙂

  11. I’ve always thought that having a vacation property is something parents could pass down to their kids because they could afford it before. However these days, it might only get used 2 months AT BEST out of the year, so the rest of the time you’re paying the carrying costs for nothing.

    I’d rather rent than own one.

  12. I want to own a vacation cottage but due to the high cost of maintaining it I prefer not to buy one. Instead, I can invest that money in stocks where I don’t have to pay monthly maintenance charges. Cottages can only really be using during the summer but I would still have to pay for it and maintain it the rest of the year.

  13. I inherited a cottage that has been in the family for many years. It is expensive (taxes $1300/year, hydro $50/month during summer) — mainly due to maintenance and repairs. However, it brings me great joy and I am there every chance I get from May through October and then a couple of day trips in the winter. I could never have afforded the purchase price, but this family cottage (and everyone uses it) enriches my life far beyond the cost.

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