With the economy on the upswing, better interest rates, and stock market gains, vacation homes and second home purchases are booming. By the lake, in the mountains, near the cost, in the desert — there are tons of great locations with plenty of fantastic properties. And sometimes a second home can actually make you money.
Do you occasionally rent out your vacation home? Services such as VRBO, HomeAway, and Airbnb are increasing in popularity, sometimes becoming a reliable second income stream for homeowners. Oftentimes the cost of maintaining these income-producing properties can be deducted. However, pitfalls abound. This report from the latest issue of Tierra Grande, the quarterly magazine produced by the Real Estate Center at Texas A&M University, spells out the particulars of how vacation homeownership can lead to a tricky situation without proper record keeping.