In 2023, a record 28 million people visited Kansas City. As a result, there's no better time to invest in a vacation home there.
The great thing about these homes is that they tend to appreciate in value. If you rent it out, you can offset most of the costs associated with owning it. And if you love Kansas City, you'll be able to travel there at almost no cost!
Want to know more about why Kansas City is an ideal vacation home destination? Here are five clear reasons to invest in it!
1. Take Affordable Vacations
As far as popular Midwest travel destinations go, Kansas City is pretty high on the list. If you're interested in taking easy and affordable vacations, investing in a vacation home may save you a lot of money long-term.
The math here depends on how close your investment will be to your primary home. If it's a quick jaunt (within a 2-4 hour drive), there's a good chance you won't want to vacation anywhere else!
2. Diversify Your Income
A vacation home investment also gives you the option to diversify your income. If you rent it out, it can be a nice short-term revenue stream. This income could supplement your salary and interest-bearing income.
Optimizing this income may require working with a local agent. Some key considerations include:
- Predicting a property's income potential
- Calculating recurring costs and expenses
- Doing market research
3. Plan for Retirement
Even if your retirement is many years off, it never hurts to plan early. Do you want to host your grandkids for the holidays? Do you want to retire by the lake, at the beach, or near one of the many Kansas City attractions?
Moving closer to retirement will also keep lowering the amount you owe on the vacation home mortgage. If you hire a property manager to look after things, your second home will wait for you for as long as it takes.
4. Build Wealth and Equity
Buying a second home comes with many property ownership benefits. You don't have to pay cash for it, either. Most people who buy these homes will invest in it through some financing option.
Once you own a vacation home, hosting short-term rental guests will allow you to offset all costs, including:
- Mortgage
- Property taxes
- Maintenance costs
- HOA fees
5. Get Tax Advantages
With Kansas City real estate, tax deductions depend on usage. If you rent out a vacation home for less than 15 days a year, it's not treated as a rental property. In some circumstances, this can lead to major tax benefits.
If you rent out your home for more than 15 days, you must include the rent in your income. That said, you can deduct some operating expenses. If your expenses exceed your income, you may be able to claim a rental loss.
Managing a Vacation Home
If you're planning to rent out your Kansas City vacation home often, you'll need the right property manager. Oftentimes, this will be the key difference between a good investment and a bad one.
At PMI Destination Properties, we offer a full suite of management services. We'll preserve your investment while maximizing its profitability! Contact us here to see why we made Entrepreneur's list of the 500 best franchises in 2024!
