The Difference Between Renting a Cottage and Mortgaging a Cottage

Written by: Arron J. Staff writer @ Hyggehous.com

Photo Gallery

The dream of having a cottage to retreat to is a dream that many people have.

It seems like the ideal life to have a cottage on the lake and enjoy relaxing vacations in the summertime with family and friends. But do you go ahead and get a mortgage on a cottage or just rent one out each time you want to have a relaxing vacation? One of the things that people should consider before buying a second property is how much they'll be using it and if they'll easily be able to rent it out or sell it if the time comes. Shop Tiny Homes The expenses of having a mortgage on a second property are just like having a mortgage on your primary residence. The mortgage rates are pretty much the same, and also you have the same type of property taxes and utilities to pay. Plus, you have home insurance to pay and all of the repairs that come with owning a home. So you have to research and look into how much it will really cost you to own that second property. So you won't be paying just one mortgage, but two mortgages, probably for a good portion of your life.

As mentioned before, one good way to know if you should get a mortgage on a cottage or just simply rent is to assess how much you will actually use it.

Sit down with your family and look at your summer calendar factoring in everything you usually enjoy doing during the summer. You will quickly start to see how much spare time you have to go to your dream cabin. Although if you and your family start to talk about how nice it would be to not spend the summer in cars or planes travelling around to different locations, then maybe a cottage is a good idea for you. This way you only have to pack up once at the start of the summer and then at the end when you return home. It becomes your second home so you will always have somewhere familiar to go and create lasting memories together. On the other hand, many people just enjoy staying at home in their own town or city all summer to spend time with friends that live nearby. That's always really fun too, so it all depends on your life and the way you'd like to design it. Just consider what feels best to you and what realistically makes the most sense before getting carried away by a fantasy that may end up costing you a lot of money.

Another way to make a cottage make sense in your life is to rent it out when you're not using it.

This will make the cottage way easier to afford since you'll have help on paying the mortgage. There are companies that rent out other people's cottages for them taking care of everything from the cleaning to handing off the keys and doing repairs. Of course, they take a cut of what you're making, but you'll still be making some money, and your cabin won't be sitting there going unused. You can also rent out your cottage on Airbnb and then hire cleaners or go out there yourself to clean and hand off keys. The location of your cabin will also play a big role in figuring out how much it will actually get rented out. A cottage in a popular tourist area will be likely to be booked up constantly, whereas something in a more remote area will be harder to book. So with these considerations, you can get a better idea of whether you'd like to have a mortgage on a second home or stick to renting out other people's cottages for vacation time.