Estate Planning Summer Series
So you Want to Own a Family Vacation Home
Summer is in full swing and we are about to embark on another trip to the beautiful state of Maine. Our last family trip to the region in 2014 was nothing short of amazing. As is usually the case when we visit a beautiful location, my wife and I end up discussing a vacation home purchase. Like many people, we envision a treasured family home where we can gather with our children, and someday their children. Because I do not think that my wife and I are alone in this vision, and that many of you have, or would like to have, a vacation property, I wanted to take this opportunity to discuss some important legal concerns involving vacation properties.
A vacation home is unlike any other property. Few assets can bring a family together like a vacation home. Whether it’s a beach house on the east end of Long Island, a ski house in Vermont, or a rustic cabin in Maine, a family vacation home can be the source to lifelong joyful memories. Most people envision the vacation property remaining in the family and being passed on from generation to generation for everyone to enjoy. Seems simple enough.
Unfortunately, if certain issues are not addressed upfront, that same vacation property which was meant to bring the family together, can be the source of conflict and not such great memories. If not addressed at the beginning, unique issues involving vacation homes can lead to disputes amongst children, legal bills, and even the loss of the property. Certainly nothing that was envisioned by you when purchasing that dream property. As an estate planning attorney, it is my goal to help families avoid or minimize such problems. So, let’s take a look at some considerations when owning a vacation property.
Considerations in Owning a Vacation Home
People often get caught up in the emotion of purchasing and owning a vacation home. That’s what makes owning a vacation home so much fun. If you are interested in owning a family vacation home, however, you can not overlook some realities:
* A vacation home is a valuable asset that must be protected;
* There are ongoing costs and potential liabilities which must be planned for;
* If there are multiple family members who own the property there will be issues over who can use the property when.
* In order to address those realities, and others, the family should ask themselves the following questions:
* What is the real purpose for buying the vacation home?
* Who is going to own the property?
* Is each owner going to have an equal share of the property?
* Who will be responsible for costs, maintenance and upkeep of the property?
* Is the vacation home going to be in the same state where you live or in a different state?
* Do you intend to rent the home?
* What if a co-owner can no longer afford the home or simply doesn’t want to own it any longer?
* Do you plan on selling the property after your death or have the property pass to your children?
* How can you make sure that those who inherit the vacation home are in the best position to enjoy the home as you intended?
These are just some of the questions which should be considered. If you already own a treasured vacation home, have you asked yourself any of those questions? Whether you are just starting out on this wonderful experience of owning a vacation home or have had one in the family for decades, remember, it is never to late to address such issues.
In the next segment, we will address the different ways in which the family vacation home can be owned.