On paper, a beachfront condo or home sounds like a dream investment. Yes, beachfront real estate comes at a higher price, but the return is often worth the cost. But just like with any other investment, there are risks and benefits to purchasing beachfront property.
The Benefits of Buying Beachfront Property
There are many benefits to purchasing beachfront property, and these benefits often cause investors to overlook the potential risks of this type of property.
High Market Value
One of the main – and most obvious benefits – to purchasing oceanfront property is the high market value it provides. Beachfront homes and condos are least affected by changing property market trends.
And you gain peace of mind in knowing that even if your property does lose some of its value, it will likely be the first type of property to start appreciating again.
Great Rental Area
Beachfront homes and condos have high market values, but they’re also easy to rent out. Renting out your beach home can provide you with a significant profit.
Tourists are happy to pay a higher price to stay in a beachfront home or condo. Many people use that as a trial to buying overseas property.
Purchasing a beachfront home will provide you with your own getaway. Trips are less expensive, as you already have a place to stay – the most expensive part of a vacation.
If you enjoy traveling during high season and holiday weekends, you’ll save a bundle on your vacations if you own a beachfront home.
The Risks of Buying Beachfront Property
While there are many benefits to purchasing a beachfront home, there are also some risks.
Storms and Weather Damage
One of the biggest concerns with purchasing oceanfront property is storm and weather damage. Hurricane Harvey had $125 billion in damages, and Hurricane Katrina had $161 billion in damages.
With that said, if you invest in a condo, you may not have to worry about roofing, landscaping and siding. And if your unit is on a higher level, flooding may also not be an issue.
If you plan to rent out your property, there is a concern that partying guests may cause damage to your property. Parties may also disturb neighbors, which can present legal issues.
Beachfront condos are prime targets for college students and groups of young people who may want to have a party during their stay. Noise issues and disturbances can lead to fines, and property damage will cost you more money.
In addition to damage from guests, you’ll also need to consider property damage due to the local environment.
Mold and mildew are major concerns among beachfront property owners. Humidity and moisture can cause mold and mildew to form in just a few days. Leaking pipes and roof leaks can lead to significant mold damage. The very nature of people coming and going from the beach and into the home can lead to mold or mildew growth.
Flooring damage is another concern, as sand can get worked into the carpet or scratch hardwood flooring. Tile and area rugs are the ideal solution, as tile can stand up to the damage of sand.
When considering beachfront property, it’s important to weigh these pros and cons carefully to determine whether it’s a sound investment.