7 Things To Know About Buying Real Estate on the Outer Banks

Here is a list of the top 7 items I discuss with any new buyer who is looking for their vacation or investment home on the Outer Banks.

  1. Be prepared for 20% or more down. Depending on your situation, the bank may require more (like when buying a condo) because it’s not your primary residence.
  2. You can use up to 75% of the rental income the home generates in order to help qualify you for the mortgage. You will need at least a three-year history.  Keep in mind, this will mean you have to apply for an Investor loan which does carry a slightly higher interest rate.
  3. The entire Outer Banks is in a flood zone. Some areas are in flood zone X which means no insurance is required.  Most of our area will qualify for the National Flood Insurance Program, which usually runs less than $800 a year.  (Assuming Congress passes the extension this year)
  4. If you buy a foreclosure, you’ll have to re-furnish the home and buy it as-is. For some reason, the banks just haven’t figured out that the furniture in these vacation homes is valuable and needs to stay.
  5. The local county and city taxes are very low here. We generate so much revenue from the weekly guests in Occupancy Tax and in Transfer Tax on the sale of a home, that the annual taxes can stay very reasonable.
  6. Property Management fees vary based on the services you select from the Manager. It’s sort of an a-la-carte situation these days.  How much you want the Property Manager to do for you will determine the percentage you’ll pay.
  7. The Median Sales Price for a home on the Outer Banks in June 2005 was $507,000. In December 2016, it was $315,000. NOW is a GREAT time to buy your vacation home!

For more information on how to get a home of your own on the Outer Banks, call today!