Owning a lake house/condo?

[warrior999]

We are looking at a condo on Lake Hamilton in Hot Springs, AR. Any advice out there. 3.5 hr drive. Just over 4 pulling boat but in the summer, we have a covered dock.

 

[Lay Lake]

I'm not in Arkansas, but if it fits in your budget to buy then I would. We have a second home on Lay lake (in Alabama) and being able to pull into the dock (covered lift) is worth a lot. Plus I'm to lazy to have to tow and launch and reload every time I want to use the boat.

 

[sjhorner9475]

I cannot give you any advice about a condo on Lake Hamilton, but can give you some general advice about owning a lake condo. We purchased a condo on Center Hill Lake in Tennessee four years ago. Out condo is only and hour and fifteen minutes from our home so it is an easy drive for us. The first question I suggest you ask yourself is how often will make the 3.5 hour drive to the lake? You want to make sure you will use it enough to make the purchase worth the investment. Other things to consider:

• Do you plan to rent it out? If so, does the condo association allow it? Our condo association allows you to rent your unit but you must provide the association with the name and contact information of every renter and you are responsible for any issues related to the renter not following condo rules. For example at our condo if the renter were to unhook the boat/trailer from the vehicle and leave it sitting in the parking lot, as the owner you will pay a fine since this is not allowed. You want to know all the rules of the condo association before you purchase, especially those tied to renting out the unit if you decide to do that.
• Also if you plan to rent it out, consider having one or more closets and cabinets that you can lock allowing you to keep food, clothes, and other items at the condo that you do not want renters to have access to.
• I would recommend hiring a home inspector to inspect the condo as part of the purchase process just like you would when buying a house.
  
• How much are the condo association fees and what is the current financial status of the association. Has the association put enough funds in reserve to cover the cost of future maintenance and replacement items such as the roof. When we were in the process of buying ours we learned the association's reserves were underfunded and there was consideration of instituting a multi-thousand dollar assessment on all owners. As a result we negotiated with the seller to reduce the price several thousand dollars to cover this since the under funding occurred while they owned the condo.
• Make sure you know what the association's insurance covers and what it doesn't so that you have adequate insurance coverage. For example if our condo building building burned to the ground, the association's insurance would pay to rebuild the building exactly as it was when originally built. If you had done any improvements, such as replace Formica counter tops with granite, the association's insurance will only pay the cost of installing Formica countertops. Your insurance would have to cover the additional cost to install granite.
• Is the condo furnished and if so, will you keep the furnishings or replace them? Furnishing a condo can quickly add up to big dollars.
• I would highly recommend that you change the locks after buying a condo. Several weeks after taking possession of our condo we learned that in addition to the three keys to the unit the previous owner gave us, he had also given out over a half-a-dozen keys to others. We never had an issue but to be safe we felt we needed to change the lock. When you change the lock you need to check with the condo association on which locksmith to use because most condo associations have a maintenance man that needs to have a master key to enter any unit in the case of an emergency.
• We keep a small spiral notebook that we use to log anything we need to take to the condo such as grocery items, laundry supplies, and other items. This helps us to make sure we do not forget anything because the closest store is about 30 minutes away.
• Consider keeping some clothes and personal care items at the condo so you don't have to pack clothes and transport them back and forth each time you go to the lake.
• We purchased our condo furnished which allowed us to use it immediately. However over the coarse of our four year ownership we just about replaced all the furniture and we have stocked the kitchen with pans, plates, etc. comparable to our home but that is because we want it to be as comfortable as our home and we do not rent ours out.

I hope you find this information helpful. Good luck on your purchase.

 

[Lay Lake]

sjhorner9475 had excellent advice. How often will you make a 3.5 hour drive would be a huge decision. Our place is a 1 hour 20 minute drive. We make the trip often. Not sure I would want to drive much further than we do though.

If you plan to rent, excellent advice was given above. As someone who has rental property on the beach and manages it myself, dealing with renters can be exhausting at times. However, a typical rental management company will charge around 25% to manage it for you. Also, every time we go yo our rental property I work fixing things the whole time. Having our second home still requires maintenance, but most of it is not as urgent as rental property requires.

 

[warrior999]

Super advice sj, thank you. One of the things that draws us to the condo we are looking at is the rental policy. Minimum 3 month which I love. We did not want to rent nor have to worry about different neighbors each trip. The drive will not bother us at all. Plus, we have two daughters in their 20’s that asked for their own keys. And changing the locks is a great idea that I didn’t remotely think of. Wait, what? They actually asked last year when we started entertaining the idea of a vacation property. I will definitely check out the association’s financial stability. It is unfurnished but over the years, I can probably fill it up with everything besides beds.