As we fork over yet another deposit on a Vail rental condo after years of lugging gear up I-70, we begin to wonder if maybe we shouldn’t consider investing in something a little more permanent, like a second home in the mountains. After all, between gas, hotels, and food, we’re spending thousands every season. So when is it worth it to buy a dream home base in the hills? The answer, of course, depends on several factors, but if you have to pull out the calculator and massage the numbers to make it work with your budget, the answer is probably no.
If you do have some extra income lying around, you may be able to jump into the real estate market if (and only if) you’ve taken care of a few other things first. If you’ve met your retirement and kids’ education goals and still have a fat wad left over, then you can wade into the fresh powder of a second home purchase, says Mark Brown, managing partner at Denver’s Brown & Tedstrom Wealth Management. A second home becomes an even more viable option if you plan to retire in it, too, but only if the extra mortgage payment doesn’t put you in danger of overextending your finances now. Just be aware: In the most popular resort towns, you’re going to need about $300,000 just to get into a condo (see “Mile High Money” in our September issue.