Hidden Costs of Buying Beachfront Property

Life on the beach is in fact far more expensive and tough than the glossy real estate brochures would have us believe. Other than the mortgage, there are the silent costs which are not reflected until you have the keys. You must not just look at the view and buy the lifestyle by the water, unless you are serious about the hidden costs associated with it.

Coastal Property Maintenance and Salt Damage

The biggest shock for new buyers? The environment is hostile. That new sea air you are fond of is full of salt. And salt is an implacable house-destroyer. 

Inland, repainting your house would typically be necessary only every 15 years. But on the coast, you will probably be required to do it every 5 to 7 years, as the salt spray eats through paint and renders fast. 

It doesn’t stop at the walls. Salt air penetrates everywhere:

• Electronics: Your TV, laptop and above all your air conditioning unit will die earlier. The internal parts are easily corroded by salt. 
• Metal Fittings: Stainless steel is not necessarily stain-less around the beach. Door handles, railings on the balcony, and the fittings of the lights will rust in a few months unless you keep cleaning them.
• Concrete: Salt may even penetrate reinforced concrete and rust away the steel within it, leading to cracking and flaking off of the concrete (a distasteful phenomenon known as spalling).

Fixing salt damage is not an easy task, and when you search for property maintenance near me, be aware that local tradies usually charge a premium since it is a messy task to fix. 

Rising Insurance Costs for Beach Houses

You are likely to find the insurance a bit more expensive closer to the water. 

In most coastal regions, particularly sections of Queensland and Northern NSW, there has been an increase in premiums due to cyclones, storm surges and flooding. Statistics indicate that houses in the high risk areas along the coast lines may be 20–30 percent more expensive to insure than those in the inland areas. 

The maps that are used by insurers are very specific. In case your dream house falls in an erosion or storm tidal red zone, you may discover that:

• There is no such thing as flood cover.
• The excess (when you claim) is so excessive that it is hardly worth having.

Do not trust an online estimate. Get a specific quote for that exact address and then sign a contract.

Strata Fees and Council Rates Explained

When you purchase a single house, you will pay for your own repairs. However, an apartment is the entry point of many first-time buyers. This takes you to the world of Body Corporate fees.

The fees in the more popular areas such as the Gold Coast or the Sunshine Coast may easily reach between 2,000 and above 10,000 annually. 

Why so much?

• Upkeep: It is costly to fight rust on a high rise building.
• Facilities: You are paying to have lifts, pools, gyms and gardens.

On top of that, your local council rates are normally pegged on land value. The coastal land is among the most expensive land in the country, so you will have a significantly higher rates bill than it would be for a similar house in the suburbs.

Legal Considerations for Waterfront Real Estate

Purchasing along the coast entails legal inspections which you simply do not require in the suburbs.

For example, when your property has a jetty, a pontoon, or a sea wall, then you may not own the land upon which they are located. They are frequently located on Crown Land (government land), and in this case, you will have to pay an annual lease.

Worse still, when a sea wall collapses, then you may be the one responsible to repair it- and that can cost thousands of dollars per meter. 

That is why you have to get the right team. Hiring local professionals such as conveyancing solicitors Sunshine Coast will make sure that you have a specialist who knows what to look for. They will inform you whether that access to the private beach is a public access, or whether you will not be able to renovate in the future due to erosion areas.

Realities of Holiday Rental Income

Most customers explain the expensive price by convincing themselves to rent it out as a holiday house when they do not need it.

It is like one of those clever property wealth building strategies you know. The asset pays for itself?

Not always. The rental revenue of beach towns is extremely seasonal. You may get enough rentals during December and January, but then go through weeks without any income in the winter. In the meantime, your bills (mortgage, internet, rates) are maintained at the same level.

In addition, when you employ a management agency to do your holiday letting, they charge more commissions of 15-20 percent plus cleaning charges than the normal 7-8 percent of a permanent tenant. You must calculate your figures on a worst-case scenario, not on the peak of the holiday season. 

Is Buying a Beach House Worth the Investment?

That does not imply that you should not purchase that beach house. Absolutely not.

While the lifestyle, health benefits, and relaxation afforded by ocean living are priceless, you must approach the purchase with full awareness of the potential drawbacks to truly appreciate it.

The consumers who fall into the trap are those who use the last cent on purchase price leaving no buffer to pay the bill of $15,000 when the balcony railings rust out after two years.

Do research, combat the salt, and look at the flood maps. When the figures stack up, then set your sights on it.