Vacation Home Property Sales Surge from ‘Keeping Current Matters’
The American desire to own a second home as a vacation home is alive and well!
The National Association of Realtors analysis of U.S. Census Bureau data shows there are approximately 8 million vacation homes in the U.S. Their 2014 Investment and Vacation Home Buyers Survey shows vacation home sales improved substantially in 2013.
NAR Chief Economist Lawrence Yun said favorable conditions are driving second-home sales:
“Growth in the equity markets has greatly benefited high net-worth households, thereby providing the wherewithal and confidence to purchase recreational property,” he said. “However, vacation-home sales are still about one-third below the peak activity seen in 2006.”
Here are the key findings from the report:
Raw Numbers
Vacation-Home sales rose 29.7 percent to 717,000 from 553,000 in 2012
Sales accounted for 13% of all transactions last year, up from 11% in 2012
The median price was $168,700, compared with $150,000 in 2012, reflecting a greater number of more expensive recreational property sales in 2013
42% of vacation homes purchased in 2013 were distressed homes (in foreclosure or short sale)
Buyer Profile
The typical vacation-home buyer was 43 years old
The median household income was $85,600
Buyers plan to own their recreational property for a median of 6 years
33% said they were likely to purchase another vacation home within two years
82% of all second-home buyers said it was a good time to buy (compared with 67% of primary residence buyers)
Reasons for Purchasing
Lifestyle factors remain the primary motivation for vacation-home buyers:
87% want to use the property for vacations or as a family retreat
31% plan to use it as a primary residence in the future
28% wanted to diversify their investments or saw a good investment opportunity
23% plan to rent to others
Location
41% of vacation homes purchased last year were in the South
28% in the West
18% in the Northeast
14% in the Midwest
The vacation homebuyer purchased a property that was a median distance of 180 miles from their primary residence (down from 435 in 2012)
46% were within 100 miles
34% were more than 500 miles
Financing
38% of vacation-home buyers paid cash in 2013
The median down payment was 30%, up from 27% in 2012
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