Sales continuing to grow
Demand for vacation home sales is heating up as a strong stock market, and improving economy and job market, have given more consumers the confidence to spend more freely on second residences, summer homes and getaway spots.
Real estate brokers in resort locales from the Mid-Atlantic to Lake Tahoe say second-home buying activity has picked up over the past year or so. Low interest rates and savory deals are a big draw, they say. And with lending and down-payment requirements still particularly tight for second single-family homes and condos, cash is still the preferred way to buy for many.
Nationwide, sales of homes intended for personal vacation use rose 10.1% in 2012 to 553,000 properties, according to the National Association of Realtors’ investment- and vacation-home buyers survey.
The spring survey reflects a rebound in all segments of the housing market, including the vacation-home sector, says Paul Bishop, the NAR’s vice president of research.
Why the strong lift in vacation-home sales? The economy is growing, the unemployment rate is generally ticking down (though initial jobless claims rose last week), and the stock market has done very well in the past year or so, Bishop notes.
“A lot of buyers, who were sitting on the sidelines, decided last year was probably a good time to take advantage of buying a vacation home,” he said. “They were feeling pretty good about their own financial situation, given the growth in the market and in the economy.”
Second-home buying activity has been brisk in New Jersey beach vacation spots such as Avalon and Stone Harbor, says real estate broker Allan Dechert, co-owner of Ferguson Dechert in Avalon.
Back At The Beach
The Avalon and Stone Harbor areas got hit by Superstorm Sandy, but nothing like up north in spots such as Long Beach Island, where a significant amount of inventory was lost, Dechert says.
“But we didn’t have that,” he said. “And we really didn’t see any fluctuation in pricing.”
Dechert says activity in his area, however, was a little slower the first month or so after the storm.
Interest in buying second homes has increased as people look to “get more bang for the buck” amid low interest rates, he says. He’s seeing a pickup in new construction in Avalon for resale and owner occupancy.
“We just finished up a great April with a lot of activity in all price segments, from $300,000 to $3.8 million, with most activity around $1 million,” he said. “The market has been very active even in higher-end properties … a very good sign.”
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article courtesy of Investers.com