By Meredith Dunn, Research Communications Manager, National Association of REALTORS®
The 2017 Investment and Vacation Home Buyer’s Survey from the National Association of REALTORS® (NAR) illustrates that while 2016 was a strong year for primary home purchases, the share of vacation homebuyers slid for a third year to 12 percent. Tight inventories and growing home prices made finding a vacation home less affordable last year. However, those that did purchase a vacation home were optimistic: 81 percent thought that 2016 was a good time to buy.
Who did buy a vacation home? Data shows that the typical vacation homebuyer had a median income of $89,900 and bought a home of 1,460 square feet. Many vacation homebuyers wanted beach getaways: the median distance between the primary residence and the vacation home was 200 miles, and 36 percent bought in a beach location, which was the most popular location last year (followed by lake front properties at 21 percent). Many homebuyers also wanted their holiday spot to be some place warm, with 43 percent heading to the Southern states to make their vacation purchase.
The median price for a vacation home last year was $200,000. Over half (56 percent) of vacation buyers bought a detached single-family home, but condos at 22 percent and townhomes/row homes at 21 percent were also popular choices. Thirty-eight percent purchased a distressed sale, and most (72 percent) used a mortgage to finance their home purchase.
While the largest share of vacation buyers, 42 percent, bought their vacation home to use for vacations or as a personal retreat for friends and family, 18 percent bought for future retirement plans.
Investment buyers were more likely to rent out the purchased property, but some vacation homebuyers had the same idea: 29 percent did or tried to rent their property in 2016 and plan to rent their property in 2017. Finally, the optimism about now being a good time to buy carries over into future buying plans: 54 percent of vacation homebuyers consider themselves at least somewhat likely to buy an investment property in the next two years, while 50 percent consider themselves at least somewhat likely to buy another vacation home in the next two years.
For more information, please read the 2017 NAR Investment and Vacation Home Buyer’s Survey. It is also available for download.
Nancy M. Alexander - Stone Harbor and Avalon NJ Real Estate NancyAlexander.com
