However, prices of second homes are also on the rise
Increased financial wealth and low mortgage rates have led to a growing demand for vacation homes, according to the National Association of Realtors.
But prices are up, too. From 2013 to 2018, vacation-home counties posted a 36% increase in median sales price. This uptick is higher than the 31% price growth rate of all existing and new homes sold, according to the NAR US Vacation Home Counties Report.
Nantucket, Mass., topped the list of expensive vacation-home counties in 2018, with a median sales price of $1 million. Other counties with high price gains during the five-year period included Pike and Monroe, Pa., as well as Price and Washburn, Wis.
“As of 2018, household net worth reached an all-time high of $100.3 trillion – that’s nearly double from a decade ago when wealth declined during the recession,” said NAR Chief Economist Lawrence Yun. “Some of this tremendous growth in wealth, although concentrated, increased demand for vacation homes.”
NAR also found that most of the borrowers who took out mortgages for vacation homes earned an annual income of around $100,000 or more.
While most vacation-home buyers said they wanted to use the property as a primary home, some intended to use it as a general family vacation spot, as a tenant rental, a means to gain equity, or – upon retirement – a future primary residence.
