Vacation homes are a growing source of real estate activity. Vacation home sales rose by 10 percent in 2012, while the number of homes sold to investors fell. That's according to the National Association of Realtors' 2013 Investment and Vacation Home Buyers Review published in April of 2013. The publication tracks trends for both new and existing homes that enter the vacation and investors' markets.
A strong stock market recovery combined with attractive prices on vacation properties and low mortgage interest rates to drive recovery in the recreational home sector. Meanwhile, properties bought on speculation or for investment fell 2.1 percent. At the same time, the share of sales related to investors fell 3 percent from 27 percent in 2011 to 24 percent in 2012. Vacation housing--nationwide--is the place to be in 2013.
According to Forbes' 2013 Real Estate Forecast, the housing market as a whole is expected to continue a moderate recovery through 2013. Still, there are currently more vacant units on the market than demand can claim. Identifying the right vacation markets may be the key to finding (or investing in) potential rental properties that will hold their value in the long run.
Trulia reports on top vacation spots for 2013 in a market trends blog by Chief Economist Jed Kolko. Ocean City and North Wildwood, both in Cape May, New Jersey, top the charts. Other big-boom spots include Big Bear Lake and Lake Arrowhead in San Bernardino, California; Gatlinberg, Tennessee; Santa Rosa Beach and Kissimmee in Florida; South Lake Tahoe and Truckee near Lake Tahoe in California; East Hampton in New York; and Nantucket, Massachusetts.
Of the 20 most-searched vacation home zip codes in the United States in 2013 (Still according to Kolko at Trulia), the most expensive were in Nantucket and East Hampton, with home prices easily topping $1 million. More affordable home sites in the Top 20 included Gatlinberg, Tennessee (and the vicinity) as well as Cherry Grove Beach near Myrtle Beach, South Carolina.
What's Hot on the International Scene
Despite Spain's recent economic turmoil, Spanish vacation home sales are up disproportionately along the Spanish coastlines. According to the Spanish Real Estate Registry's annual report, non-Spanish national investments in the country as a whole were up 17 percent in 2012. British nationals had more than 16 percent of foreign market shares in 2012--about 1.25 percent of the Spanish property market as a whole. Britons retiring to sunny shores are boosting Spanish housing markets, and it's likely that expats from other countries will be joining the party in coming years.
Warm climates, tempting vacancies, and affordable market environments are combining to spur an international increase in vacation home sales. Gaining a little local insight and knowing the national/international markets will be pivotal in finding a vacation or (or recreational investment) property that gets you the most value for your money in the long term. In the right place, this is the right time to buy.
Edward Johnston with Dwell360 is a REALTOR® who services the cities and suburbs of metro Boston. He is focused on his customers and his experience in the residential real estate market is extensive. Search for homes in Massachusetts and then give Ed a call.