Real Estate Outlook: Vacation Sales Surge
According to the National Association of Realtors’ 2012 Investment and Vacation Home Buyers Survey, there was a surge in sales of both investment and vacation homes in 2011.
Yun said the shift in investment buyer patterns in 2011 shows the market, for the large part, is able to absorb foreclosures hitting the market.
Increased investor purchases are partly responsible for the large percentage of all-cash purchases seen in the last year. They make up around one-third of all purchases. Forty-nine percent of investors paid cash in 2011.
“Clearly we’re looking at investors with financial resources who see real estate as a good investment and who aren’t hesitant to use cash,” Yun said. Of the buyers who didn’t use all cash they paid a hefty average 27 percent downpayment.
As opposed to investment purchases, which were made out of the desire for rental income, vacation homes were driven by lifestyle factors and were purchased by households making an average of $88,000 a year.
What portion of the market are these vacation sales? They accounted for 11 percent of all sales in the market.
Overall mortgage applications increased 4.8 percent, according to the Mortgage Bankers Association (MBA). The refinance share of the market decreased again to 71.2 percent. Just a few months back it was over 80 percent.
I would agree.. Sales have increased. Our market is up 6% YOY. That is an improvement. But it is still a buyers market, an opportunity to get a vacation home at more than 40% lower than just a few years ago. So things are improving. But we are still waiting to see what summer brings.