Vacation homes sales in 2014 were almost as hot as the beachfronts they sat on. Vacation home purchases rose 57% from 2013 to 2014—an astounding number and one that suggests buyer confidence continues to improve. For a place like the Gallatin Valley, with Big Sky and Yellowstone National Park so near, the vacation market can affect nearby home prices as well.
The 1.13 million home sales last year made up 21% of all home sales in the United States housing market. Vacation homes took their largest share of the market since 2003—but what has changed recently to make such a difference?
A lot of the improvement in sales can be attributed to the generally positive economic outlook that 2014 gave us—at least towards its end. Stock market performance and an improving labor market helped open up some spending money for a lot of homebuyers. Wages grew in both the US and Montana and both also have added new jobs over that year as well.
A typical second homebuyer in 2014 had a median income of $94,380. 58 percent of those buyers had their partner bringing similar income streams into the same family. 48% of vacation home buyers financed less than 70% of the total purchase price and 54% of the vacation homes bought were single-family homes.
Of course, many vacation homebuyers are better off than perhaps the standard American, but the relatively good value on these homes may have also contributed to high sales numbers. Last year, the median price for a secondary residence came in at $150,000—that’s an 11% decrease from 2013. Many homebuyers seem to have been waiting to buy low, to have it for vacation and investment purposes.
Baby boomers have also been attributed to improving vacation home sales. Many boomers have bought these homes as vacation homes to start, but plan on shifting it into a primary residence upon retirement.
In general, beach and mountain (yes, mountain) vacation homes tend to recover their value slower than other homes, so there may still be time to scoop up that ski lodge at a great price.
Source: http://money.cnn.com/2015/04/01/real_estate/vacation-home-sales/index.html
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