AgentMarkets & Economy

Vacation home markets going on sale?

NAR economist hints at buying frenzy as 'prices are down substantially' in coastal, ski areas

The vacation home market has been on vacation. Second-home buyers looking for that spot in the sun or at least on the side of a mountain with good ski terrain decided, en masse, to stay at home since the housing bubble burst starting about the middle of the last decade. I would like to announce that all the bad news has melted away, but I can't, despite some reports extolling a huge increase in vacation home sales. Here's my concern: The vacation home market is simply a weaker reflection of the general single-family market, and that the increase in sales is due to the clearing out of short sales and foreclosures. Under normal market conditions, vacation home markets look brighter than the general market because these are smaller areas with severe geographic limitations: only so much beach frontage or ski terrain surrounded by national forests. However, in a recession, the vacation home becomes what it really always was: a discretionary purchase that doesn't have to be mad...