Industry NewsMarkets & Economy

NAR: Vacation home market cooling while investments heat up

Survey indicates buyers are eager despite low inventory and tight financing
  • Vacation home sales declined to 920,000 in 2015, down 18.5 percent from 2014's peak of 1.13 million. But, owner-occupied purchases were at their best levels since 2007.
  • Investment-home sales jumped to an estimated 1.09 million, 7 percent higher than 2014's 1.02 million.
  • Despite the obstacles of low inventory and tight financing, 80 percent of vacation home and investment buyers believe it's a good time to buy real estate.

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Vacation home sales are down and investment purchases are more prevalent than they've been for the past five years, according to the National Association of Realtors' 2016 Investment and Vacation Home Buyers survey. Total vacation home sales declined to 920,000 in 2015, down 18.5 percent from 2014's peak of 1.13 million. Furthermore, vacation home sales accounted for 16 percent of 2015's transactions, which is 5 percent less than the previous year. Vacation home prices grow as sales decline Despite decline in sales and transaction shares, the median price of a vacation home jumped significantly to $192,000 -- 28 percent higher than 2014's $150,000 average. 2015's owner-occupied purchases stood at 3.74 million, a 15.4 percent jump from 2014 and the best numbers we've seen since 2007. Fifty-eight percent of vacation buyers purchased single-family homes, and the most popular region for vacation home purchases was the South, accounting for 47 percent of the market. On the ot...