Vacation home buyers – are they back?

Since the real estate collapse in 2008 I think it is safe to say the vacation home buyers market has been some what on the back burner for many people, with uncertainty in the economy and else where this is, to say the least, understandable. However, in recent months vacation spots across the country have seen a marked increase in the second home market as consumer confidence numbers are improving.
The National Association of Realtors (NAR) reported a 7% increase year over year with second homes /vacation homes accounting for 11% of total sales volume and in some Southwest Florida counties inventories are hitting seven-year lows as buyers take advantage of low interest rates.
In line with the increase demand in vacation homes and strong demand for primary residences builders are starting to slowly increase groundbreaking on single family homes which edged up 3.2% in May, it’s highest level since December and up 26% from the same period last year. Once again, as previously talked about in my Blog, the Wells Fargo Housing Market Index is at its highest levels since 2007 under scoring the growing sentiment among builders that the single family housing market is starting to become more solidified.
This is further emphasized by the “Shadow Inventory”, (properties that are delinquent by 90 days or more, in the foreclosure process or foreclosed properties that have not been listed for sale), which is at its lowest levels in almost 3 years dropping approximately 15% in April with a 28% decline in California.
Add to this the Fed’s extension on the Twist Program which is aimed at pushing down long term interest rates with Fed Chairman Bernanke saying ” we are prepared to do what is necessary” and “provide support for the economy” you have a scenario where buyers are having a hard time saying no and are taking advantage of the current market conditions.
Vacation home buyers – are they back?, the market data would seem to say yes. If you are in the market for a second home and or vacation home please contact me at cristal@montecito-estate.com to explore your options.