Vacation home sales in 2013 were estimated by the National Association of Realtors to be 717,000, up 29.7% from 553,000 in 2012.
Investment-home sales in 2013, tracked in the same NAR report, were down 8.5% to an estimated 1.10 million, from 1.21 million in 2012. Owner-occupied purchases were up 13.1% to 3.70 million in 2013, from 3.27 million in 2012. NAR sales estimates are based on responses from households and do not include institutional investment activity.
NAR Chief Economist Lawrence Yun said he expected an improvement in the vacation home market. “Growth in the equity markets has greatly benefited high net-worth households, thereby providing the wherewithal and confidence to purchase recreational property,” he said.
He noted that vacation-home sales were still down by roughly a third from 2006's peak activity.
The organization said vacation-home sales accounted for 13% of all 2013 transactions, which was the highest market share for this category since 2006.
Investment sales accounted for 20% in 2013, down from 24% in 2012.
Yun said the pullback in investment activity is understandable.
“Investment buyers slowed their purchasing in 2013 because prices were rising quickly along with a declining availability of discounted foreclosures over the course of the year," he said. "In 2011 and 2012, investment property was a no-brainer because home prices had sharply over corrected during the downturn in many areas, creating great bargains that could be quickly turned into profitable rentals. With a return to more normal market conditions, investors now have to evaluate their purchases more carefully and do their homework."
The median investment-home price was $130,000 in 2013, up 13.0% from 2012's $115,000. The median vacation-home price was $168,700 in 2013, up 12.5% from $150,000 in 2012.
The profile of the typical vacation-home buyer in 2013, according to NAR's report:
• 43 years old
• $85,600 median household income
• bought a vacation home a median distance of 180 miles from his/her primary residence
• plans to own the recreational property for a median of 6 years, down from 10 years in 2012
Buyers' reasons for buying a vacation home:
• 87% want to use it for vacations or as a family retreat
• 31% plan to use it as a primary residence in the future
• 28% wanted to diversify investments/saw a good investment opportunity
• 23% plan to rent it out
• 22% intend it for use by a family member, friend, or relative
From analyzing U.S. Census Bureau data, NAR reported there were 8.0 million vacation homes and 43.7 million investment units in the United States; there were 74.7 million owner-occupied homes.
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