WASHINGTON (April 2, 2014) – Vacation home sales rose strongly in 2013, while investment purchases fell below the raised levels seen in the previous 2 yrs, according to the National Association of Realtors. NAR Chief Economist Lawrence Yun expected an improvement in the holiday home market. “Growth in the equity marketplaces has benefited high net-worth households, providing the wherewithal and confidence to purchase recreational property thereby,” he said.
Yun said the pullback in investment activity is understandable. “Investment buyers slowed their purchasing in 2013 because prices were rising quickly plus a declining availability of discounted foreclosures over the course of the entire year,” he said. “In 2011 and 2012, investment property was a no-brainer because home prices acquired sharply over corrected during the downturn in many areas, creating great discounts that might be turned into profitable renting quickly.
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With a return to more normal market conditions, investors will have to evaluate their purchases more and do their homework carefully,” Sun added. All-cash buys remained pretty common in the investment- and vacation-home market: 46 percent of investment buyers paid profits 2013, as did 38 percent of vacation-home customers. Of customers who financed their purchase with a home loan, large down payments continued to be the norm in 2013. The median downpayment for investment customers was 26 percent, while vacation-home customers typically put 30 % down. Forty-seven percent of investment homes purchased in 2013 were distressed homes, as were 42 percent of vacation homes.
Lifestyle factors stay the primary inspiration for vacation-home buyers, while rental income is the primary factor in investment buys. 85,600 and purchased a house that was a median distance of 180 kilometers from his / her primary residence; 46 percent of vacation homes were within 100 mls and 34 percent were more than 500 mls.
Five percent of vacation-home buyers acquired already resold their property, calendar year while another 9 percent plan to sell within a. “This reflects the 28 percent of recreational property buyers who said they purchased to diversify investments or saw a good investment opportunity,” Yun said. Season was in the South Forty-one percent of holiday homes purchased last, 28 percent in the West, 18 percent in the Northeast, and 14 percent in the Midwest. 111,400 and bought a home that was relatively close to their primary home – a median distance of 20 miles. Seven percent of homes purchased by investment buyers this past year have been completely resold, calendar year and another ten percent are preparing to be sold within a.
Thirty-eight percent of investment properties purchased last year were in the South, 25 percent in the West, 18 percent in the Northeast and 19 percent in the Midwest. A lot more than eight out of 10 second-home purchasers, both for holiday and investment homes, said it was a great time to buy. 43 Approximately.4 million people in the U.S.