Investing in real estate has long been a solid financial strategy, with property values generally appreciating over time. But the property market can also be cyclical, with prices fluctuating over time. During the Great Recession, many people lost their homes as prices plunged, leaving them owing more on their mortgages than their properties were worth. Since then, home prices have rebounded, but buyers are still cautious about buying vacation homes, especially given the economic uncertainty and the possibility of a downturn.
During the COVID-19 pandemic, vacation home demand skyrocketed as affluent Americans took advantage of rock-bottom mortgage rates and flexible remote work policies to purchase properties in sunny vacation towns. But now that the pandemic is nearing an end and companies are calling their employees back to the office, home ownership in vacation markets may not be as attractive as it once was. In fact, according to Redfin’s analysis of Optimal Blue mortgage data, rate locks for second homes fell 52% on a seasonally adjusted basis compared to pre-pandemic levels in March — more than double the decline for primary home loans. Read more https://www.happygoluckyhomebuyer.com/sell-your-house-fast-in-avon-in/
Even in places with high home prices, such as Astoria, Oregon or North Port, Florida, it’s now challenging for most Americans to afford a second home. And it’s especially difficult to buy a vacation home with the intention of renting it out on short-term rental sites like Airbnb. The reason: local governments are instituting new regulations, such as taxes and strict permitting requirements, that make it harder to turn a profit on short-term rentals.
But that doesn’t mean buying a vacation home is completely out of the question for affluent buyers. For example, some are buying properties in cities with strong tourism and leisure-related industries that can offset rising mortgage rates, such as New York City or San Francisco. Affluent cash buyers are also willing to pay for a second home above asking price if they think it will increase in value.
Ultimately, whether it’s a vacation or investment property, it’s important to perform extensive research before making any decisions. With the help of real estate tools and platforms, such as Mashvisor, you can find the right property for your needs. To get started, sign up for a 7-day free trial of Mashvisor today! Plus, receive 15% off your first month.
