The vacation home market follows the same highs and lows as the residential home market . This segment faded out during the recession , but a new survey out from the National Association of Realtors shows strength once again in this sector .
 


Sales of vacation homes ( both new and existing ) climbed 10.1 % to 553,000 last year from 502,000 in 2011 . Meanwhile , investment home sales declined 2.1 % to 1.21 million from 1.23 million the previous year . Vacation homes are purchased mainly for the owner ’ s use , whereas investment homes are used mainly as rentals .
 


Median prices of vacation homes also increased to $ 150,000 in 2012 , up from $ 121,300 in 2011 . The Realtor group attributed the increase to increased sales of more expensive properties .
 


I called upon a good friend of mine , Peter Sobrero , who has spent his entire career selling some of the most prestigious luxury homes throughout the United States and World to get his thoughts on the status of vacation homes . Peter says , “ We are seeing strong purchasing in the luxury destination markets within the U . S ., and within close proximity . I hear from many of clients that they are tired of waiting , the pricing is right , and they and their kids and grandkids are not getting younger . This affluent sector has the

cash stores and want what they want , it seems we are seeing the willingness now to take action .”
 


The vacation home market is interesting to watch because although it tends to follow the residential housing market as a whole , it ’ s driven by somewhat different factors . NAR points out that all-cash purchases remain common , with 46 % of vacation home buyers purchasing this way . And of buyers who financed their purchase , large down payments ( a median of 27 %) remain common .
 


There ’ s no doubt that attractive prices were a big draw for many buyers of vacation homes in 2012 .


In the investment home market , which is mostly rental driven , the median price was $ 115,000 in 2012 , up 15 % from $ 100,000 in 2011 . Investment buyers for the most part bought a home that was relatively close to their primary residence , a median of 21 miles .
 


Property flipping increased modestly , though NAR said that flipping this time around is not the same as it was during the height of the housing boom . Rather , investors are making real improvements to their properties before reselling them . In fact , 6 % of the homes purchased in 2012 by investment buyers have already been sold , and another 8 % plan to sell in the next year .
 


If you ’ re in the market for a vacation or investment home or have clients who are thinking about this , the survey is an interesting gauge . But it ’ s also useful as we assess the overall health of the housing recovery across the U . S .
 


November 2012 thru January 2013 February 2013 thru April 3013

Marta is the recipient of top honors at the Intero Real Estate Services Annual Achievement Awards : Top Producing Agent for 2012 Gilroy Intero Office — putting her in the top 5 % of all Intero Real Estate Services nationwide .

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