WASHINGTON – Aug. 2, 2011 – Home price declines remain the norm in many areas, but experts say certain luxury markets are picking up steam and attracting affluent vacation-home buyers.
The median second-home price fell 11 percent to $150,000 in 2010 from the prior year, according to the National Association of Realtors® (NAR). And the price dropped 25 percent since 2006, compared to a 22 percent decrease for the overall housing market.
Experts say sales activity depends on geography, with buyers more interested in prime vacation spots. However, financing remains a challenge since banks remain skittish about writing jumbo mortgages.
For many second-home buyers, though, the investment value is not a big concern. NAR says more than 80 percent of second-home buyers made their purchases to simply enjoy the home – not as an investment – with the number of all-cash deals up to 36 percent in 2010 from 29 percent in 2009, enabling buyers to forego a complex mortgage process.
Prices have stabilized or started to rise in Santa Monica, Calif.; Aspen, Colo.; the Hamptons, N.Y.; and Hilton Head, S.C. Meanwhile, Martha’s Vineyard, Mass.; Vail, Colo.; and Miami and Palm Beach remain depressed but offer some bargains.
Source: Wall Street Journal (07/23/11) Silver-Greenberg, Jessica