By Kerry Smith
Lee County tops NAR’s list of U.S. counties for the highest increase in vacation home sales, with Collier County also making the top 10 list. In 2020, vacation home sales were 5.5% of total existing-home sales; in 2019, they were 5%. Vacation home median prices were up 14.2%.
WASHINGTON – Vacation homes sales soared during the COVID-19 pandemic, according to a new study from the National Association of Realtors® (NAR) in its 2021 Vacation Home Counties Report. Overall, buyers flooded the real estate market in the second half of 2020 and through April 2021 as the pandemic raged, causing vacation home purchases to rise.
Florida remains a top spot for vacation home sales – two metros made NAR’s top 10 list, with Cape Coral at No. 1 – but Americans also showed a preference for other second-home hot spots, including four North Carolina metros that also made the top 10 list.
Top 10 U.S. metros with the largest uptick in 2020 vacation home sales
- Lee County, Fla.
- Oscoda County, Mich.
- Swain County, N.C.
- Collier County, Fla.
- Dukes County, Mass.
- Alleghany County, N.C.
- Garrett County, Md.
- Barnstable County, Mass.
- Alcona County, Mich.
- Macon County, N.C.
The percentage of 2020 vacation home sales out of all existing-home sales increased to 5.5%, an increase from 5% in 2019. Year-to-year, vacation home sales were up 16.4% in 2020, compared to the existing-home sales growth of 5.6%.
In 2021 so far (through April), the share of vacation home sales to total existing-home sales was 6.7% – a jump of 57.2% year-over-year compared to 20% for total existing-home sales.
“Vacation homes are a hot commodity at the moment,” says Lawrence Yun, NAR’s chief economist. “With many businesses and employers still extending an option to work remotely to workers, vacation housing and second homes will remain a popular choice among buyers.”
Traditional second-home locations – areas where vacant seasonal, occasional or recreational-use housing account for at least 20% of homes saw sales climb at a rate even higher than the overall market during this period. Existing-home sales from 1,060 non-vacation home counties increased by an average of 11.2% year-to-year; in 145 vacation-home counties, they jumped 24.2%.
According to NAR’s report, median existing-home sale prices in vacation counties also rose faster than in the rest of the country, up 14.2% compared to 10.1%.
Vacation-home counties did lag overall single-family home sales in one way: They took longer to sell. Nationwide, they remained on the market 59 days in 2020 compared to 30 days in 2019. But even this wasn’t as true in traditional vacation-home counties, where they sold 13 days faster in 2020 than they did in 2019. Nevertheless, homes largely sold at a faster pace in vacation home counties compared to the prior year by 13 days; in non-vacation counties, it was only 8 days.
“The enduring opportunity for remote work will continue to raise the already high demand for property in these counties, particularly in those counties with reliable broadband internet service,” Yun says.
Among the nine U.S. divisions included in NAR’s study, the South Atlantic (Delaware, Florida, Georgia, Maryland, North Carolina, South Carolina, Virginia, West Virginia and the District of Columbia) saw the strongest sales growth, with home sales up nearly 31% in 2020 in the vacation home counties.
The second highest sales growth was in the Middle Atlantic division (New Jersey, New York and Pennsylvania), with home sales typically up 27.8% in 2020 in vacation home counties. Third in line was the West South Central division (Arkansas, Louisiana, Oklahoma and Texas) where sales typically increased by 25.7% in 2020 in the vacation home counties. In the New England division (Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont), sales generally climbed 25.3% in 2020 in the vacation home counties.
In the midst of an ongoing supply shortage, Yun notes an increase in the number of buyers willing to pay for homes in all cash, especially for vacation homes. From January through the end of April 2021, all-cash sales increased to 53% of all vacation home purchases, up from under 50% in past years. In comparison, 22% of all existing-home sales over the same period were all-cash sales.
“Realtors all over the country have indicated that buyers in a position to pay in all cash are doing just that,” says Yun. “From a seller’s perspective, paying in this manner makes for a much more attractive offer given the strong demand right now for vacation homes. © 2021 Florida Realtors®