The market for vacation homes across the U.S is booming. Sales went up last year to heights not seen since the times of economic prosperity, fueled by hefty cut rates, cash purchases, and home buyers increasing stock collections.
Pebble Beach sales for 2010 were 17.2% ahead of last years sales. 75 homes sold in Pebble Beach in 2010 as compared to 64 total sales in 2009. December 2010 average sales price was at the highest level compared to December 2008 and 2009. CLICK HERE for a detailed Pebble Beach Real Estate Market Report.
Harbor sales on Mercer Island in Washington almost tripled last year. Vacation homes sales on Hilton Head Island in South Carolina, soared 14% in 2010. On Palm Beach, Florida, sales got a 40% yearly increase and 54% raise in homes under contract, a sign of a solid last quarter. The volume of sales in Palm Beach is now a match to its 2007 boom.
Nicole Truszkowski, a real estate broker with Sotheby’s International Realty in Pebble Beach said that they haven’t felt energy like this in a while. Buyers are jumping on the particular market scene again after a long stay on the sidelines.
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But will the energy last? The overall pulse and market specific to Pebble Beach is good…Realtors, Sellers and Buyers are optimistic!
According to a trade and lobbying group called National Association of Realtors, home sales last November rose 5.6% on a yearly basis. On December 2010, the Case-Shiller housing index of 20 cities demonstrated prices throughout the country dropped in October; a lot of analysts foresee another 5 to 10 % decline in the year to come.
The 2010 results for the nationwide vacation-home market survey conducted by the NAR won’t be publicized until March.
Looking on local sales data, the market for vacation homes seem to be on the rise. NAR economist Lawrence Yun implied that the return was made possible by gains in the stock market and the way the economy is getting back on its feet. This has made more affluent Americans more optimistic about what lies ahead. It also means that significant cut rates in some market made people fight for those properties. He also noted that demand is strongest in places of close proximity to established labor markets.
NAR data showed that one in ten real-estate transactions 2 years ago was for the acquisition of a vacation home. It is a tiny portion of the overall housing market, but significant enough because vacation homes are generally high-cost properties and appeal to flexible home buyers.
Second homes sales are demonstrating an increase in more budget-friendly communities. In some areas, costs of second homes are going up. Sales on Cape Cod Massachusetts had an almost 9% ascent last year from 2009, whereas prices soared 7%. Monroe County in Pennsylvania witnessed a 3% drop in transactions, while Lake Naomi resort community reached nearly 15% increase. A big-ticket property on an acre of land in Lake Naomi was recently obtained for $1.1 million.
Improvement on demands doesn’t necessarily mean improvement on prices – this is the case in most markets. According to Realtor Andy Twisdale in Hilton Head South Carolina, it is too soon to celebrate; prices are down almost a third over the last five years. He also implies that people are acquiring at the lowest end of the product, since financing is still stiff. Banks have constrictive terms and policies. They require 25% down payment and a spotless credit record.
In Pebble Beach the December 2010 selling price per square foot was $779 it was up 39.3% from $559 last month and up 90.2% from $409 in December 2009. A number of second homes had been sitting on the market due to the sellers’ refusal to budge on price, in contrast to owners of primary homes, sellers generally aren’t eager to move. They know that they have to price their properties accordingly.