Wednesday, August 22, 2007
Doom and Gloom in today's real estate market? Maybe, but not in vacation home sales!
We've all been hearing about it! Everyone is talking about the slow real estate market and falling prices in home sales throughout the country. There are for sale signs on the corner of every street. Many sellers are waiting longer than ever, to sell their homes. Foreclosures and short sales are now at a all time high.
Things seem pretty bleak in today's real estate market. However, this may not be the case for vacation home sales!
According to a survey done by the National Association of Realtors, existing home sales decreased by 4.1% in 2006. However, vacation home sales increased by 4.7% (over the previous year). That's good news for sellers and buyers, alike! People who can still invest, are investing!
If you're thinking about purchasing a second home, this is the time to buy. With all of the bad press out there, second home buyers and investors are taking advantage of the market.
However, there are still some things that these buyers need to know before they dive into searching for the second home or investment property. Even though it's a buyer's market, vacation home sellers are not coming down on their prices as much as many buyers may think. I've had offers come is as low as 30% below list price, thinking that today's depressed market would reflect that! However, that is not the case with vacation homes, especially if it's waterfront property.
On occasion, there may be a situation where a seller is in a distressed position and will take a substantially lesser price for the vacation property. You can often find those situations in the local newspapers, with pending foreclosures on the rise. However, in most cases, if a property is priced right, it will still sell. Vacation home investors are still out there buying and are willing to pay near asking price, if it's a desirable property.
According to the statistics I pulled up for vacation home sales in my part of Mid Michigan, sellers are still getting 90-100% (on average) of their listing price for vacation home sales. In most cases, sellers are getting 93% or better, of their listing price! AND in some instances, sellers are getting 99-100% of their list price if the home (or property) is priced right and in a "high demand" location.
What's the good news for buyers?
Prices are remaining steady or dropping slightly, and inventory is still high. In the future, these properties will continue to increase in value and even in a poor market, these properties will still be easier to sell, than normal residential housing.
While full time residential housing is still taking a bad hit, vacation home sales are still thriving in a stale market.
So, if you've been thinking about investing in a vacation home or property, now is the time to jump in with both feet! You'll get the enjoyment of having that get-away you've always wanted, along with the benefits of being one of the growing number of vacation home owners/investors throughout the country. Now is the time to catch the vacation home ownership wave!