August 12th, 2011 Categories: Real Estate News
Have you ever vacationed in a favorite locale and thought, “I’d love to own a home here.”
It might be time to give that notion serious consideration as we draw towards the end of our traditional summer vacation months. Several factors are currently in place which make owning a vacation home a viable opportunity and a worthwhile investment.
Vacation homes are more affordable than they’ve been in recent years, making a secondary residence a way to save money, generate income and build equity.
Not only will you always have a home waiting in your favorite vacation spot, you have the option to rent it for select periods of time. In fact we are renting a house later this month through Vacation Rental by Owner (VRBO).
It’s also possible that this second residence might eventually become a primary residence, allowing a way to start preparing now for retirement.
According to the National Association of REALTORS®, lower prices have opened up the door for more families to own vacation homes. The median price of a vacation home was $150,000 in 2010, an 11.2 percent drop from when the median price was $169,000 in 2009. As a comparison, the median price of a primary residence in 2010 was $176,700, 4.5 percent less than the $185,000 median in 2009.
The housing market in general is favorable for qualified buyers at this point in time. Home prices are down an average of 27 percent from peak values five years ago. Even though second mortgages tend to have higher rates and shorter terms, interest rates as a whole remain near historic lows.
If you’re thinking of purchasing a vacation home, there’s another reason to consider it now: Unless Congress acts soon, conforming loan limits are being reduced on October 1, decreasing the availability and affordability of mortgage credit for many buyers.
If you want to understand what is happening in the real estate industry as it directly impacts your buying and selling decisions, look to the linked graphs below and then call me at 703.927.4554.
I will provide you with facts and the current market conditions that are relevant to you, in your local area. It’s my job to dissect those national headlines and give you the right kind of information you need to make the right decisions.
Let’s do this together,