Vacation Homes on the Rise

Bucking the trend of a falling national real estate market, the vacation home market’s number of sales increased to all-time record levels in 2006, according to the annual National Association of Realtors vacation and investment buyers report.

The NAR report indicates an increase of 4.7% to a record 1.07 million units compared to 1.02 million dwellings in 2005. However, the same survey shows that investment properties sold at a lower rate than the previous year. Fourteen percent of all homes sold during 2006 were for vacation purposes.

The numbers of investors buying homes, condos and other property in the Destin market has slowed for nearly two years. Many wannabe or first time investors who sought quick turnarounds to make large profits during the booming market are now holding on to their properties as future investments. Speculators generally left the market in 2005.

The NAR study also paints a picture that the typical vacation home buyer is 44 years old with a median household income of $102,200 annually and purchased property that was a median of 215 miles from their primary residence.

The study coincidentally matches the over-whelming majority of second home and condo owners in the Destin market, whose principal residences are located in major urban centers located through the south-east. The Atlanta Metropolitan area represents the largest number of owners in the Destin and South Walton markets.

The median age of the vacation home buyer dropped from 52 in 2005, showing a marked decrease in the age of buyers who are seeking out a higher quality of life during their time off from work. The difference represents a significant change in the habits of those buying second homes and shows that younger people not just the baby boomer generation is purchasing more vacation properties.

Many younger vacation home buyers have felt pressured to make purchases now rather than wait for future years due to the increasing cost of homes and condos in many second home markets. The vacation home market is projected to increase in sales volume over at least the next twenty years.