Demand for second homes drop
Fewer buyers were looking for vacation homes in August, as the demand for second homes dropped for the third month in a row.
The number of buyers who locked in mortgage rates for second homes fell 19.3% year over year in August, according to a report from Redfin, a huge difference from the 78% year-over-year spike seen in April.
During the pandemic, vacation home demand soared surging as much as 172% in April, nearly double the year prior, when many affluent Americans were looking to leave city life during the stay at home restrictions. The increase in remote work also contributed to the surge.
Vacation home sales comprised 6.7% of existing home sales in the first four months of 2021, up from 5% in 2019, according to a recent National Association of Realtors report.
Redfin Lead Economist Taylor Marr said even though interest in second homes is lower than last year, it’s still above pre-pandemic levels. She also said it will likely stay elevated as many Americans shift to permanently working remotely.
“The pandemic isn’t over, but the desire to escape isn’t as intense as it was before,” she said in a release. “People are increasingly returning to life as normal, with kids going back to school and cities coming to life again. The housing market as a whole is still booming, just not as strongly as it was in the second half of 2020. Homebuyer competition, migration and home-sales growth have all slowed.”