With home prices becoming more affordable and interest rates at an all-time low, it’s no wonder that more people are purchasing vacation home. But one thing is different in this economic climate. Whereas buyers used to purchase homes in exotic locations that required trains, planes, and automobiles to reach, many are opting for vacation homes that are just a short drive away.
Part of the reason is rising travel costs. Another: uncertainty about what the economy might do next. It makes more financial sense for people to purchase in nearby vacation communities versus plunking down money on a vacation home that’s out-of-state and expensive to reach. According to a survey by NAR, the median distance between a buyer’s primary residence and his vacation home declined 19% between 2010 and 2011.
Florida and Nevada, two states that have long been havens for vacation home seekers, are attracting more buyers from nearby states and within their own borders. Buyers, especially retirees, still want to spend their time in climates that are temperate year-round. In fact, retirees make-up a large portion of the vacation-home buying demographic, as they are using a vacation home as bridge between a single-family home and a retirement one.
Another reason that is keeping people closer to home is the ability to maintain their vacation homes. With more family and friends nearby who can use and help upkeep the home, buying something a short drive away can make a lot of sense. According to HomeAway.com, a website that lists vacation rentals, the most popular markets for vacationers are those that can be reached in within a four-hour drive from a person’s primary residence.
Now is a great time to consider purchasing a vacation home, as prices continue to fall. The median sales price has declined 19% between 2010 and 2011 according to NAR. This trend in pricing is benefiting towns in the Northeast and lakefront communities in the Midwest, as well as places in California like the Coachella Valley.