Why a Vacation Home Is the Ultimate Summer Upgrade
Summer is officially here and that means it’s the perfect time to start planning where you want to vacation and unwind this season. If you’re excited about getting away and having some fun in the sun, it might make sense to consider if owning your own vacation home is right for you. An Ameriprise Financial survey sheds light on why people buy a second, or vacation, home (see below): Vacation destination or a place to get away from the stresses of everyday life (81%) – Having a second home to use as a vacation spot can be a special place where you go to relax and take a break from your daily routines and stressors. It also means you won’t have to worry about finding somewhere to stay when you go there. Better weather (49%) – Buying in a place where there may be nicer weather can be a great escape, especially if it’s cold or rainy where you usually live. It lets you enjoy sunny days and warm temperatures, even when it’s not so nice back home. Rental income (41%) – You can rent it out to other people when you’re not using it, which can help you make some extra money. Primary residence in the future (33%) – You can eventually move into the home full-time during retirement. That means you can enjoy vacations there now and have a getaway ready for your future. Having a venue for gatherings with family and friends (25%) – It would be a special spot where you can have parties, regular family trips, and create fun memories. Ways To Buy Your Vacation Home And you don’t have to be wealthy to buy a vacation home. Bankrate shares two tips for how to make this dream more achievable for anyone who’s interested: Buy with loved ones or friends: If you’re okay with sharing the vacation home, you can go in on the purchase price together and pool your resources to make it more affordable. Put a savings plan in place: This will require patience and persistence but consider adding a vacation home savings plan to your budget and contributing to it monthly. Finding Your Dream Spot with a Little Help from an Agent If the idea of basking in the sun at your very own vacation home sounds appealing, you might want to start looking now. Summer's when everyone's trying to buy their slice of paradise, so it’s best to start early. Your first move is to team up with a real estate agent. They know all the ins and outs of the area you want to be in, and which homes you should look at. Plus, they can give you the lowdown on everything you need to know about having a second home and how it can benefit you. The same article from Bankrate says: “Buying real estate in a new area — or even one you’ve vacationed in for many years — requires expert guidance. That makes it a good idea to work with an experienced local lender who specializes in loans for vacation homes and a local real estate professional. Local lenders and Realtors will understand the required rules and specifics for the area you are buying, and a local Realtor will know what properties are available.” Bottom Line If the idea of owning your own vacation home appeals to you, let’s chat.
Homebuilders Aren’t Overbuilding, They’re Catching Up
You may have heard that there are more brand-new homes available right now than the norm. Today, about one in three homes on the market are newly built. And if you’re wondering what that means for the housing market and for your own move, here’s what you need to know. Why This Isn’t Like 2008 People remember what happened to the housing market back in 2008. And one of the factors that contributed to that crash was that there were too many homes for sale. While only part of the oversupply back then came from builders, the lasting impact is that some people still feel uneasy when they hear new home construction has ramped up. Even though the supply of new homes has grown this year, the data shows there’s no need to worry. Builders aren’t overbuilding, they’re just catching up. The graph below uses data from the Census to show the number of new houses built over the last 52 years. Following the crash in 2008, there was a long period of underbuilding (shown in red). And it wasn’t until recently that we finally met the long-term average for how many homes are built in a typical year. This shows, that even with the increase in new builds we’ve seen lately, there won’t suddenly be an oversupply of homes for sale. There’s too much of a gap to make up after over a decade of underbuilding. And if you’re still worried builders are overdoing it, here’s something else that should be reassuring. New Home Construction May Be at Its Peak for the Year The latest data from the Census on housing starts (homes where builders just broke ground) and permits (homes where builders can start development soon) shows builders are slowing down their pace right now. Why is that? They’re responding to still high mortgage rates and how those are impacting buyer demand. Basically, they’re pulling back appropriately in response to what’s happening in the market. As an article from HousingWire explains: “Even with a massive housing shortage across the nation, homebuilders are completing their pipelines and not seeking as many permits to construct new single-family houses.” Builders remember what happened when they overbuilt in the crash, and they’re looking to avoid a repeat of that. So, they’re being mindful and pulling back a bit. You May Have More Options Now Versus Later If you’re considering a newly built home, here’s how this impacts you. With builders seeking fewer permits and not breaking ground on as many new homes, we may be at the peak of new home construction for the year. This doesn’t mean new home construction is screeching to a stop – just that the pace is slowing down now, and that’ll impact what comes to market later this year. As Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), says: “Given the recent declines in housing starts, home completions will steadily show declines in about six months.” So, if you’re ready and able to buy now, you may find you’ll have more newly built options to choose from now versus later on. This may be enough reason to kick off your search. Just be sure to work with a local real estate agent you know and trust throughout the process. An agent will have valuable insight into builder reputations and other key factors specific to your market. And if there isn’t much new construction near you, they’ll be able to point you toward a nearby area where there is. Next Steps While it’s true new home construction is a bigger segment of the market than the norm, that’s not a bad thing. Builders aren’t overbuilding, and they’re responding to market signals to avoid repeating the mistakes that were made in 2008. If you want to buy now while new home options may be at their peak, let’s connect.
The Sweet Spot for Buying Luxury Homes
If you’ve been looking for a home at the high end of your market, but haven’t found the right one, you may have put your search on hold. But according to recent data, now may be the time to jump back in. Here’s why. There Are More Luxury Homes To Choose From What’s considered the top-end of the market, or a luxury home, will always vary by location. But generally speaking, they’re homes that are valued in the top 5% of any given market. According to a recent report from the Institute for Luxury Home Marketing, the selection of luxury homes is increasing (see graph below): As the graph shows, there are considerably more single-family luxury homes available now than there were a year ago. In fact, there are even more than there were just a month ago. This means you should have a wider variety of top-of-the-line homes to choose from, each with unique features and styles. Whether you were searching for the latest design elements, like modern kitchens with chef-grade appliances, a breathtaking view, or integrated smart home technology, more luxury inventory means you should have an easier time finding one that matches your taste and lifestyle. Rising Luxury Home Prices Can Help You Build Wealth Another important factor to consider is that luxury home prices are on the rise. According to HousingWire, luxury home prices have increased by 8.7% over the past year. That’s why: “People with the means to buy high-end homes are jumping in now because they feel confident prices will continue to rise . . . They’re ready to buy with more optimism and less apprehension.” This means buying before prices climb higher – and while more inventory is on the market – may be your sweet spot. Because home prices are rising, owning a home could help you build more generational wealth over time. On the other hand, if you wait to buy, you might end up paying more for the same home later on as luxury prices continue to rise. Next Steps With growing inventory and rising prices, you have a greater selection of luxury homes to choose from and an opportunity in front of you. Want to see the higher-end homes that are available in our area? Let’s connect today.
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