Interesting Covid Side Effect

• The number of buyers who locked in mortgage rates for second homes soared 178% year over year in April, marking the 11th straight month of 80%-plus growth, reports Redfin.
• Affluent Americans working remotely from vacation destinations are driving second home sales.
• The rise demand for second home has more than doubled the increase in primary home, considering how primary home demand slumped to the pandemic last April.
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• Home prices in seasonal towns (where second homes are often located) rose 27% Y/Y in April to $450,000, whereas home prices in non-seasonal towns were up 28% to $419,000.
• The price jump touches a record high, however it is somewhat inflated because price growth was slow at this time last year due to stay-home orders and economic lockdowns related to the pandemic.
• “The combination of the wealthy becoming wealthier, remote work turning into the new normal and low mortgage rates is creating an ideal environment for affluent Americans to buy vacation homes,” said Redfin Chief Economist Daryl Fairweather. “As long as the economy continues to grow, I don’t foresee demand for second homes slowing down anytime soon.”

Deceptive said:

Hahaha! **** the peasants!


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Weather Man said:

Remember reading that people from NY were buying sight unseen around the state to work from.

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Weather Man said:

Remember reading that people from NY were buying sight unseen around the state to work from.

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7998 said:

I don't how people afford this shit. Especially factoring in taxes and maintenance. My wife and I both make good money and we couldn't dream of a 2nd home without over leveraging ourselves.

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tistan said:

Air bnb, look at the prices on abnb right now. I don't know if those prices will hold for years, but they are 2-3 times what the were 2 years ago. Lets say you spend $5-600k on a second vacation home. You have to put 20% down since it is not your primary residence. lets say your mortgage is $450k at 3.5 and that equals $2k add in $500 a month for taxes and insurance and you have a $2500 payment. A nice whole home is renting for $3-500 a night. 10 nights a month has payed your mortgage payment and then some. Most people claim their abnb rents an average of 20 days out of the month. Right now you can easily double your money every month while using the banks money to do it.

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7998 said:

I can see a lot of people doing that, but if you have to depend on renters to pay for it then good luck. What happens when not if The Great Reset hits the economy. That's just a little too much Live, Laugh, Love for today for me.

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SHOdown220 said:

Home prices are ****ed right now. We are trying to buy our first home and can't compete with the sight unseen paying over asking price people. I told my wife this morning it's very likely we don't get to buy anything now and we are just gonna have to deal with having a small place with the next kid due in august. It's either that or save up and pay over asking/appraisal amount.

It's partially our own fault, we talked about buying for the last 2 years but I had made the switch from one dealer to another (within the same employer) but even still our mortgage agent said they wouldn't count my income until I was at the new place for 2 years since I'm 100% commission.

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7998 said:

I don't how people afford this shit. Especially factoring in taxes and maintenance. My wife and I both make good money and we couldn't dream of a 2nd home without over leveraging ourselves.

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Blown 89 said:

**** two houses, I can't afford one home at this point in AZ. This is nuts. A friend of mine just lost out on a $500k house because someone offered $150k cash over list. House flippers and developers are the worst thing to happen to the housing market.

I've had my eye on a house around the corner from my dad for 15 years. The owner was very old so I knew it was coming up for sale at some point. Two days ago a for sale sign went up with a sold plackard already on it. It never even went up for sale. There's an underground housing network here in Phoenix where developers and flippers get first crack at homes before they are even listed. They buy reasonably priced homes for the lots then build multi-million dollar mansions that barely fit on the lots thus driving the comps through the roof. The average home price in Phoenix metro 6.4x the city's average dual family income. This housing market is worse than in 06.

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SHOdown220 said:

Home prices are ****ed right now. We are trying to buy our first home and can't compete with the sight unseen paying over asking price people. I told my wife this morning it's very likely we don't get to buy anything now and we are just gonna have to deal with having a small place with the next kid due in august. It's either that or save up and pay over asking/appraisal amount.

It's partially our own fault, we talked about buying for the last 2 years but I had made the switch from one dealer to another (within the same employer) but even still our mortgage agent said they wouldn't count my income until I was at the new place for 2 years since I'm 100% commission.

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