Second Home Transaction Volume Decreased from Pandemic Peak but Still Higher than Pre-pandemic Levels - Oct 6, 2021
Second Home Transaction Volume Decreased from Pandemic Peak but Still Higher than Pre-pandemic Levels
Pacaso's Second Home Market Report finds 49 of the 50 top destinations saw double-digit price growth in summer months
- National second home rate locks soared during the pandemic, more than doubling their level from a year earlier (peaking at 103.7% YoY growth as of fall 2020), but fell 26.6% YoY this summer.
- Second home mortgage rate locks continue to account for a higher share of the total market than they did before the pandemic.
- Kauai County, Hawaii saw the greatest appreciation, with second home median sale prices up 83.3% YoY.

SAN FRANCISCO, Oct. 6, 2021 /PRNewswire/ -- Pacaso, the leading real estate platform that helps people buy and co-own a second home, today released the new Pacaso Second Home Market Report, the most timely and localized data available for the top 50 second home markets. The report is a composite including property use and mortgage rate lock data. It includes counties with a percentage of seasonal homes and median home values at or above the top 20th percentile. Mortgage rate lock data is a leading indicator of second home buying activity.

"A year ago as Pacaso was preparing to launch, we wanted to better understand the second home market, and quickly realized there was a massive gap in local, timely second home data," said Pacaso CEO Austin Allison. "It's estimated that there are nearly 10 million second homes in the U.S., and with pandemic-driven shifts that have allowed people greater flexibility around where they live and work, we expect to see this number continue to grow. The second home housing market represents a significant subset of the market that is critical to watch in order to fully understand the U.S. housing market."

The report found that across the nation, second home rate locks--a proxy for transactions-- increased throughout the pandemic, peaking in Summer 2020 and again in Spring 2021, but falling 26.6% year over year this past summer. Despite this recent cooling of the pandemic-fueled second home surge, overall market share of second homes is still up from pre-pandemic levels. From 2017 through 2019, second home transactions averaged a 3.8% quarterly market share of all rate locks. As of summer 2021, that percentage was up from pre-pandemic levels, with second homes comprising a 4.3% market share.

Across the board, second home transactions are mostly down, but prices remain highly elevated and continue to rise. All but one county tracked in Pacaso's report saw double-digit price growth in second home purchase prices this past summer. Kauai, Hawaii saw the highest growth, with a median purchase price of $1.25 million, up 83.3% compared to a year ago. The island of Kauai has seen sharp growth in tourism and leisure travel since travel bans to the area were lifted. Wasatch County, Utah and Gunnison County, Colorado also saw sharp increases, up 53.9% and 53.2% respectively year over year. Prior to this spike, Wasatch County historically had a lower median second home price than neighboring Summit County, Utah, which is home to popular resort town Park City. Meanwhile, Gunnison County, located in the Colorado Rockies and home to ski resort Crested Butte, still has a lower median second home price than neighboring Summit County, Colorado, which is home to Breckenridge.

Of the top 50 second home destinations analyzed, 46 saw a year-over-year decline in transaction activity in the summer months. However, four markets stood out as exceptions: In Kauai, Hawaii, rate locks for second homes were up 23.5%. Summit County and Eagle County, Colorado, also saw annual increases of 10.2% and 9.8%, respectively, and Boise County, Idaho, saw a 4.4% increase in second home mortgage rate locks year over year.

"It's clear that there's been a sea change not only in where people live and work, but also where they choose to get away from it all. The market looks completely different than it did two or three years ago," said Pacaso CEO Austin Allison. "It used to be that major metros were the primary hotbeds of real estate activity, and now we are seeing double-digit price growth across the entire U.S., and intense interest in second homes in places like Boise, Idaho, and Eagle County up in the Colorado Rockies. This widespread demand is creating a new wave of second home markets with more moderate median home prices but the same types of amenities and outdoor recreation options typical of their more famous counterparts."

At the other extreme, El Dorado County, California saw the biggest decline in second home mortgage rate lock volumes, down by 62.5%, which was almost certainly related to this summer's wildfires in Lake Tahoe. Cass County, Minnesota (-60.7%), Chelan County, Washington, and Beaufort County, South Carolina were just behind, both down 59% year over year. Most of these markets posted extreme growth the year before, which was not sustained.

Methodology
Pacaso identified the nation's top second home markets by compiling census data on counties with a percentage of seasonal homes and median home values at or above the top 20th percentile and by excluding those below the bottom 10th percentile of counties with the fewest households. Counties without at least 20 second home transactions in the period were also excluded from the analysis.

Pacaso then analyzed real estate activity in the top second home markets by observing mortgage rate lock data, a leading indicator of second home buying activity. When applying for a mortgage rate lock, a home buyer must specify whether they are securing a mortgage rate for a primary home, secondary home or an investment property. Approximately 80% of mortgage rate locks result in home purchases. Mortgage rate lock data was provided by real estate analytics firm Optimal Blue and includes a sizable share of the market that is taken to be representative of the whole. Second home rate lock transactions and median purchase price data were sourced at the county level with the months June through August 2021 comprising the "summer" period in this analysis.

To view the complete report, please visit the Pacaso blog.

Pacaso Second Home Market Report

County

Metro (For Reference

Share of 2nd
Home Rate
Locks

2nd Home
Transactions
YoY

Median 2nd
Home
Purchase
Price

Median 2nd
Home
Purchase
Price YoY

Median 2nd Home
Purchase Price Last
Year

Summit County, Colorado

Breckenridge, CO

60.2%

10.2%

$821,000

30.5%

$629,000

Summit County, Utah

Park City, UT

28.4%

-42.4%

$915,000

20.5%

$760,000

Valley County, Idaho

McCall, ID

58.1%

-51.7%

$585,000

46.6%

$399,000

Barnstable County, Massachusetts

Barnstable, MA (Cape Cod)

33.5%

-56.2%

$660,000

25.7%

$525,000

Eagle County, Colorado

Vail, CO 

30.1%

9.8%

$975,000

43.3%

$680,000

Grand County, Colorado

Granby, CO (Winter Park)

59.9%

-24.2%

$695,000

20.9%

$575,000

Mono County, California

Mammoth Lakes, CA

41.1%

-58.4%

$679,000

33.9%

$507,000

Cape May County, New Jersey

Ocean City, NJ

55.1%

-53.5%

$650,000

28.7%

$505,000

Park County, Colorado

Fairplay, CO

34.8%

-14.6%

$559,000

34.7%

$415,000

Gunnison County, Colorado

Crested Butte, CO

31.8%

-41.3%

$780,000

53.2%

$509,000

Routt County, Colorado

Steamboat Springs, CO

30.5%

-37.5%

$740,000

45.5%

$509,000

Monroe County, Florida

Key West, FL (Florida Keys)

34.6%

-44.0%

$780,000

22.8%

$635,000

Worcester County, Maryland

Ocean City, MD

58.4%

-53.5%

$375,000

19.6%

$314,000

Calaveras County, California

San Andreas, CA

27.0%

-46.4%

$495,000

36.0%

$364,000

Collier County, Florida

Naples, FL

24.2%

-21.3%

$455,000

11.0%

$410,000

Dare County, North Carolina

Kill Devil Hills, NC

49.0%

-47.3%

$510,000

24.8%

$409,000

Archuleta County, Colorado

Steamboat Springs, CO

32.0%

-53.9%

$492,000

22.6%

$402,000

Wasatch County, Utah

Heber, UT

21.9%

-39.5%

$947,000

53.9%

$616,000

Carroll County, New Hampshire

Conway, NH

35.8%

-26.6%

$397,000

34.6%

$295,000

Tillamook County, Oregon

Tillamook, OR

39.1%

-12.8%

$529,000

21.6%

$435,000

Nevada County, California

Truckee, CA

15.1%

-43.5%

$956,000

39.6%

$685,000

El Dorado County, California

South Lake Tahoe, CA

9.0%

-62.5%

$600,000

14.2%

$525,000

Sussex County, Delaware

Rehoboth Beach, DE

32.1%

-38.2%

$475,000

14.7%

$414,000

Beaufort County, South Carolina

Hilton Head Island, SC

21.2%

-59.0%

$496,000

28.8%

$385,000

Tuolumne County, California

Sonora, CA

20.8%

-41.1%

$425,000

34.9%

$315,000

Clatsop County, Oregon

Astoria, OR

20.3%

-16.7%

$505,000

16.2%

$435,000

Boise County, Idaho

Boise, ID

44.4%

4.4%

$509,000

45.1%

$351,000

Watauga County, North Carolina

Boone, NC

47.3%

-48.0%

$413,000

13.0%

$365,000

Lincoln County, Oregon

Newport, OR

23.8%

-31.4%

$490,000

11.5%

$440,000

Washington County, Rhode Island

Providence, RI

24.2%

-39.4%

$660,000

22.5%

$539,000

Kauai County, Hawaii

Kapa'a, HI

19.1%

23.5%

$1,250,000

83.3%

$682,000

Kane County, Utah

Kanab, UT

56.5%

-49.0%

$360,000

28.6%

$280,000

Belknap County, New Hampshire

Laconia, NH

25.5%

-42.4%

$421,000

17.8%

$358,000

Walton County, Florida

Miramar Beach, FL

37.0%

-35.1%

$750,000

27.8%

$587,000

Currituck County, North Carolina

Currituck, NC (Outer Banks)

25.4%

-58.8%

$655,000

37.9%

$475,000

Coconino County, Arizona

Flagstaff, AZ 

31.2%

-48.0%

$558,000

36.1%

$410,000

Bonner County, Idaho

Sandpoint, ID

20.5%

-53.5%

$675,000

37.8%

$490,000

Lake County, Montana

Polson, MT

30.1%

-38.9%

$583,000

22.8%

$474,000

Kittitas County, Washington

Ellensburg, WA

21.4%

-36.8%

$633,000

10.0%

$575,000

Camden County, Missouri

Camdenton, MO

48.0%

-52.6%

$319,000

21.2%

$263,000

Hancock County, Maine

Bar Harbor, ME

30.1%

-44.4%

$420,000

20.0%

$350,000

Carteret County, North Carolina

Emerald Isle, NC (Crystal Coast)

34.0%

-44.5%

$464,000

26.1%

$368,000

Windham County, Vermont

Stratton, VT

35.5%

-56.9%

$338,000

32.4%

$255,000

Nelson County, Virginia

Lovingston, VA (Shenandoah Valley)

45.5%

-28.6%

$374,000

30.2%

$288,000

Chelan County, Washington

Wenatchee, WA

25.0%

-59.0%

$699,000

39.8%

$500,000

Brunswick County, North Carolina

Carolina Beach, NC

22.4%

-54.1%

$447,000

28.5%

$348,000

Grafton County, New Hampshire

Lebanon, NH

18.0%

-57.6%

$329,000

25.9%

$261,000

Cass County, Minnesota

Lake Shore, MN

33.9%

-60.7%

$405,000

24.6%

$325,000

Windsor County, Vermont

Hartford, VT

28.1%

-37.3%

$406,000

16.0%

$350,000

Lee County, Florida

Sanibel Island, Fl

16.7%

-3.6%

$350,000

8.0%

$324,000

About Pacaso
Pacaso® (pronounced like "Picasso") modernizes the decades-old practice of co-ownership by creating a marketplace that makes buying, owning, and selling a luxury second home easy. From curating the best listings in top second home markets to offering integrated financing and sales from as little as ⅛ to as much as ½ ownership; upscale interior design; and professional property management, Pacaso provides owners with all the benefits of owning a second home with less hassle. After purchase, Pacaso manages the home on an ongoing basis and supports a frictionless resale process in partnership with a licensed real estate professional.

Pacaso was co-founded by former Zillow executives Austin Allison and Spencer Rascoff.

Contact: Amy Musser, amusser@pacaso.com

 

SOURCE Pacaso