Master the Art of Vacation Home Sales
Vacation properties make up a small portion of the real estate market but remain a valuable source of income for real estate agents. While there were 4,207 sales of primary residences in 2016, there were 721 vacation home sales in that same year. Though they are small in number, these vacation homes are typically the same median price as primary residences and prices are slowly growing. If you live in an area where your clients might be interested in a beach, lakefront, or mountain residence, the below tips will help you manage these essential sales.
Embrace the Competitive Market
With fewer annual sales and less supply than residential homes, this particular market will be more aggressive. If you’re interested in specializing in vacation homes, you will need to change your marketing strategy to work with this unique market. Your clientele might be slightly different than what you’re typically used to if you’re a commercial or residential real estate agent. Instead, those shopping for vacation homes could be anyone from a collective of family members to luxury real estate investors. To truly master this market, you will need to alter your marketing materials and style to appeal to the needs of this industry.
Keep Your Clients Informed
One of the big risks associated with vacation homes is buyer’s remorse. Though a vacation home seems like a fun idea at the start, it can quickly turn into a demanding strain for buyers. Your clients should also be aware of the large financial investment involved in vacation homes. According to Realtor.com, a typical “15- to 30-year mortgage for a non-owner-occupied property usually requires a 20% to 30% down payment.” Not only that, vacation home value appreciation is underperforming in the overall market throughout the country, save for the Midwest. Make sure you thoroughly explain what goes into a vacation home, how much money it will cost, and any other adverse reactions you might have seen with past buyers.
Appreciate Your Area
Certain areas of the United States survive on vacation home markets but where these areas are located might surprise you. Inman reported that Oklahoma City currently has the “highest share of non-owner occupied mortgages out of the 50 largest cities in the United States.” Other top cities include Memphis, Philadelphia, Miami, and San Francisco. If your town is not listed as one of the most popular vacation home destinations, don’t worry! Investors are attracted to various areas of the United States for different reasons; the West offers rapid appreciation and the South features affordability. As a real estate agent, you can help support your clients by knowing where the hottest markets are for vacation properties.