Here’s the Jersey Shore’s Current Situation
The pressures of the pandemic have pushed American homeowners to leave their crowded cityscapes and look for more space. This surge in households interested in a vacation home retreat has real estate in cities along the Jersey Shore booming. Sales were up 25% this year, the median sales prices of single-family homes at the Shore have increased by 8% year-over-year, and the average price for a Jersey home is $100,000 more than it was last year — increases largely attributed to historically low mortgage rates and changes in home functionality needs as inspired by the pandemic.
Vacation Home Demographic
Interest in beach homes, or a second residence for wealthy city residents or landlocked suburbanites, is ramping up sales of beachfront properties in similar areas like Upstate New York and further north in Maine.
Per the Asbury Park Press, more than 25% of respondents to a Harris Poll taken in late April said they had considered moving to a less dense area in reaction to the coronavirus outbreak, though there are a number of reasons people are considering a vacation home. Most often, people either love to visit a certain area, they plan on retiring soon, or they’re hoping to generate rental income by purchasing a vacation home. Regardless, the most important factor in any vacation home, true to real estate, is its location.
To no surprise, the Baby Boomer demographic currently dominates the field as renters, buyers, and sellers regarding vacation properties. Leading up to 2007, retirees took over the market as working professionals were busy toiling at their nine-to-fives. With work flexibility becoming the new norm, millennials and younger generations are starting to explore renting and buying vacation homes while working remotely.
Jersey Shore’s Vacation Home Market
The Shore’s appeal of fewer crowds and less stress has made the purchasing decision easy for many buyers seeking to soak up the coastal sunshine. Many of these new residents have been visiting the region for years and know the area well, adding to the competitive nature of the market as so many fans wish to call the Shore home.
"There are definitely people who want out of the city because of the pandemic. There are also people looking to strike now to catch a deal," said T.R. Deveney, an agent with The Gallery Residential Brokerage in Wall Township.
Specifically, Deveney has been closing deals with New York buyers wanting to escape the cluster of NYC. He also mentioned that there's more demand for Shore real estate than there is available inventory. The Asbury Park Press states that “new listings are down by 31%. The median sales prices of single-family homes at the Shore are about 8% higher than last year. The median sale price for a single-family home in Monmouth County is $452,000; in Ocean County, it's $320,000...”
With so many new eyes looking for their next vacation home, shorely you don’t want to miss out on the potential profit boom.
Vacation Home Facts to Help Agents Break Into This Niche
Whether you’re interested in branching out into a new niche market or buying a vacation home for yourself, there are important decisions you should make before moving forward. Vacations require planning and logistics, and so will buying or selling a vacation home.
If you’re interested in getting into the vacation home market, consider pursuing NAR’s Resort and Second-Home Property Specialist Certification. It’s also important to know which locations are popular for investors right now so you can hone your marketing collateral and strategy appropriately:
- 34% purchased properties in a suburb or subdivision
- 33% purchased properties in a beach area
- 24% purchased properties in a small town
- 21% purchased properties on a lake
- 19% purchased properties in an urban area
- 15% purchased properties in a rural area
Selling a second home that may double as an investment requires a different skill set than selling a typical family home — primarily an in-depth knowledge of the tax implications that second homes carry. Additionally, clients looking to purchase a vacation home are more focused on the resale value, rental income, and taxes owed than they are on school zones and luxury kitchens. So, do your research, explore your local vacation market, and you’re shore to make a splash!
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