flyfishing

As we’ve stated in previous articles, Americans are purchasing vacation real estate, second homes and recreational property at a more rapid rate than in recent years. From Minnesota to Southern Florida, Americans are once again pursuing vacation property while the conditions are right. Several market factors can help explain this strong demand and trends point to a continued increase in discretionary real estate spending in the near future. We know a mix of growth in equity markets, pent-up demand, stronger consumer confidence in the real estate market, stronger consumer personal financial health, historically low mortgage rates and more realistic pricing have driven this resurgence in vacation real estate purchases, but who is buying this property?

According to a recent National Association of Realtors survey, the following information describes these vacation or second-home buyers:

  • Their average age is 43 years old
  • Their median household income was $85,600
  • 33% said they were likely to purchase another vacation home within two years
  • More than 8 out of 10 second-home buyers said it was a good time to buy

At United Country Real Estate, we sell more vacation and other non-urban lifestyle real estate nationwide than any other real estate company and we are definitely seeing these trends in secondary real estate purchases. In addition to vacation real estate, recreational land has been showing steady growth from the end of 2013 to present. Our analysts have been tracking similar statistics to the NAR report about who is buying these properties, but we have spotted unique characteristics of the recreational property buyer. Our recreational real estate buyers are typically cash buyers and able to put down more than 30% on these transactions or pay 100% cash. That said, United Country Real Estate has a strategic partnership with one of the strongest land finance groups in the U.S., and has also been able to help more buyers secure land and second-home financing if needed.

Additionally, auctions  play a large part in real estate transactions in the rural areas of America, and recreational property is no exception.

“Using the blended model of auctions and traditional real estate services gives us a marketing advantage that other brokerages simply can’t offer,” said Mike Jones, president of United Country Auction Services. “This process provides an incredibly transparent transaction, which when properly marketed, reveals the true market value of a property. Being able to leverage both traditional and auction marketing methods gives our national network of brokers, agents and auctioneers the competitive edge needed in today’s ever-changing vacation, second home, recreational and land marketplace.”

As the leader since 1925 in lifestyle, small city and town, country and lifestyle real estate nationwide, United Country Real Estate is predicting continued stability, strength and growth in non-urban real estate.  These markets were more stable during the recession and have rebounded strongly over the last few years. Stop by our office and we can discuss what trends we are seeing in the property you own or are interested in considering in the future.

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Vacation Property Selling Again

by admin on June 5, 2014

beach house

Discretionary spending all but vanished during the “Great Recession” for the previous decade, but key indicators show that Americans are returning to vacation properties as an investment and a place to enjoy.  Many consumers have spent the last few years getting their credit back in order and rebuilding their financial health, and most are seeing a more stable economy, so with low interest rates and reasonable prices, once again consumers can pursue vacation, second home and recreational property.

According to a recent report by the National Realtors Association, vacation home sales accounted for nearly 15% of all transactions last year, their highest market share since 2006. This was a 30% increase versus the two previous years. “If trends continue, there will be an increase in vacation home sales {again} this year,” stated Joanne Cleaver in a Money – US News April report.

United Country’s sales data mirrors these results. “We are seeing great things in the recreational land market this year,” said Jason Cole, chief financial officer with United Country Real Estate. “Over 2012 and 2013, there has been a double digit jump in recreational land sales volume.  And that trend is continuing in our markets nationwide into 2014.”

Having a vacation, second home or recreational property gives property owners their own personal getaway to visit whenever they are able. Additionally, these properties can be income producing with rental opportunities, leasing, carbon credits, CRP (crop payment programs), farming or business opportunities, retirement potential and provide additional equity growth through price appreciation over time.

A recent NAR survey reported the following interesting vacation property insights;

  • The typical vacation home buyer is 40+ years old and higher income ($85,000+)
  • Vacation properties were on average 305 miles from their primary residencies. 35% were within 100 miles and 37% were more than 500 miles from home.
  • 91% of vacation home buyers planned on renting their properties at least some amount during the year.

For those seeking a second home, vacation or recreational land, we suggest:

  • Shopping around. It’s tempting to buy a second home or property in a vacation spot that you fell in love with, but you could be missing out on even better spots or better deals elsewhere. Look around in different locations that offer the same lifestyle to see if something better is available before purchasing a second home or property.
  • Planning on owning it for a while. In order to make your purchase a good investment, plan on owning it for at least five years. Make sure you buy a home or property in an area that you’ll be able to get to several times throughout the year.
  • Considering how insurance costs factor into your budget. Second homes can cost quite a bit in insurance if you need coverage for wind or flood damage, such as in hurricane-prone areas.
  • Buying at the right time.  Seasonal demand drives destination home and property prices, so be sure to analyze changes in sale prices at the same point in each year, or “off season”.
  • Getting your financing lined-up first.  Financing vacation homes, second homes and recreational property can be especially challenging in this post-recession era of stringent lending standards, that said, 38% percent of vacation homebuyers paid for their vacation properties with cash. It’s the norm for buyers who do need financing to work with their bank or lending source first so they approach the vacation market with a preapproval in hand. If your goal is to buy the property and quickly pay it off to enter retirement mortgage-free, work out several fallback financial scenarios so you have a backup plan. If purchasing, your United Country agent can often help you find financing solutions through United Country land and mortgage lending partners.

Once found though, vacation, second home and recreational properties can provide a lifetime of memories for you and your family.  They provide a common destination to escape from the hustle of everyday life offering a laid-back option, lifestyle activities and new adventures. As the nation’s largest seller of lifestyle and non-urban real estate, United Country can help you “Find Your Freedom”, or market a vacation, second home or recreational property you would like to sell to a broader, regional and nationwide audience and find someone who will value it as much as you have.

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Real Estate Auction Industry: The Rise of a New Era

June 5, 2014

Over the last decade big things have been changing in real estate sales and the biggest change … the auction market. For a long time, the auction industry was primarily considered a fix to relieve the market of distressed or unwanted properties. This is no longer the case and as a real estate owner, you […]

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Now is the Time to Invest in Non-Urban Real Estate

June 5, 2014

A recent Gallup poll found that Americans realize real estate is the best long-term investment. With mortgage rates at record low rates and reasonable prices in the non-urban sectors of the nation, now is the ideal time to look for an investment that can appreciate in value over time, produce income and uniquely gives you […]

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Why use a Land Agent or Auctioneer to Sell your Land

February 5, 2014

A landowner has the option to sell their land on their own or use a real estate agent or auctioneer. Many times a landowner has been approached by an adjoining neighbor or acquaintance that is familiar with the property and told if they ever wanted to sell, the neighbor or acquaintance would purchase the land. […]

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Real Estate Trends and 2014 Outlook

February 5, 2014

Both residential and land sales showed strong growth and stability in 2013. Pent up demand, much improved consumer financial health, rising rents, low mortgage rates improving economic conditions and increased confidence in residential property as an investment all point toward an optimistic look at the real estate market outlook for 2014. Most industry leaders agree […]

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Farmland Values Hold Their Value, Hit More Highs in Multiple States

February 5, 2014

With the continued growing demand for food crops both here and across the world, farmland in the U.S. ended 2013 holding excellent value again. This fertile asset has not only realized amazing growth in value over the recent years and held that value, but again has shown increased price appreciation in multiple states including Iowa, […]

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Housing Remains Best Investment by Gaining Traction in 2013

February 5, 2014

Housing prices continued to strengthen in December rounding out a year of recovery in 2013. CNN reported on the S&P/Case-Shiller home price index, which showed a 13.6% increase in housing prices nationwide. United Country reported strong increases in nationwide homes in the smaller cities, towns and surrounding, non-urban, market they service in 2013 as well, […]

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Rural Housing, Land Market is on Fire

December 13, 2013

The housing market is looking up nationally and especially in the non-urban regions. CNBC reported a 25.4 percent increase in sales during the month of October. At United Country, we saw a 26.9% increase in October home sales versus 2012 and the numbers keep climbing. In November, we saw an impressive increase of 37.8%  in […]

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Jimmie Dean Coffey Named New Director of Business Development, Area Vice President

November 7, 2013

Congratulations to Jimmie Dean Coffey of United Country Coffey Realty & Auction on his two new roles within the United Country team! To learn more about this story, read the news release here.

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