New report shows demand fueled by low mortgage rates and remote work
Demand for vacation homes increased significantly from pre-pandemic levels in December, according to new data from Redfin.
Figures from the analytics firm based on an analysis of mortgage-rate lock data revealed that vacation home demand was up 77% in December – slightly below the 80% increase in November and the record 92% gain in January, but up significantly from the 2021 low hit in August.
Read more: What’s driving up demand for second homes?
According to Redfin, interest in second homes started to surge in mid-2020 as affluent Americans dispatched to vacation destinations, taking advantage of low mortgage rates and remote work.
“The slight slowdown in mortgage-rate locks from November to December is likely an effect of the holiday season and not indicative of dampening demand,” Redfin said in a statement.
“The wealthy are still flush with cash and have access to cheap debt, which is why second home purchases remain far above pre-pandemic levels,” said Daryl Fairweather, chief economist at Redfin. “While interest in second homes is stabilizing after the big boom in the second half of 2020 and the beginning of 2021, I expect demand to remain high well into this year. Remote work isn’t going anywhere, and mortgage rates are still quite low.”