Just A SECOND
From the Council of Residential Specialists
Expensive Markets are forcing some first-time homebuyers to look outside their primary markets for their first home purchase ---a vacation home.
Availability of homes for first time homebuyers is failing to keep pace with the number of millennials looking to buy, according to a recent report from the National Association of REALTORS. That rift in the housing market has created a new phenomenon: first time home buyers investing in vacation homes outside the market they primarily live. For the more affordable homes that are on the market the inventory is so tight that its hard for first time home buyers to get into the market. Prices are rising rapidly in San Diego, and in many other markets, impacting who can buy a home. There is a lot of competition and a lot of demand for first time homebuyers.
For example, buyers who are gainfully employed in the San Francisco Bay area who have very high paying jobs, but still can’t afford to buy a place in one of the most expensive markets of the country are buying in the Lake Tahoe area. And even though the home isn’t a primary residence, it still qualifies the person for the same tax benefits as any new homeowner. As an added financial benefit, first-time home buyers in a vacation-home market maybe able to rent out the home as a short- or long-term vacation rental when they’re staying at their primary residence, covering the mortgage or earning money off the property. In San Diego, we’ve seen buyers being priced out of the market and investing in the mountains, like Big Bear or Mammoth or on the beach in Baja California.
Many millennials want to remain mobile—And with ease of communication via internet and cell phone, many people have the freedom to work for home, rather than being tied to an office. This allows them to purchase a secondary home to use more often than just on weekends.
For some, its all about the lifestyle—clearing your head of all the noise and pollution, high prices and too many people. “Peace of mind is worth its weight in gold these days”