Fannie Mae reports that second home buyers “tend to be older, have higher incomes, and put larger down payments on their second homes than primary residence buyers.”
We hope you were holding on to something when you read those truly and deeply shocking revelations. There is little comfort in the fact that certain homebuyers are not getting any younger, or no less predictable.
The information comes from Fannie Mae’s latest Housing Insights, which focuses on the second home buyer. “A typical second home buyer is 47 years old, comes from a two-earner household, and finances the purchase of the home 61% of the time,” the report states.
In another revelation, the report states that the secondary home market grew significantly during the housing boom but that growth ceased following the housing bust.
Readers of HousingWire will already know that vacation home sales were up nearly 30% in 2013. To bad you can’t count on second-time homebuyers to do anything but predictably buy a second home.
The report holds other information like the fact that second home buyers still tend to buy in warmer climates.
Yes, we knew that, and the states they pick also never seem to change.
“Since January 1998, 34% of all second home mortgages originated on properties located in Florida, California and Arizona,” Fannie’s report states.
And even though those states experienced home price volatility, with home prices decreases of 40% or higher in each state from 2006-2012, it hasn’t dampened buyers’ interest in those states.
C’mon, there is a condo in Alaska with your name on it. Any takers?
With second home buyers typically being wealthier, they are more prone to buy in cash. “The recovery in financial markets has allowed many second home buyers, who are typically older and more likely to own financial assets, to sell some of their assets to buy second homes or use dividend payments from these assets to cover second home mortgage expenses,” Fannie report states.
The report also predicts that an aging population could lead to an increase in second home sales in the future. “As the population continues to age, we expect people to continue to use their savings to buy second homes, thereby contributing to a segment of the mortgage market that will continue to grow in the years to come,” the report says.
Now as long as your jaw is still attached to your head, get busy getting older so you can buy that second home you’ve always wanted.
Florida is waiting! And don’t worry, it won’t change.