Vacation Home Sales and Prices Tumble

[marmar]

from Bloomberg:



Vacation Home Sales and Prices Tumble as Buyers Wait (Update3)

By Sharon L. Lynch and Kathleen M. Howley

March 28 (Bloomberg) -- Vacation home sales in the U.S. tumbled 31 percent last year and real estate bought for speculation dropped 18 percent as mortgage lenders tightened standards, the National Association of Realtors said.

Sales dropped to 740,000 from a record 1.07 million in 2006, the Chicago-based Realtors said in a report today. Sales of investment properties, which typically are resold without the buyers ever living in them, fell to 1.35 million from 1.65 million a year earlier.

Even as Baby Boomers, the 76 million Americans born between 1946 and 1964, approach their peak earning years they are holding back on purchasing a vacation home as the U.S. real estate slump enters its third year. About 55 percent of U.S. banks tightened underwriting standards on prime mortgages in 2007's fourth quarter, according to the Federal Reserve Senior Loan Officer Survey, published in January.

``Some buyers simply adopted a wait-and-see attitude,'' Lawrence Yun, the Realtor's chief economist, said in the report.

The median price of a vacation home was $195,000 in 2007, down 2.5 percent from $200,000 a year earlier, the report said. The price of an investment property was $150,000, unchanged from 2006.

Banks trying to rebuild their balance sheets are raising borrowing costs for nearly all would-be homebuyers, particularly those who are looking for second properties. .....(more)

The complete piece is at: http://www.bloomberg.com/apps/news?pid=20601068&sid=ajnLhO1KBtms&refer=home

[enid602]

1. odd

That's odd; you'd think that a lot of boomers would be retiring in vacation areas, especially those nearer to major cities where their children might live.