The pandemic (and low interest rates) are not only stirring up demand for primary residences, but a new analysis illustrates how much demand for vacation homes has shot up as well.
Eighty-four percent more mortgage applications were filed for second homes in January 2021 than in January 2020, according to a new Redfin report, making it the eighth month in a row that these applications grew by at least 80%. Second home application growth peaked in September with a 118% jump year-over-year.
Growth in mortgage applications for second homes also outpaced growth for applications on primary residences, for which mortgage applications were up 36% year-over-year in January.
The analysis notes that this disproportionate demand likely has a lot to do with how skewed the fallout from the current economic crisis has been, as the wealthy are able to take advantage of remote work and most low-income people are unable to make their housing payments, much less purchase a primary residence.
This study uses mortgage rate lock data, or when prospective buyers lock in an interest rate with their lender; 80% of rate locks lead to finalized purchases.
This article originally published at https://dc.urbanturf.com/articles/blog/demand-for-second-homes-grew-more-than-80-for-the-eighth-month-in-a-row/17861.
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