South Tahoe second-home buyers aren’t in a hurry
July 2, 2010
SOUTH LAKE TAHOE, Calif. – About 65 percent of South Lake Tahoe Homes are second homes or vacation properties.
I often write about, or use the phrase second home buyer characteristics, which makes sense. South Lake Tahoe is very much a second home resort real estate market.
Some 65 percent of area homeowners live elsewhere. This means that about a third of South Lake Tahoe homes are primary residences.
The National Association of Realtors did a specific study on vacation or second home buyers. I thought it would be of interest to look at the most recent findings.
Before looking at the particulars, there are a few key characteristics of the vacation and second home buyer to always have in mind. These are important, especially as it relates to style and manner when representing a buyer:
• The vacation or second home buyer lacks urgency.
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• The vacation or second home buyer is overqualified financially.
• The vacation or second home buyer is looking for a family retreat.
Of these, lack of urgency is really important to understand to best represent a buyer. What I like to do is “mirror” a buyers pace if I can. If a buyer seems to want to move quickly, I quicken my pace. If the buyer moves slowly, I respond in kind.
Sometimes, though, a particular house or situation does require urgency. An underpriced house, or one that is right priced and exceptionally attractive can require immediate action to get it.
n cases such as this, I do recommend that the vacation or second home buyer move as quickly as they possibly can.
If I ever quicken my pace, it is because I don’t want a buyer to miss out on something they obviously really like. I am never in a hurry just to make a sale. Buyer comfort to me is king.
Sales and prices:
• Some 10 percent of U.S. home sales were vacation or second home properties.
• 1 percent more vacation or second homes sold in 2009 compared to 2008.
• The median age of the vacation or second home buyer in 2009 was 46 years of age.
• 28 percent of vacation orsecond home buyers were older than 55.
• The median household income of 2009 vacation or second home buyers was $87,500.
• 39 percent of vacation or second home buyers had a household income that exceeded $100,000.
• 73 percent of 2009 vacation or second home buyers were married.
• 49 percent of 2009 vacation or second home buyer households had no children younger than 8.
• 86 percent of 2009 vacation or second home buyers were Caucasian.
• 55 percent of 2009 vacation home sales were in a small town or rural area.
• 50 percent of 2009 vacation home sales were in the South.
• 71 percent of 2009 vacation or second home sales were single-family homes.
74 percent of 2009 vacation or second home sales were existing properties (not new).
• The median distance away from primary residence was 348 miles.
Method of Purchase and Financing:
• 54 percent of 2009 vacation or second home buyers used a real estate agent or broker.
• 10 percent of 2009 vacation or second home sales were a foreclosure or trustee sale.
• 27 percent of 2009 vacation or second home sales were directly from an owner (17 percent that buyer knew, 10 percent that buyer didn’t know).
• 32 percent of 2009 vacation or second home buyers looked first on the internet to shop for a home.
• 12 percent of 2009 vacation or second home buyers contacted a real estate agent first to shop for a home.
• 26 percent of 2009 vacation or second home buyers found the home they purchased on the internet.
• 25 percent of 2009 vacation or second home buyers found the home they purchased with a real estate agent.
• 70 percent of 2009 vacation or second home sales used a mortgage.
• Nine out of ten home buyers use the Internet in their home search process.
• Is our experience that buyers contact us after internet searching first.
• More often we find the home the buyer buys, rather than what they exactly saw on the Internet.
Buyer Motivations and Expectations:
• 89 percent purchased their vacation or second home as a family retreat.
• 29 percent purchased their second home because it was a “good investment” opportunity.
• 25 percent purchased their second home to rent to others.
• 14 percent purchased their second home for tax benefits.
• 26 percent purchased their second home as a future primary residence.
• 80 percent purchased their second home because they believe now is a good time to purchase.