Vacation Home Market Surges

Sales of vacation homes were up 10.1% last year, accounting for 11% of all home sales, according to the National Association of Realtors. The surge in demand helped lift median vacation home prices by 24% year over year to $150,000.

Granted that much of this increase was the result of the tremendous interest investors have had in distress sales in hot markets in Arizona, Las Vegas, and Florida which they have turned in to profitable rentals.

In addition, though, there has been an increase in people buying vacation homes for their own personal use.

Since Maui is one of the most sought after vacation destinations in the world, we have also been the beneficiary of this increased interest in vacation homes.

As the inventories have been dropping and demand remains strong, weâ€™ve seen some upward pressure on prices during the last year. So long as the job situation continues to improve along with overall confidence in the economy, we see no reason why this trend wonâ€™t continue on.

The Hawaii real estate market has historically followed the West Coast market, especially California with a 6 to 12 month lag. Given the reports we see coming out of many areas of California, we suspect our market may rise even faster in the near future.

Aloha,

Ken

P.S. – One of the really fun events that happens each year is the Kapalua Wine & Food Festival happening from June 7th to 9th.