{"id":73295,"date":"2021-10-20T05:00:57","date_gmt":"2021-10-20T12:00:57","guid":{"rendered":"https:\/\/www.redfin.com\/news\/?p=73295"},"modified":"2021-10-19T15:27:40","modified_gmt":"2021-10-19T22:27:40","slug":"vacation-homes-september-2021","status":"publish","type":"post","link":"https:\/\/www.redfin.com\/news\/vacation-homes-september-2021\/","title":{"rendered":"Second-Home Demand Jumps in September, Bouncing Back After Summer Slowdown"},"content":{"rendered":"<h2><i><span style=\"font-weight: 400;\">Demand for second homes was up 60% from pre-pandemic levels in September, an uptick from July\u2019s 40% increase but still below March\u2019s record growth.<\/span><\/i><\/h2>\n<p><span style=\"font-weight: 400;\">In September, demand for second homes was 60% higher than it was before the coronavirus pandemic hit. While that\u2019s a slowdown from the record 112% surge we saw in March, it\u2019s an acceleration from July\u2019s 40% gain.<\/span><\/p>\n<p><img fetchpriority=\"high\" decoding=\"async\" class=\"alignnone size-full wp-image-73296\" src=\"https:\/\/www.redfin.com\/news\/wp-content\/uploads\/2021\/10\/second-home-sept-chart.png\" alt=\"\" width=\"1300\" height=\"899\" srcset=\"https:\/\/www.redfin.com\/news\/wp-content\/uploads\/2021\/10\/second-home-sept-chart.png 1300w, https:\/\/www.redfin.com\/news\/wp-content\/uploads\/2021\/10\/second-home-sept-chart-300x207.png 300w, https:\/\/www.redfin.com\/news\/wp-content\/uploads\/2021\/10\/second-home-sept-chart-1024x708.png 1024w, https:\/\/www.redfin.com\/news\/wp-content\/uploads\/2021\/10\/second-home-sept-chart-768x531.png 768w\" sizes=\"(max-width: 1300px) 100vw, 1300px\" \/><\/p>\n<p><span style=\"font-weight: 400;\">That\u2019s according to a Redfin analysis of mortgage-rate lock data from real estate analytics firm <\/span><a href=\"https:\/\/www2.optimalblue.com\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Optimal Blue<\/span><\/a><span style=\"font-weight: 400;\">. Redfin created a seasonally-adjusted index of Optimal Blue\u2019s data in order to adjust for typical seasonal patterns and allow for simple comparisons of second-home demand during and before the pandemic. We define \u201cpre-pandemic\u201d as January and February 2020 and set the index for that period to 100. Any data point above 100 represents second-home demand that\u2019s above pre-pandemic levels and any data point below 100 represents demand below pre-pandemic levels. This data is subject to revision.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">A mortgage-rate lock is an agreement between a homebuyer and a lender that allows the homebuyer to lock in an interest rate on a mortgage for a certain period of time, offering protection against future interest-rate hikes. Homebuyers must specify whether they are applying to secure a mortgage rate for a primary home, a second home or an investment property. Roughly <\/span><a href=\"https:\/\/f.hubspotusercontent10.net\/hubfs\/4225469\/Daily-Briefing-Files\/111720-Daily-Market-Briefing.pdf?utm_campaign=DAILY%20BRIEFING%3A%20Mortgage%20Market%20Trends%20%26%20Rate%20Activity&amp;utm_medium=email&amp;_hsenc=p2ANqtz-_rJREAU041O7dLTCSSszK8thVgx5ZLbxG5gUSP3Lze1YmGVqPGf8qFS1a_J4OJT6bE92hQ0usjKIeSlZ79_9_KNdN5HA&amp;_hsmi=100118857&amp;utm_content=100118857&amp;utm_source=hs_email&amp;hsCtaTracking=dd6feab3-8164-4576-9814-7d1dcdea398c%7C32e55f2c-05c3-4f18-acdf-e0fec0b66c48\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">80%<\/span><\/a><span style=\"font-weight: 400;\"> of mortgage-rate locks result in actual home purchases.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The popularity of vacation homes skyrocketed at the onset of the coronavirus pandemic, with many well-off Americans opting to leave city-life behind and work remotely. But the surge in demand for second homes started to slow as cities lifted stay-at-home restrictions, the initial shock of the pandemic faded, spring homebuying season ended and the overall housing market began to cool.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">A new rule from Fannie Mae probably also contributed to the slowdown in vacation-home demand, according to Redfin Deputy Chief Economist <\/span><a href=\"https:\/\/www.redfin.com\/news\/author\/taylormarr\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Taylor Marr<\/span><\/a><span style=\"font-weight: 400;\">. The government sponsored mortgage enterprise announced plans in March to <\/span><a href=\"https:\/\/www.forbes.com\/sites\/forbesrealestatecouncil\/2021\/05\/17\/what-we-know-about-changes-to-lending-rules-and-how-real-estate-professionals-should-prepare\/?sh=1f68f50464bc\"><span style=\"font-weight: 400;\">limit<\/span><\/a><span style=\"font-weight: 400;\"> the number of second-home and investment-property loans it would buy, effectively making it more challenging and expensive for some buyers to take out mortgages on vacation homes.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">\u201cThe market may have overreacted to the Fannie Mae rule a bit, which would explain why we\u2019ve been seeing demand for second homes bounce back,\u201d Marr said. \u201cMortgage <\/span><a href=\"http:\/\/www.freddiemac.com\/pmms\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">rates<\/span><\/a><span style=\"font-weight: 400;\"> are on the rise as well, which is likely creating a renewed sense of urgency for vacation-home buyers who want to purchase properties before rates climb even further.\u201d<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In the middle of last month, the Treasury Department and Federal Housing Finance Agency announced that they would <\/span><a href=\"https:\/\/www.housingwire.com\/articles\/treasury-fhfa-suspend-recent-pspa-requirements\/\" target=\"_blank\" rel=\"noopener\"><i><span style=\"font-weight: 400;\">remove<\/span><\/i><\/a><span style=\"font-weight: 400;\"> the aforementioned restrictions on Fannie Mae in an effort to boost housing supply. This will likely help keep demand for second homes above pre-pandemic levels for the foreseeable future, Marr said.\u00a0<\/span><span style=\"font-weight: 400;\">Permanent remote work policies may also fuel sustained interest in second homes. Amazon.com Inc. earlier this month <\/span><a href=\"https:\/\/time.com\/6105905\/amazon-work-from-home-policy\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">said<\/span><\/a><span style=\"font-weight: 400;\"> it will allow many employees to work from home indefinitely, following in the footsteps of other major corporations that have <\/span><a href=\"https:\/\/www.cnbc.com\/2021\/10\/01\/pwc-says-us-employees-can-work-from-anywhere-in-the-country.html\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">recently<\/span><\/a><span style=\"font-weight: 400;\"> made similar announcements.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Demand for second homes was up 60% from pre-pandemic levels in September, an uptick from July\u2019s 40% increase but still below March\u2019s record growth. In September, demand for second homes was 60% higher than it was before the coronavirus pandemic hit. While that\u2019s a slowdown from the record 112% surge we saw in March, it\u2019s [&hellip;]<\/p>\n","protected":false},"author":13346,"featured_media":73297,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"site-sidebar-layout":"default","site-content-layout":"default","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"default","adv-header-id-meta":"","stick-header-meta":"default","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center 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