According to data from the real estate agency Redfin, the number of homebuyers who locked in mortgage rates to acquire a second home fell for the first time since the COVID-19 outbreak began (NASDAQ: RDFN).
What Happened: Demand for second houses fell 11.1 percent year over year last month, the first drop since April 2020 and a sharp reversal after a year of double- and triple-digit rises in second home mortgage locks.
“As many people return to the workplace this summer, demand for second homes is dwindling,” said Taylor Marr, Redfin’s head economist. “With increasing prices and tougher lending rules for second houses, homebuyer demand is shifting in favor of primary residences.”
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What Else Occurred: Despite the lower demand, housing prices in the seasonal areas where second homes are common were up 28% year over year in June to $468,000. This was the twelfth month in a row that annualized price rise for homes in these markets above 10%.
Home prices in non-seasonal towns, on the other hand, increased by 26% to $421,000 in June, closing the price disparity between seasonal and non-seasonal towns.
Last September, the biggest disparity between the two markets emerged, with seasonal towns’ prices rising 22 percent year over year versus 13 percent for non-seasonal towns.
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