Following the 2008 economic downturn, the vacation home market was hard-hit, with home prices across the country dropping significantly. However, as the economy continues to improve, the vacation home market has also strengthened with many vacation homebuyers taking advantage of lower interest rates and substantial price markdowns. Certain cities in particular have emerged as some of the best places to buy a vacation home. If you’re in the market for a second home, consider the following locations which rank among the top spots to purchase a vacation getaway.
Sea Island, GA
Situated just off the southern coast of Georgia, SeaIsland consistently makes the list of top ten spots to buy a vacation home, according to Barron’s. In the late 1920’s, Sea Island became known as a popular luxury resort, with five miles of private beaches and a convenient location halfway between Jacksonville and Savannah. Surrounded by salt marshes, the island features Mediterranean-style architecture, an enormous spa and two championship golf courses. In 2009, the median asking price for a home on Sea Island was $3.3 million but in 2010, prices had dropped nearly 30 percent. Home prices rebounded in 2011, edging upwards slightly to a median of $2.5 million. However, according to Barron’s, some homeowners have continued to reduce their asking price in order to attract new buyers to the island.
If you’re interested in warm breezes and sandy beaches, the island of Maui may be what you’re looking for. In recent years, Maui has been touted as one of the best places to buy a vacation home by both Barron’s and the Wall Street Journal. The island, which boasts several vacation homes owned by celebrities including Oprah Winfrey and Charles Schwab, saw a significant dip in home prices with a median of $1.5 million in 2009. Since then, home prices have continued to rise, and as of 2011, the median hovered at $2.25 million. If you’re looking for ocean views, beautiful scenery and the chance to rub elbows with stars, Maui is considered to be one of the top choices. If Maui is slightly outside of your price range, you may consider heading over to Kauai, where the median home price in the Hanalei market is slightly over $750,000.
Traditionally considered a retreat for harried New Yorkers, the Hampton shave become an increasingly popular and affordable place to buy a vacation home. In the past five years, home prices in the Hamptons have dropped nearly 50 percent. According to the Wall Street Journal, the median home price was $680,000 in 2011, a steep decline from its previous high of $1.1 million. While home sales have begun to increase, potential buyers are still successfully offering on average 15 percent less than the asking price. While the beach front is still the favored location for many homebuyers, the best deals may be found for those who are willing to move further inland.
Martha’s Vineyard, MA
In recent years, Martha’s Vineyard has seen wave after wave of foreclosures which has caused the overall market to plunge. While waterfront properties continue to command asking prices ranging into the millions, inland home prices have seen a sharp decline. Reportedly, home prices have dropped as much as 35 percent since 2006. The island, which features everything from expansive mansions to quaint cottages, offers potential homebuyers a median asking price of approximately $403,000, according to the Wall Street Journal.
Aspen, Coloradohas become a hotspot for celebrities who prefer a colder climate to tropical breezes. With median home prices in the millions, Aspen may not be an affordable choice for the average buyer. Nearby Vail, however, offers many of the same features with a much lower price tag. According to the Wall Street Journal, the inventory of available homes has increased by approximately 40 percent and home prices have dropped significantly. In 2011, the median home price was just $385,000, nearly half the median price you might pay for a home in Aspen. If you’re ready to hit the slopes without busting your budget, Vail may be your dream vacation home destination.
Florida experienced some of the most significant fallout from the housing market crisis, reflected by a nearly 60 percent drop in home prices in the Miami area alone. In 2011, the median home price was just $130,000 although prices remain higher for homes in certain areas such as Canyon Ranch. While home sales have remained slow, it’s expected that the market could go even lower, making it appealing for those who are looking for a bargain. If you prefer a vacation condo versus a freestanding home, you may consider taking the hour and a half drive north to Palm Beach where home prices are still relatively low with a median of $254,000 in 2011.
Purchasing a vacation home requires a significant commitment of time and money. However, favorable market conditions may make it a more affordable option for some potential buyers. If you are thinking about buying a vacation home, give these cities a good hard look.