The number of buyers of a second home soared 128 percent year-over-year in March, according to a Redfin report, compared with a 34 percent year-over-year gain for primary homes. That’s the 10th straight month of at least 80 percent annual growth for second-home purchases.
Redfin notes the data should be taken in context because demand for second homes was relatively weak in March 2020, when the pandemic first hit and real estate activity in many parts of the country halted with lockdowns. The demand for second homes spiked as many affluent remote workers spend some of their time working from vacation destinations.
“The Palm Springs housing market is incredibly busy, with an influx of vacation-home buyers from Los Angeles and San Francisco,” Redfin agent Nisa Sheikh said in a release. “Many of them are tech workers who can do their jobs remotely, and they enjoy the weather and lifestyle here in the desert. People don’t want to vacation in a hotel room right now.”
The surging interest in vacation homes highlights the uneven financial recovery taking place throughout the country, Redfin Chief Economist Daryl Fairweather said.
“This recession has driven wealthy and low-income Americans further and further apart, and the soaring demand for vacation homes during the pandemic is a perfect example of their unequal financial footing, with some people buying second homes and others unable to buy their first,” Fairweather said. “Home prices just keep going up. That’s a good thing for Americans who already own one home because they can take advantage of their increased equity to buy other assets, which in some cases includes another home. But it’s bad for lower- and middle-class families, particularly those who are renters, because the barrier to homeownership is getting higher and higher.”