Purchases of vacation homes with high flood, storm and/or heat risk surged over the past two years
Many pandemic homebuyers purchased vacation homes, which are frequently vulnerable to natural disasters. In 2020 and 2021, purchases of second homes with high flood risk rose 45% from the prior two-year period (2018-2019), according to ClimateCheck data and public housing records. There were also significant increases in purchases of second homes with high storm risk (40%) and high heat risk (39%). Warm weather and proximity to the beach over-ride avoiding natural-disaster risk for vacation/second home buyers. Miami and Tampa Bay are the top second home markets in the United States.
Mortgage Rates Drop
Over the last two weeks, the 30-year fixed-rate mortgage dropped by half a percent, as concerns about a potential recession continue to rise. While the drop provides minor relief to buyers, the housing market will continue to normalize if home price growth materially slows due to the combination of low housing affordability and an expected economic slowdown.
