New niches emerge in PA’s second-home market
REALTOR® and Resort and Second-Home Property Specialist (RSPS) instructor Melanie McLane said, “The second home market is totally discretionary so a lot of people are hunkering down and waiting a little nervously to see what will happen with the economy.”
McLane, who will be teaching a Resort and Second Home Market designation course at the NAR Convention in November, says much of second home/resort home varies from market to market. “I think this market has also seen that people have to change their attitudes about second homes and they can’t buy expecting double digit increases in the value of their property,” she said.
The National Association of REALTORS®’ (NAR) research shows vacation-home sales rose 7.9 percent to 553,000 in 2009 while investment-home sales fell 15.9 percent to 940,000 in 2009. Half of the vacation homes purchased was in the South, 21 percent in the West, 17 percent in the Midwest and 12 percent in the Northeast.
Jerry Romanik with Realty Executives, Summit, in the Pocono Mountains region agrees with McLane’s observations. “There’s so much uncertainty and many consumers seem to be waiting to see what will happen next. We have a great inventory right now and it’s really a buyer’s market although many are looking for short sales and foreclosure properties,” he added.
Winter sports draw clients to both the Pocono region and the mountains in Western Pennsylvania. Adrienne “Abe” Wagner of Prudential Preferred Realty, Donegal, sees clients cautiously returning to the market and those she’s seeing are split at either the low or high end of the price range.
Wagner, who sells resort properties with her husband, Robert “Wags” Wagner, said typically properties in the $200,000 to $300,000 are the mainstay of their business but now the under $200,000 and over $500,000 properties are selling more quickly. They’re also seeing far more cash buyers because the financing for second home market has become more difficult. Nationally, the median transaction of a vacation home was $169,000 in 2009, according to NAR.
A trend that both Wagner and Jim McLane with Fish Real Estate in Jersey Shore have noticed is an increased interest in properties near bike trails.
The Great Allegheny Passage connects with the C&O Canal Towpath so bikers can trek 320 miles from Pittsburgh to Washington, D.C. Properties near these bike trails are selling more than waterfront properties. “It’s a different slant. A different niche is evolving and it’s exciting to see something new being developed,” Wagner said.
Jim McLane said the Rails to Trails have been a draw to clients in his region as well. He said USA Today recently ranked the Pine Creek Valley trail the 8th best in the world. He said area businesses are just beginning to cater to this new clientele and he believes it has great potential for future growth.
He said sales of second properties in his region are on the rise this year. “It looks like we’ve turned the corner,” he added. McLane said his market in central Pennsylvania is primarily recreational homes and cabins used for family getaways, hunters, fishermen and Penn State football fans.
Melanie McLane added, “There are still many people with the money to afford a second property. They need to recognize that this is a gathering spot for their family, a place to vacation, not a place that they’ll see huge returns on their investment.”