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Is it Time to Sell Your Vacation Home?

Is it Time to Sell Your Vacation Home? | MyKCM

The travel industry is one of the major sectors that’s been hit extremely hard by the COVID-19 pandemic. Today, it’s hard to know how long it will take for summer travelers to be back in action and for the industry to fully recover. Homeowners who rent their secondary properties on their own or through programs like Airbnb, which has over 660,000 listings in the U.S. alone, have been impacted in this challenging time. Some of these homeowners are considering selling their vacation homes, and understandably so.

A recent CNN article indicated:

“With global travel screeching to a halt during the pandemic, a number of Airbnb hosts are planning to sell their properties…These desperate moves come as hosts face the possibility of losing thousands of dollars a month in canceled bookings while bills, maintenance costs, and mortgage payments pile up.”

If you’re one of the property owners in this position, you too may be feeling the pain of decreased travel, especially as we prepare for the typical busy summer vacation season. A recent survey notes that 48% of Americans have already canceled summer travel plans due to the current health crisis. In addition, 36% indicated they don’t have vacation plans, and only 16% said they did not cancel their summer travel.

The same survey also asked, “How long will you wait before traveling again?” Not surprisingly, only 29% of respondents are planning to travel within the next 6 months. That means 71% are putting their plans on hold for at least 6 months, or are still unsure about future travel. That can continue to add to the significant income loss that many property renters felt this spring.Is it Time to Sell Your Vacation Home? | MyKCMIf you’re considering selling your rental property, know that there are two key factors indicating that selling your vacation home now may be your best move as a homeowner.

1. Inventory Shortage

The inventory of overall homes for sale is well below the demand from potential buyers, so many eyes may be searching for a home like yours. According to the National Association of Realtors (NAR), total housing inventory, meaning homes available to purchase, is down 19.7% from one year ago (see graph below):Is it Time to Sell Your Vacation Home? | MyKCMInventory across the country continues to be a challenge, with only a 4.1-month supply of listings available at the current sales pace. For a balanced market, where there are enough homes available for interested buyers to purchase, that number would need to bump up to a 6-month supply. This means we don’t have enough inventory for the number of buyers looking for homes, so selling in this scenario is ideal. Buyers are looking now, and some vacation homes make a great primary residence or second home for those eager to escape from more populated urban areas.

2. Home Prices

The lack of inventory is also keeping homes from depreciating in value. Today, prices are holding strong and experts forecast home price appreciation to continue throughout this year. Selling your home while prices are holding steady is a sound business move. You’ll likely have equity you’ve earned working for you as well. If your home has been vacant for the past few months, the forced savings you have built in your equity may help balance out possible rental income loss due to the slowdown in the travel industry.

Bottom Line

We don’t know exactly when heightened summer travel will return or what it will look like when it does. If you’re considering selling your vacation home, let’s connect today to determine your options in the current market.

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Jean Becklund is a Luxury Real Estate Agent for EXP Realty. Jean has been living on Maui the past 36 years and has been a licensed real estate agent the past 16 years. Her knowledge of the market is vast. She does not limit her self to one area, she is familiar with resort properties, residential, vacant land, and the process it takes to build a home on Maui. Jean has had first hand experience she bought her first home in 1995 in Maui, owned 3 rental condo's, and designed and built a plantation home in 2005 where she resides today. Jean is the mother to 2 daughters Hayley who is her Broker and business partner and Chloe who is a waitress. Jean's sister Maureen used to tell her of the gentle rain and rainbows when she came to visit in the 1970's, that never left her mind. She moved to Maui in 1987 with a one way ticket and a set of golf clubs, landed her first job at Makena Golf Course and worked in the pro shop. Looking back those were the most precious days in Maui, a simple quiet life. Jean still heads back to Makena for her early morning swims. She loves to golf and joined the hole in 1 club in 2010. She plays pickleball daily, snorkels for sea shells and beach glass, rides her bike and plays her ukulele. Jean is also a pet lover with 1 senior dog and 5 cats. Jean loves her island lifestyle and would love to share her knowledge with you. She has a magnetic smile and infectious laugh, call her today!

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