Despite rising home prices and mortgage rates, second home investors have overtaken some groups in the vacation property market. This week, online marketplace Pacaso singled out counties in New Jersey, Florida and Massachusetts as key markets for luxury vacation home sales.
According to Pacaso’s report, the top 20 U.S. counties by overall luxury home sales are ranked by an index score determined by the ratio of secondary home sales to primary home sales in 2023 and 2024. It became clear that The list does not include counties with fewer than 50 home sales. Lock the mortgage rate for your second home. The average price for all counties on the list is over $700,000, with further growth expected.
The number one market is Cape May County, New Jersey. Gulf County, Florida, follows. Walton County, Florida. Barnstable County, Massachusetts. and Collier County, Florida.
“The destinations on this year’s list really capture the breadth of the luxury vacation home market,” Pacaso co-founder and CEO Austin Allison said in a statement. “Traditional destinations remain timeless as ever, with Florida’s Panhandle cementing its place as a vacationer favorite and Manhattan making a comeback as a place for buyers to double down on their second home investment. We are in the process of doing so.
“These are no longer just weekend getaways, but lifestyle investments for people looking to create endless treasured memories with friends and family.”
Allison went on to point out that mortgage rates are starting to ease, purchase mortgage applications are at their highest level since January, and increased inventory is driving the increase in transactions.
“There are strong signs that demand for both primary and secondary housing will continue to grow through 2025,” he said.
Top-ranked Cape May County boasted a 150% ratio of secondary residences to primary residences. The average price of a second home there was about $1.1 million. New Jersey’s southernmost county has soared in popularity, moving up from last place on Pacaso’s list of the top 15 second-home markets in May 2023. On the other hand, New Jersey has been one of the leading states for home equity growth, which may have put buyers in a better position. A position that allows you to invest in luxury real estate.
Florida had three counties in the top five second home markets in 2024. Gulf County in the Sunshine State took second place with a ratio of second homes to primary homes at 77.7%. Walton County is next in third place with 67%. The average price for a second home in Gulf County is just over $1 million, compared to about $1.44 million in Walton County.
Collier County, Florida was the No. 5 market on the Pacaso list. The secondary to primary home ratio is 52.9% and the average sales price is approximately $896,000.
The report also highlights the resurgence of investors buying luxury homes in New York County (Manhattan) post-pandemic.
Pacaso’s marketplace revolutionizes shared ownership of real estate by listing vacation home ownership opportunities for multiple parties. In a recent interview on the podcast “Real Estate Insiders Unfiltered,” Allison spoke highly of the potential of co-ownership in the luxury space.
“Co-ownership of luxury villas is becoming second home co-ownership,” he said. “Rather than eight people buying a median-priced home in a second-home community, eight people sharing a luxury home creates additional opportunities for the local workforce.”
