Second-home market a big economic driver
By Mary Miller Lee | March 25,2013
Not really a local resident or a tourist, the hybrid second-home owner is a powerful force in our local economy, especially if you are in the real estate business.
“The second-home owner market is crucial to the real estate business here: it is why we have our offices in Manchester, Stowe and Okemo,” said Nancy Perry, managing broker of Vermont Country Properties Sotheby’s International Realty. “It is where you have movement in the market.”
The numbers support the idea the second-home owner market is where the action is. Of the 2,186 residences in Manchester, just more than half — 55 percent — have homestead status, leaving a significant 45 percent of all residences owned by people who don’t consider these to be their primary homes, according to information provided by Pauline Moore, Manchester’s assessor and economic development coordinator.
A review of the property transfer documents for Manchester’s residential real estate closings in 2012 showed 63 percent of residential closings involved a second home, either as buyer or seller. Additionally, the closings involving second homes accounted for 78 percent of the total dollar sales for Manchester residential real estate transferred in 2012.
These numbers are accompanied by cautious optimism that the local real estate market is improving. “We are in the curve and just about to turn the corner,” said Perry. “Showings have picked up, and I have run into some multiple offers — something which has not happened in quite some time.”
Added Barbara Price, a broker at Lang McLaughry Real Estate: “The market has probably bottomed out, but we may not have cleared all the hurdles.” Price noted she is much busier now and showings are up, which indicates that interest is there; however, she added, “showings do not necessarily turn into sales.”
Who is the second-home owner? According to Perry, retirees used to be the prime prospects, but that’s no longer the case. “I am seeing more young families, people in their 40s and 50s, who are looking for a family retreat, ” said Perry. New Jersey, New York and Connecticut are the main states buyers come from as they seek a reasonable drive time to a second home.
The more popular features people are looking for include open floor plans combining living, eating and kitchen space; and updated kitchens and bathrooms. Granite surfaces and stainless steel appliances are also desirable.
“People want the house they want and are not as willing to remodel as they were in the past,” noted Perry. In terms of size, “they want decent-sized homes; mega-sized with mega-prices are much slower to move: they don’t want too much to take care of.” Sweeping views and privacy also are important, she said.
A home’s condition is also very important. “If the house is not up to standard, this is used by buyers to put pressure on the price,” noted Perry. She also said it has become more common for sellers to have professional appraisals and building inspections done prior to listing their properties.
What is the main concern of buyers? At the top of the list is getting a value for their money. They don’t want to overpay. Buyers today are a very educated and savvy group who are willing to do their homework to avoid overpaying.
“Over the past couple of years the most profound change we have seen in the real estate business is the use of the Internet by both buyers and sellers,” said Price. “Both are so much more educated due to all of the information so readily available to them.
“Our Web site is our most important marketing tool,” added Price, with 90 percent of its business via the Internet. Both real estate brokers stressed the importance of using photographs and videos to market a property.
Property taxes haven’t yet proven to be a significant barrier to buying, according to both Perry and Price. As most buyers come from Connecticut, New Jersey and New York, they are used to high property taxes. So far, buyers appear willing to accept paying a premium for the lifestyle, controlled development, clean air and beautiful environment that Vermont offers.
If you are thinking of selling your home, Perry and Price offer the following tips:
Ÿ Price appropriately for the market. Use sales from the last eight to 10 months as a guide and price to be best in your category. Overpricing is the most common mistake made by sellers.
Ÿ Declutter. Too much stuff makes rooms look smaller, distracts buyers, and can send the wrong message about cleanliness.
Ÿ Curb appeal and attractive landscaping. If there is something that needs fixing on the outside it raises doubts about what the inside may hold.
Ÿ Be willing to negotiate.
Ÿ Remember that it is a business transaction. Do not take an offer or showing feedback personally.
Ÿ Use a professional Realtor. Most people don’t realize how much is involved with selling a home.