BiggerPockets Daily Seasonal Housing Markets Begin to Feel the Impacts of a Softening Economy
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Sep 16, 2025 Home sales in popular vacation spots are plummeting as second-home buyers pull back due to high costs and stricter rental rules. Inventory is rising, with prices leveling off, creating a landscape ripe with both risks and opportunities for investors. The podcast delves into the challenges faced by buyers, particularly in Florida, amid increasing mortgage rates. It also discusses how reduced travel budgets impact rental demand and the overall dynamics of these seasonal housing markets.
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Second-Home Demand Has Weakened
- Seasonal (vacation) towns are cooling faster than non-seasonal markets as second-home buyers retreat.
- Redfin found sales in seasonal towns fell 3% year-over-year in July versus 1% in non-seasonal towns.
Affordability Hits Second Homes First
- High mortgage rates and poor affordability are cutting discretionary second-home purchases first.
- Buyers face higher down payments and only about one-third of homes are affordable to the median earner.
Plan For Bigger Down Payments
- Consider higher upfront costs when targeting second-home buyers since lenders require larger down payments.
- Expect 15–25% down payments for non-primary residences and plan acquisitions accordingly.