Good morning readers,
The National Association of Realtors released information today about the resort real estate market outlook. The bottom line? NAR projects a strong market for the next 5 years. Read the article.
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Resort Market Remains Sunny, but Clouds Gathering
(May 18, 2006) — WASHINGTON – Resort real estate sales should remain relatively strong for the next five years, fueled by continued strong purchase activity by baby boomers and immigrants. However, factors such as rising insurance costs in coastal areas and questions over tax treatment of second homes could have a cooling effect on some markets.
“There’s nothing in the air that changes the fact that boomers are in their peak earning years and they want to buy second homes,” David Lereah, NAR’s chief economist, told the Resort & Second Home Real Estate Committee during the 2006 REALTORS® Midyear Legislative Meetings & Trade Expo.
Lereah noted, however, that there was some uncertainty surrounding resort real estate. For example, Congress could take at least two years to pass a natural disaster insurance bill. Since many resort properties are in higher risk coastal areas, the unavailability of insurance could limit sales. In addition, favorable capital-gains treatment and mortgage-interest deductibility on second homes could come under scrutiny if Congress decides to address the growing federal budget deficit, said Lereah.
“I think though we’re in good shape for the short-term,” said Lereah.
The committee’s chairman, Kenneth Libby of Stowe Realty in Stowe, Vt., told those attending the meeting that 30 real estate professionals had earned the Resort and Second Home Property Specialist certification. The new certification was first unveiled at the 2005 REALTORS® Conference & Expo in San Francisco. Libby set a goal of 750 RSPS certifications by the end of this year. “There are many, many, many people who are very close,” he said.