Second home buying, residential real estate investment purchases fall again

Not that it should come as any surprise, but the latest figures out of the National Association of Realtors show that the vacation home and investment share of home purchases continued to drop in 2007. Investment purchases accounted for just 21% of the market in 2007, down from 22% in 2006. Vacation home purchases were just 12% of the market, down from 14% a year earlier.

That means the total share for non-owner-occupied purchases dropped to 33% of market transactions from 36% in 2006. At the peak of the bubble in 2005, that share hit a record 39.9%. In terms of volume, vacation home sales plunged 30.6% to 740,000 in 2007 from 1.07 million in 2006, 1.02 million in 2005, 872,000 in 2004, and 849,000 in 2003. Investment home sales dropped 18.1% to 1.35 million from 1.65 million in 2006, 2.32 million in 2005, 2 million in 2004, and 1.57 million in 2003.