Vacation News » Miami Beach Edition | By Michael Gerrity | May 9, 2025 7:45 AM ET
A new Redfin report reveals that American appetite for vacation homes has continued its steady decline, reaching the lowest point in at least six years.
In 2024, U.S. homebuyers took out just 86,604 mortgages for second homes--often used as vacation properties -- marking a 5% drop from the previous year and the lowest level since Redfin began tracking this data in 2018. The analysis, based on Home Mortgage Disclosure Act (HMDA) data, also shows that second-home loans accounted for just 2.6% of all mortgages issued in 2024, down from 2.8% in 2023 and far below the 2020 pandemic-era peak of 5%.
Although the decline slowed from the dramatic drops of 42% in 2022 and 40% in 2023, the continued slide underscores a changing landscape for buyers of discretionary properties.
Why Are Vacation Home Mortgages Falling?
Redfin cites multiple factors behind the trend:
"Most people aren't buying vacation homes at all because mortgage rates and insurance costs--especially for waterfront homes and condos--have skyrocketed," said Lindsay Garcia, a Redfin Premier agent in Fort Lauderdale. "Even wealthy buyers are negotiating harder or walking away."
Florida Leads the Decline
Florida, long seen as a hotspot for vacation homes, saw the steepest declines. Miami posted a 32.2% year-over-year drop in second-home mortgage originations -- the largest among major metros. Other Florida cities followed closely behind, including Orlando (-28.4%), Fort Lauderdale (-28%), West Palm Beach (-23.7%), and Tampa (-20.9%).
Rising property costs, insurance premiums, and heightened risk of natural disasters are all cited as deterrents for potential second-home buyers in the Sunshine State.
Yet Florida still dominates in second-home concentration. In West Palm Beach, second-home loans made up 5.6% of all mortgages in 2024 -- the highest share in the nation--followed by New Brunswick, NJ (4.2%) and Riverside, CA (3.5%).
Where Second-Home Mortgages Are Growing
Despite the national downturn, a few metros bucked the trend. Detroit led with a 26% rise in second-home mortgage originations, followed by San Francisco (17%) and San Jose (15.9%). Still, such mortgages remained rare in these areas, accounting for less than 2% of all home loans.
Who's Still Buying Vacation Homes?
Redfin's demographic breakdown paints a clear picture of who's still in the market for a second home:
The market for vacation homes appears to be resetting after the pandemic-era boom. With affordability strained and rental returns muted, the once-surging segment now seems relegated to a narrower, wealthier pool of buyers.