St George • It will never be confused with Napa Valley, Martha’s Vineyard or Beverly Hills, but southwest Utah’s Washington County has the right to brag in at least one area – the growth of its luxury second home market.
Pacaso, a San Francisco-based company specializing in helping people buy or co-own second homes, has named Washington County the nation’s fastest growing market for luxury second homes, defined as homes sold for seasonal or recreational use are for 1 million dollars or more.
Nearly 27% of real estate transactions completed in Washington County last year involved mortgage rate locks on luxury second homes, up 10.3% from a year earlier, according to a Pacaso report released last month. Second home mortgage rate lock data is an indicator of second home buying activity.
That means, according to the report, Washington County saw the largest annual increase in luxury second-home mortgage rates in the nation, eclipsing runner-up Osceola County Florida by more than 40% and far exceeding rates for more traditional luxury homes in destinations like New York County, Napa County, California, and Santa Fe County, New Mexico.
The median price for luxury second homes in Washington County last year was $1.3 million.
Luxury home prices in Washington County have ranged from $1.3 million to $10 million over the past decade. A total of 559 homes within this price range have been sold in the past 10 years, including 514 cash sales, according to the Washington County Multiple Listing Service.
Robert Bolar, a top real estate agent at Summit Sotheby’s International Realty in St. George who specializes in luxury real estate, isn’t surprised.
“The main attraction for my customers – who come from all over the country – is the sun, which shines here 300 or more days a year,” he said. “Whether it makes you think spring has arrived early or gives you another day at the beach on a fall afternoon, the sunshine around this area seems to get my clients to enjoy the outdoors.”
It certainly gave Sam Allred, who lives in Heber, the idea of buying a luxury second home in Green Springs.
“We wanted it warmer, in a second home that’s only about four hours away [from our primary residence] and in an area that has been busy all year round,” said Allred, a management consultant for CPA firms nationwide.
Real estate agents say that Washington County’s cultural, sporting and outdoor recreation opportunities, as well as its proximity to national and state parks, attract second-home buyers and help them weather southwest Utah’s unbearably hot summer months. In addition, the St. George Regional Airport offers easy access to international airports in Salt Lake City, Phoenix and Denver, among others.
“Education and jobs are also a key attribute, although not necessarily for those looking for second homes,” said Emily Merkley, CEO of the Washington County Board of Realtors. “It’s important, however, as it feeds into growth projections for our region.”
Washington County, which includes the St. George metro area, was the fastest growing percentage metro area in the country between July 2020 and July 2021.
“Anyone with disposable income looking for a solid investment (a second home) in an area that is seeing growth and positive appreciation, surrounded by outdoor amenities and that is easier than ever to access will find Washington County attractive,” Merkley added added.
Rising interest rates have dramatically slowed home sales across the country, with one notable exception – the luxury home market. According to Pacaso, luxury second home transactions increased 25% in the second quarter of 2022 compared to the same period last year.
“Despite a nationwide slowdown in residential real estate, we realize that the luxury real estate market is still in a league of its own,” said Austin Allison, CEO of Pacaso.
Merkley said Washington County home sales have declined significantly since the 2020-2022 post-pandemic boom. She said luxury homes, which the board considers to be anything over $750,000, are still selling reasonably well. As for sales of first and second homes, she added, the county’s multiple listings service doesn’t track that information.
Still, Merkley said Pacaso’s figures for luxury second home sales are likely fairly accurate, since “high and rising interest rates aren’t affecting this buyer demographic as much as they would [for those] acquisition of their primary residence. Most enter the [secondary-home] Market with cash or large amounts of cash and therefore do not rely on financing,” she said.
Jeff Sproul, the principal broker at Kayenta Homes and Properties, said the market for the luxury homes he’s selling — which range from $1 million to $3 million — has slowed but not softened.
“We still can’t keep houses on the market very long,” Sproul said. “Even with the real estate industry slowing down, we’re doing pretty well because most buyers here are paying cash.”
About 30% of Kayenta’s properties are luxury second homes, according to Sproul.
“Most of our buyers are from northern Utah. We’re getting a lot of people from Park City,” Sproul continued. “We’re also getting buyers from California, Jackson Hole, Wyoming and the East Coast.”
To make luxury second homes more affordable, some cash buyers are banding together to ease the financial burden. Sam Allred and his wife Marlene, for example, along with five other couples, bought a luxury home in Green Springs a few years ago and have since added a pool and hot tub. Each couple uses the house about 10 weeks a year, which is planned about five years in advance.
“The remarkable thing is that I’m not sure we would have looked at this house individually,” Allred said. “If we’d spent the money alone to buy it, we’d feel like we had to be down there all the time… But when you divide the price of the house by six, it becomes wonderfully affordable for everyone, and you end up with it.” with a beautiful home.”
Some of the top luxury properties in Washington County, realtors agree, include Desert Color, Kayenta, Entrada, Stone Cliff, and The Ledges.
Wherever there are luxury second homes in the county, Bolar says they have two things in common: “stunning natural beauty and plenty of Instagrammable moments.”
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https://www.sltrib.com/news/2022/12/30/washington-county-tops-chart/ Washington County is leading the growth of the luxury second home market