About 16 million homes remain vacant nationwide

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A new analysis of a March LendingTree study found more than 16 million vacant homes in the United States. This figure may seem high, but becomes more reasonable when you consider the number of empty homes across the country waiting to be rented or sold or for their owners to stay in their primary residence.

While there are plenty of vacancies in large cities, vacancy rates are often higher in cities. With that in mind, LendingTree used data from the U.S. Census Bureau’s 2020 American Community Survey to analyze vacancy rates in the nation’s 50 most expensive micropolitan areas — referred to in this study as “cities” — with populations including between 10,000 and 50,000.

More than 320,000 homes in the country’s most expensive cities are vacant. Of these dwellings, just over two-thirds are empty because they are only used for seasonal, recreational or occasional purposes.

  • In the 50 most expensive cities in the country, 23.42% of homes on average are vacant. This translates to 320,346 empty houses.
  • Breckenridge, Colorado, Vineyard Haven, Massachusetts and Kill Devil Hills, North Carolina have the highest vacancy rates among the most expensive cities. On average, nearly 60% of all homes in these popular vacation and tourist destinations are vacant. Among these vacant dwellings, 83.69% on average are unoccupied because they are only used for seasonal, recreational or occasional purposes. In other words, second homes that sit unused for most of the year are the primary cause of high vacancy rates in these cities.
  • Juneau, Alaska, Faribault, Minnesota and Moscow, Idaho have the lowest vacancy rates among the most expensive cities. On average, only 7.54% of homes in these cities are vacant, which is 15.88 percentage points lower than the average vacancy rate of 23.42% in the country’s 50 most expensive cities.
  • Houses in the country’s most expensive cities are the most likely to be vacant because they are only used for seasonal, recreational or occasional purposes. On average, 58.88% of the vacant dwellings analyzed in our study are empty for this reason.
  • Cities with higher vacancy rates tend to have more expensive homes than those with lower vacancy rates. The median home value in the 10 cities with the highest vacancy rates is on average $177,190 more expensive than the median home value in the 10 cities with the lowest vacancy rates. While there are exceptions, the main reason is probably that buyers are often willing to shell out top dollar for vacation homes they don’t live in all year round.

Municipalities with the highest vacancy rates

  1. Breckenridge, Colorado
  • Total number of dwellings: 31,158
  • Overall vacancy rate: 62.74%
  • Most common reason homes are vacant: Used for seasonal, recreational, or occasional purposes
  • Percentage of vacant units for the most common reason: 93.83%
  • Median home value: $596,300
  1. Vineyard Haven, Massachusetts
  • Total number of dwellings: 18,030
  • Overall vacancy rate: 61.80%
  • Most common reason homes are vacant: Used for seasonal, recreational, or occasional purposes
  • Percentage of vacant units for the most common vacancy reason: 96.15%
  • Median home value: $794,000
  1. Kill Devil Hills, North Carolina
  • Total number of dwellings: 35,007
  • Overall vacancy rate: 54.78%
  • Most common reason homes are vacant: Used for seasonal, recreational, or occasional purposes
  • Percentage of vacant units for the most common vacancy reason: 61.10%
  • Median home value: $297,200

Cities with the lowest vacancy rates

  1. Juneau, Alaska
  • Total number of dwellings: 13,792
  • Overall vacancy rate: 6.63%
  • Most common reason homes are vacant: Other
  • Percentage of vacant units for the most common vacancy reason: 37.86%
  • Median home value: $355,100
  1. Faribault, Minnesota
  • Total number of dwellings: 25,161
  • Overall vacancy rate: 7.86%
  • Most common reason homes are vacant: Other
  • Percentage of vacant units for the most common vacancy reason: 42.21%
  • Median home value: $232,800
  1. Moscow, Idaho
  • Total number of dwellings: 17,132
  • Overall vacancy rate: 8.14%
  • Most common reason homes are vacant: Other
  • Percentage of vacant units for the most common vacancy reason: 49.61%
  • Median home value: $245,200

High vacancy rates do not always mean that there is not a lot of housing demand in a given area. As a result, home prices in this area would be lower than in an area with a lower vacancy rate. Houses are not necessarily vacant because they are undesirable. Instead, houses may be considered vacant because they are not being used. For example, an expensive vacation home that sits empty because its owner is in their primary residence would be considered vacant, as would a recently sold home that isn’t quite ready to move in.

An area’s vacancy rate alone cannot show the popularity of a given real estate market or its likely price, but it does not mean that an area’s vacancy rate is not important or cannot shed light on what is happening in a specific area. market.

High vacancy rates and high house prices may suggest that an area has a strong housing market, but many people live elsewhere for most of the year. This is usually the case in resort towns like Breckenridge, Colorado. High vacancy rates and low house prices, on the other hand, could mean that a housing market is struggling and there isn’t much demand for housing.

If vacancy rates are low and housing prices are high, it could mean that the market is very competitive and there is not enough housing supply to meet demand. If vacancy rates and home prices are low, it could mean that demand is high, but sellers are selling their homes for less than they could have gotten.

Ultimately, understanding vacancy rates is important to understanding the entire housing market. But to appreciate what a vacancy rate means, you have to look behind the facade at why homes are vacant.

Tips for Buying a Home in a Small Town

With remote work becoming more normalized, many people may think about moving to a small town to save money or escape a hectic urban lifestyle. While some towns are quieter and cheaper than cities, not all are. With that in mind, homebuyers should consider the following tips to better prepare before buying a home in a small town:

  • Shop around to find a lender. Since different lenders may offer different rates to the same borrowers, it’s often possible to find a lower rate by researching a mortgage before buying a home. A lower rate can help you buy a more expensive home and/or lower your monthly mortgage payments.
  • Small towns can still be expensive, even those that aren’t necessarily common vacation destinations. Depending on where you plan to move, a house in a city can cost the same as a house in a big city. This may be especially true in more rural towns where builders may not have the incentive to build large numbers of middle-class homes, which means buyers often have to compete hard for a limited number of homes on the market. the market.
  • Learn about the area before you travel. Like everywhere else, cities have unique advantages and disadvantages. For example, cities are often not as walkable as cities. Beyond that, the things people depend on in an emergency like hospitals or fire departments may not be as well funded or equipped as those in big cities. Therefore, if you decide to move to an area without fully understanding what it has to offer or not, you might find yourself dissatisfied.

To read the full report, including more charts and methodology, Click here.