Pacaso is creating additive sales opportunities for second homes

There’s no denying the challenges and unpredictability of today’s macro environment. Suddenly, the idea of owning a second home — which saw a surge in demand during the height of the pandemic — sounds a lot less feasible during these changing times. As the market shifts and inventory tightens, is there still value in the second home market? To help answer that question, Pacaso compiled its Here are the biggest takeaways from the report.  1. Demand remains strong for the luxury second home market Sales of luxury second homes and Home prices decelerated in May 2022 for the first time in five months, likely driven by rising interest rates, uncertain economic conditions and geopolitical unrest. The volatility of the stock market has impacted the overall net worth of many consumers. Despite these changes, affluent consumers are increasingly looking at more stable asset classes like real estate. While interest rates are rising, demand for the housing market continues to be healthy, particularly in the luxury second home segment. While the total share of mortgage rate locks for all second homes fell below pre-pandemic levels, this was in large part due to the median-to-lower end of the housing market. In addition, more than 50% of second home buyers pay in all cash. For this reason, looking simply at second home mortgage rate lock data is not the best indicator of true U.S. second home sales. Luxury second homes overall make up about 12% of all second home mortgage rate locks, and median prices remained relatively flat on a year-over-year basis.  3. Second home buyers are flocking to local destinations For the past two years, premier second home destinations like Malibu, Aspen and Lake Tahoe have seen accelerated prices. This has led buyers to increasingly look at more local destinations for their second home — in particular, destinations where buyers can get more for their money without compromising on their home or nearby attractions. Beachfront counties and areas with year-round outdoor activities saw impressive growth, including Coeur d’Alene, ID, Williamson County, TN, Cape Cod, MA and Sevier County, TN to name a few.  The stability (and opportunities) of the second home market Despite our current reality of rising interest rates and concerns of an impending recession, the numbers show that demand for luxury real estate — the second home market in particular — remained strong during the second quarter of 2022. For clients still hoping to enter the second home market, trends show that real estate remains a stable place to purchase, and even more so through responsible and accessible ownership models, like co-ownership. This can be a huge opportunity for both your clients and your business. For the full analysis and methodology, click

If you’re tempted to buy into one, you should evaluate these timeshare alternatives before signing on the dotted line. There are better options for your vacation, including:   Let’s dive into each alternative and how they stand out from the typical reasons to not 1. Vacation rentals Vacation rentals like Vacation rentals are considered preferable alternatives to timeshares because they give greater flexibility in where and when you can vacation. You’re only paying for specific days, so you aren’t on the hook for yearly fees on top of the purchase price of a timeshare.   Timeshare owners often sell their timeshare days when they can’t use them, giving vacationers the option to visit the same timeshare facility without the long-term commitment.  2. Hotels On a night-by-night basis, Hotels often provide discounts to certain groups (like the military and AAA) or will simply offer discounted rates throughout the year, making them even more affordable. Some hotel chains offer rewards programs, so the more you stay there, the more you get back.  Solo travelers and people traveling in small groups can opt for a related option to save even more money: hostels. They are typically sparse in accommodations, but the trade-off is worth it for people who enjoy different locations every year. 3. Resorts Resorts are like hotels on steroids, offering the all-inclusive appeal of many of the best timeshares. Many resorts provide private beach access, live entertainment, gourmet food and guided tours. You’ll spend less time planning all the details of your vacation, leading to less stress and more time enjoying your break.  Just like hotels, resorts give you the flexibility to stay for longer or shorter durations than a timeshare. You won’t be boxed into traveling at predetermined times of year, and you can visit whenever you want. 4. Vacation clubs Many clubs have blackout dates that restrict your ability to travel unless you pay more money. Depending on the club you join, it could end up costing more per year than even luxury timeshares, but you’ll have easier access to multiple destinations. 5. Travel clubs Travel clubs operate similarly to both timeshares and vacation clubs while being slightly more affordable. Travel clubs require yearly membership fees, and some clubs charge maintenance fees as well. These combined costs are often lower than those of vacation clubs. The benefit of travel clubs is that they arrange for group rates, making your stay cheaper while giving you the benefit of travel companions. Oftentimes the club is centered around a shared trait, like a hobby or age group.  Aside from the social aspect of travel groups, travel clubs also free you from long-term commitments. Even the cost of an inexpensive timeshare begins to add up over the years if you aren’t able to sell it. Since membership to a travel club is yearly, you’ll only lose what you’ve already spent.  6. Vacation home ownership One big draw of owning a timeshare is the dependability of returning to the same destination year after year while avoiding the rising costs of accommodations. Buying a second home in a vacation destination gives you those same benefits and more.  Unlike a timeshare, buying a vacation home gives you real equity in the property, so you have the potential to recoup the money you put into it over the years. Timeshares rarely appreciate in value, and due to the many When you have your own vacation home, you have the freedom to use it as much as you want. In contrast, most timeshare options only allow you to use them once per year and have fixed scheduling limitations.  7. Second home co-ownership  Buying a vacation home is a greater upfront expense than a timeshare, but you don’t have to be the sole owner. Whether you’re buying with a group of friends or buying a Pacaso second home, you still have true real estate property ownership. You’re not just buying the right to use a hotel or condo-sized space for a set period of time. Timeshares are notoriously difficult to sell due to the many rules and limitations owners must abide by. The timeshare is also one of many identical units, creating an imbalance between supply and demand. On the other hand, unique homes attract buyers who must compete against each other in the whole housing market.   Evaluate your vacation options Not all timeshare alternatives are equal. Depending on your vacation goals, it might make more sense to either stick to vacation rentals or make the investment in a vacation property. And if you’re interested in the benefits of

Real estate agents have a new line of business to add to their portfolio: second home co-ownership. With Pacaso’s fully managed co-ownership program, agents can attract even more buyers — specifically, buyers who are dreaming about buying a second home but might not be able to afford or manage a whole property on their own. ​​“Pacaso is really changing the game — not only for agents to sell homes to a wider audience but for the second home owner as well,” said Landon Clements, a real estate advisor for Engel & Völkers, an international firm operating in over 30 countries.  A different approach to second home ownership While demand for second homes is high, owning a whole second home is costly and impractical for most buyers. Pacaso’s model makes ownership accessible for more buyers who can come together, co-own a luxury home and enjoy it on their own time. “The right-sized ownership of Pacaso is a much better model, especially if buyers are not going to spend time in their second home for the whole year,” said Magnus Jennemyr from Engel & Völkers in Miami. “It’s a model where we can see increased appreciation.” With Pacaso, agents can help buyers purchase a dream second home that suits their needs and lifestyles. “If my clients are looking for their second home, I want to be able to help answer any questions,” said Dana Lund from Engel & Völkers in Miami. “Pacaso really does match-make for buyers.” Rewards and opportunities for agents A co-ownership model offers benefits for agents too. Agents earn a buy-side commission on “My job was to introduce my clients to the basics of the Pacaso model,” said Bruce MacIntire from Engel & Völkers in Telluride. “And then I hand them off, very easily, to the Pacaso sales team. To be paid a full 3% commission and do just the introductory part of the work — that’s a good way to go.”  And it’s not just pitching to new clients — Pacaso’s co-ownership model can help strengthen existing relationships. “It’s been a very good reason for me to reach out to old clients to present something new,” said Landon. With Pacaso, agents can delight clients and deliver even more value. Easing friction and increasing enjoyment The work and costs involved in maintaining, furnishing and managing a second home often deters buyers from purchasing a second home. Pacaso’s fully managed co-ownership model takes away these burdens. “Pacaso has thought of every nuance, every detail and every little idea that needs to be done,” said Lee Roufa from Engel & Völkers in Telluride. “They eliminate all the hassles and headaches of buying a second home.”  A worry-free, accessible second home is a strong selling point for both buyers and agents. “To be able to come with your family or friends and make memories in a house that’s truly yours … the sky’s the limit on what we can do and what’s possible,” said Landon. Exciting opportunities are on the horizon As Pacaso strives to bring second home ownership to more people worldwide, there could be even more room for agents to grow their business.  ​​“Now that Pacaso is also expanding internationally, I could reach out to our office in Spain and talk about it,” Dana said. “Having this global presence is an amazing, amazing thing.” Ultimately, Engel & Völkers advisors see co-ownership as a boon to the industry. “Pacaso is a game-changer, and it’s just in its infancy,” said Magnus. “It’s going to explode.” Interested in working with Pacaso to expand your services and win over clients? Check out our agent resources

As an agent, you look for ways to help your business to stand out and better serve your clients — especially during times of high demand and low inventory. Denver RE/MAX agent Lana Kuznetsova interviews Pacaso’s Vice President of Industry Relations Marnie Blanco about the uniqueness of the Pacaso co-ownership model and the many ways agents can generate more commissions with Pacaso’s second home listings. “This is just another way for agents to step up and grow their business even further, and it’s pretty easy,'' said Marnie. “We partner them with our sales team, and our sales team takes care of the transaction — quick close, quick payments for the agent. It’s easy to introduce it to your clientele and give them options.” Watch the interview to hear how agents can work with Pacaso and earn referral commissions.

Inflation has reached its highest level since 1981 as the latest Consumer Price Index (CPI) increased 9.1% in June. In addition, mortgage rates in April surpassed 5% for the first time in over a decade and have remained elevated since. This is the first time in recent history that inflation is meaningfully higher than mortgage rates. As the cost of consumer goods in the U.S. rises faster than mortgage rates, there are financial decisions consumers should consider to hedge against inflation. Many advocate putting money into long-term assets such as real estate, including second homes, as a way to hedge against inflation. Although mortgage rates have nearly doubled since the start of 2021, it is important to remember that rates are still well below historical norms. For the past 50 years, 30-year fixed mortgage rates have averaged approximately 8%, even crossing above a staggering 18% in the early 1980s.  Inflation has reached levels we have not seen in over 40 years. Many economists believe that the CPI will remain elevated for the rest of this year and may hold up into 2024. As inflation rises, the cost of everything goes up, including real estate. However, when the CPI growth rate is higher than the current 30-year fixed mortgage rates, homeowners’ will be spending the same monthly amount but with inflated dollars. As a result, smart home shoppers tend to be less concerned about the current levels of mortgage rates when inflation is high. This could provide home buyers with a rare opportunity to make a stable-value investment and take advantage of the growing rate of depreciation of money. In an inflationary environment, consumers want to park their money somewhere that will lose the least amount of value. For that reason, real estate is often considered one of the best ways to hedge against — or beat — inflation. 

“Pacaso gives people such a great access point to home ownership,” said Marnie. Watch the video to learn about Pacaso’s co-ownership model, get an inside look at a luxury home, and hear from an owner what it’s like to own a Pacaso — and why it’s different from a timeshare.

In a desirable retirement destination like Palm Springs, it can be difficult to find a home, let alone a second home. Greater Palm Springs Compass real estate agent Lauren Malo shares how she helped her clients purchase their dream second home with Pacaso — and why transactions with Pacaso are ideal for agents, too.  “We don’t have to worry about inspections, appraisals, showings and final walkthroughs,” said Lauren, who worked with Pacaso’s local Market Principal Shea Vendl. “It’s really seamless.”  Watch the video to learn more about how Pacaso’s co-ownership model, what it’s like for agents to work with the Pacaso sales team, and the ease of the buying process.

When it comes to buying a second home, your clients have several options. The default choice — buying a whole home — offers the most flexibility. However, the The good news is that you can guide your clients toward other ownership paths to make their second home dream a reality. There are three paths to explore with your clients: timeshares, fractional ownership and co-ownership. The right choice starts with the right planning First things first: You’ll want to encourage your clients to determine what matters the most to them. Second home paths offer varying levels of equity, flexibility and responsibility. Buyers should ask themselves: How much time will they spend in their home? Will they plan their stays ahead of time or be more spontaneous? How much time do they have to customize and maintain their home? There’s no one-size-fits-all approach. However, with the proper planning, your buyers can purchase a second home that works with their schedule, their budget, and their time and willingness to maintain and manage it. Once you’ve helped them determine these parameters, they can consider the different ownership paths. The truth about timeshares The first option is a timeshare. With a timeshare, buyers purchase the right to use a vacation property or condo for a set period. A timeshare is suited for buyers looking for one- or two-week vacations a year. Rather than owning the home, buyers are more like “renters” at the timeshare. While they won’t need to maintain the timeshare, they don’t have equity in it. If owners want to sell off their timeshare in the future, most timeshares sell at a significant loss (if owners are able to sell at all). In addition, a timeshare does not provide any specific benefits to agents as they are sold exclusively through a timeshare company. Fractional ownership, fractional benefits Fractional ownership works for buyers looking for deeded ownership, shared maintenance costs and longer vacations in resort properties. However, it can be costly to purchase a fractional and even more expensive to maintain one over time. As an agent, you can earn commission on a fractional, but buyers are required to pay membership to a club or property management group. Resale opportunities are also uncertain. The difference with co-ownership A co-ownership model is a step above fractional ownership. With co-ownership, buyers own a share of a private, high-value home with a small number of other buyers. This path is a good option for clients looking for more accessibility and flexibility than a fractional ownership and more equity than a timeshare. Instead of  With the right path to ownership, your buyers can secure a more meaningful place to call home, which is a win for them and a win for your business.