From Vacation Getaway to Permanent Paradise: The Rise of Buying While Vacationing

Irene Rawlings

Vacation Rental to Ownership

Buying a vacation home while vacationing is not a new trend, but the trend did surge during the height of the pandemic, when many discovered they could work from any place in the world that had a high-speed internet connection. Working from a beloved vacation property provided both privacy and serenity, and made “a day at the office” seem a little less like real work.

Buying and working from what would previously have been considered, essentially, a vacation home shows little sign of abating. Michael Altneu, vice president of Coldwell Banker Global Luxury, says, “With fewer high-end listings to choose from this year, a desire for instant gratification and a general aversion for renovations, we’re seeing affluent buyers more likely to adopt a ‘move-in-and-enjoy-now’ approach in 2024. This can certainly translate to buyers being eager to buy the very homes that they’re currently enjoying their vacations in.”

Beyond the investment potential (a home can generate short-term rental income while also appreciating and providing tax benefits), owning a second home in a beloved locale can be a place to create new traditions, take a spontaneous weekend getaway, and visit year after year to relax without having to plan or deal with the unexpected.

Mauricio Umansky, CEO and founder of international, high-profile brokerage firm The Agency, says, “We’ve observed a significant uptick in demand from second- or third-home buyers who are captivated by a lifestyle experience while vacationing. Many of our clients express interest in purchasing properties they’ve enjoyed during their vacations, seeking to recreate that exclusive and luxurious atmosphere as a part of their own real estate portfolio.”

Try Before You Buy

According to The Agency, the try-before-you-buy trend has become a significant driving force in the luxury real estate market, particularly in desirable and sought-after locations. Discerning buyers are increasingly opting to experience the lifestyle firsthand through short-term rentals, allowing them to immerse themselves in the ambiance, amenities, and overall experience of a location before committing to a long-term investment.

Kiplinger Personal Finance advises this: If you’re considering a place that you’ve visited only as a vacationer, keep in mind that owning a home there comes with a different set of concerns—from maintenance and security to financing and taxes.

A modern villa with a swimming pool at dusk. The villa has white walls and a large retractable patio wall, with a wooden deck surrounding the pool. There are lounge chairs and potted plants around the pool.

Marbella, Spain

Marbella in the Costa del Sol is considered the most popular holiday destination in Spain. Leif Orthmann and Kristoffer Enger, managing partners of The Agency Marbella, are seeing the try-before-you-buy concept gain momentum. “It’s a trend that not only boosts the rental market but also leads to more informed and satisfied property purchases,” they say, adding that they have also observed vacationers, especially those renting luxury villas, express an interest in purchasing those very properties as their second or third home.

Interior of a modern luxury kitchen with a large island, marble countertops, and dark wood cabinetry. The kitchen has sliding glass doors leading to a covered patio with ocean views.

Kukui’ula on Kauai

Kukui’ula (kukuiula.com), on Kauai’s southern coast, is a 1,010-acre community of ocean-view homesites, custom homes, a clubhouse, tennis and pickleball courts, a saltwater pool, and a Tom Weiskopf–designed golf course. Suzanne Harding of Kukui’ula Realty Group says that prospective buyers often stay in one of the property’s bungalows, cottages, or villas to get a feel for the lifestyle.

Aspen, Colorado

In Aspen, Colorado, Carrie Wells, a luxury agent at Coldwell Banker, says, “People come here and fall in love with the scenery, the culture, and the active lifestyle ... motivating them to find a property to buy during their stay.” She is currently working with a client who is trying to decide between two areas in the Roaring Fork Valley. “They’ve rented in one area and this summer they’re planning to rent in a different spot, which will help them decide what is best for their family and lifestyle,” she says.

Catering to a category of active, affluent renters-by-choice, Heatherwood’s newly built Heritage Spy Ring Residential Community on New York’s Long Island offers a Tyler Rae–designed, PGA-quality nine-hole course, tennis and pickleball courts, a well-equipped fitness center, a private fitness studio, and physical therapy rooms. From $7,000 per month for a three-bedroom; heatherwood.com

Off-Market Sales

Known as word-of-mouth listings, off-market sales have always existed in the ultra-high-end market. Blue-chip properties, often with price tags of more than $10 million, are made known to a small number of influential realtors. Now this hush-hush approach has spread to lower price points—especially in the most desirable second-home markets where, quite often, demand outpaces supply. Ian Gengos of Berkshire Hathaway HomeServices Baja Real Estate says, “It’s always worth making a strategic offer on a property you like if you go through the appropriate channels. That said, you may not always be successful because vacation rentals are quite strong income properties for homeowners.”

Spacious and modern living room with floor-to-ceiling windows offering panoramic ocean views. The room features a neutral color palette with beige sofas, a patterned rug, and a dining table with chairs.

Miami is part of South Florida’s thriving off-market inventory.

South Florida’s real estate market is thriving—from Miami to the Palm Beaches. “Off-market sales are common in constrained inventory markets like Florida’s, which are also influenced by ultra-wealthy buyers’ habits. When a buyer desires a property that’s not actively listed, it’s important for me to have an ear to the ground for all potential upscale homes across South Florida’s various markets,” says Jonathan Postma, Florida-based luxury agent at Coldwell Banker.

A luxurious outdoor terrace overlooking a panoramic coastal view. The terrace features a modern sectional sofa, armchairs, and ottomans in neutral colors, with a swimming pool in the foreground and a sculpture in the distance.

Mallorca, Spain, is a booming vacation home market.

Mallorca, the largest of Spain’s Balearic Islands, is a booming vacation home market known for its year-round sunshine, white-sand beaches, yacht harbors, and, in Palma, lively bars and large-scale clubs. “A large percentage of the sales on this island are off market. The larger transactions in particular ... as many owners listing with larger price tags tend to prefer off-market strategies,” says Alby Euesden, managing partner of The Agency Mallorca.

“The exclusivity and privacy associated with off-market sales has become a strategic avenue for us to meet the unique demands of our clients and provide them with a tailored, personalized real estate experience. Leveraging our extensive network and taking a discrete approach enables us to facilitate these off-market deals, ensuring that our clients can acquire their dream vacation homes with the utmost confidentiality,” says The Agency’s Umansky.

Photo credits: Courtesy Images, From Top: Kukuiʻula (2); The Agency; Coldwell Banker/Draper White; Coldwell Banker; The Agency Mallorca/Dream Destination Media