Redfin: Vacation-Home Mortgages Increase for First Time in Four Years

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Redfin, Seattle, found second-home mortgages increased by 4.1% in 2025 compared with 2024.

That’s the first annual increase in four years.

It’s also a larger increase than primary home mortgages saw–those were up 1% year-over-year in 2025 compared with 2% in 2024.

Redfin points to affluent buyers–who tend to be less constrained by today’s high housing costs and economic uncertainty–as driving the market. In fact, 85% of second-home mortgages in 2025 went to high earners–the typical borrower had a median income of just under $300,000.

Demand for luxury homes is also growing, and the typical second home purchased in 2025 was $515,000. That compares with $395,000 for primary homes.

However, the report also cautioned that while second-home mortgages have ticked up, they’re still lower than they were before and during the pandemic. In 2025, 2.7% of all mortgage originations were for second homes, down from a peak of 5.1% in 2021.

“Vacation homes are making a modest comeback, but it’s a very different market than it was during the pandemic,” said Chen Zhao, Redfin’s head of economics research. “Today’s second-home buyers tend to have the financial flexibility to make a big, discretionary purchase even in an expensive housing market, while many would-be buyers of primary homes are sidelined by high costs. Vacation homes are less appealing for regular Americans than they were during the pandemic because mortgage rates are much higher now and rentals are less lucrative.” 

Second-home mortgages made up the largest share of originations in West Palm Beach, Fla., with 5.5% of all mortgages originated there in 2025 intended for vacation homes. Next is another popular vacation spot–the Jersey Shore (the New Brunswick, N.J., metro area)–where 4.6% of all mortgages were for second homes. No. 3 is Riverside, Calif., home to Palm Springs, with 3.8% of all mortgages provided for second homes.