I've Pretty Much Given Up on Buying a Vacation Home. Here's Why

It's an idea that just doesn't seem to be panning out.

In the wake of the pandemic, the demand for vacation properties has risen. In 2020, vacation home sales rose by 16% on an annual basis. And given that so many people are continuing to work remotely, it's likely that vacation homes will remain popular among those who are able to afford them.

What's funny, though, is that my husband and I had buying a vacation home on our radar well before the pandemic. We've been stashing money in a separate savings account for that purpose for about five years now. 

But at this point, it may be time for us to find a different use for that cash. That's because we've largely given up on buying a vacation home despite wanting one.

A purchase that doesn't make a lot of financial sense

There's a specific area my husband and I visit every year. It's about five hours away from our home and offers amenities like awesome hiking trails and great food. 

When we realized this was an area we'd be making an annual trip to, we got serious about saving for a vacation home there. That's because rentals in the area can be pricey. Also, because summer is the most popular time to visit, you really have to be vigilant about booking lodging ahead of time to avoid being closed out. And that can make things a little stressful, because we sometimes like to book trips on a whim.

Our logic in buying a vacation home was to have a place to stay in that area whenever we wanted. And we figured we could try to rent out that property from time to time to help cover the mortgage costs.

But then the housing market exploded. And over the past two and a half years, the cost of a modest home in that area rose by well over $100,000. Between that and higher mortgage rates, a vacation home is no longer as affordable to us as it once might've been.

Of course, home prices and mortgage rates might come down in time. But we've also realized that buying a vacation home that's five hours away doesn't necessarily make sense.

As much as we can say that we'll make the effort to get there, carving out 10 hours of driving in a single weekend isn't easy. And so chances are, we wouldn't be able to use that home all that often.

Plus, the idea of a string of free weekends is really a joke in our world. We can blame our kids' activity schedules for that. Between sports, Cub and Girl Scouts, and birthday parties galore, it's rare for us to be able to get away for a random weekend during the school year. And summers can be hectic, too. 

So all told, we don't see the point in spending so much money on a vacation home we'll rarely get to use. We're better off spending a fraction of that on a nice rental the one or two weekends a year we manage to get back to our favorite spot.

We're giving up, but we're not rushing to spend our money

At this point, our vacation home fund has grown nicely. But we plan to leave that money alone for the time being just in case we change our minds. 

A vacation home might seem more appealing to us once the housing market calms down, which is apt to happen eventually. And if our schedule calms down as well, maybe that purchase will make sense in time. That's why we're technically keeping our options open, even though we're pretty sure a vacation home isn't really in the cards for us.