Pacaso Homes Outperform Average Luxury Home Market Appreciation by Double in 10 Key Vacation Home Regions

Friday, September 06, 2024

Recent Articles/Co-owning/Pacaso Homes Outperform Average Luxury Home Market Appreciation by Double in 10 Key Vacation Home Regions

In an impressive demonstration of the efficacy of its innovative co-ownership model, Pacaso, a leader in luxury vacation home co-ownership, has revealed that its properties have significantly outperformed the broader luxury residential market in ten key vacation home regions.

Recent analysis by RCLCO, also highlighted in Yahoo Finance, shows that Pacaso homes have experienced an average annual appreciation of 9.7% since 2021, compared to just 4.9% for the luxury residential market in the same regions.

Pacaso’s Market-Defying Growth

Pacaso’s Market-Defying Growth

The detailed study conducted by RCLCO, a respected real estate consulting firm, compared the resale performance of Pacaso properties with the average price appreciation of luxury homes in the same municipalities.

The analysis focused on Pacaso’s top ten highest-yielding markets, including Napa-Sonoma, Malibu, Lake Tahoe, Vail, Charleston, Park City, San Diego, Newport Beach, Palm Springs, and Miami-Fort Lauderdale. These regions, renowned for their appeal to luxury vacationers, have demonstrated remarkable growth in Pacaso’s property values, far surpassing the broader market averages.

​In Napa-Sonoma, CA, Pacaso shares surged by an impressive 12.4% annually, vastly outperforming the luxury market's modest 0.4% increase. In Malibu, Pacaso shares rose by 9.6%, while the broader market saw a growth of just 2.2%. Lake Tahoe and Vail also experienced notable gains, with Pacaso shares appreciating by 9.5% and 6.7%, respectively, far outpacing their local markets. Charleston, SC, witnessed a 7.9% increase in Pacaso shares, exceeding the market's 2.9% rise.

Although Pacaso homes in Miami-Fort Lauderdale grew by 11.9%, just 0.9% more than the market's 11% increase, this region's performance still surpassed the appreciation rates of the top 10 markets!

Miami has been identified as the top destination for luxury home buyers in 2024, according to Knight Frank's 2024 Wealth Report, and this prediction has proven accurate. With steady demand, Miami's luxury housing market shows no signs of cooling off in 2024. 

This performance underscores Pacaso’s exceptional ability to generate substantial equity for its owners, as well as the robust demand for its co-ownership model in these prime locations.

​As a real estate investor familiar with market dynamics, I can explain why this trend occurs:

In a flourishing real estate market with low-interest mortgage rates and high demand, home prices generally rise, benefiting all property owners, including those with Pacaso. Essentially, a robust market elevates property values across the board.

​Conversely, when mortgage rates are high, overall demand drops, making properties less affordable. In such conditions, the co-ownership model stands out as a viable alternative. It becomes one of the few affordable options available, leading to increased interest and higher sales for co-owned properties. This model’s resilience in the face of rising rates and decreased affordability explains its growing appeal and the subsequent rise in prices and demand.

The Appeal of Co-Ownership

The Appeal of Co-Ownership

Austin Allison, CEO and Co-Founder of Pacaso, emphasized the significance of these findings: "Our first-of-its-kind co-ownership marketplace has set a new standard, with resale values reaching twice the average market rate. This exceptional performance highlights the considerable equity our owners have built with Pacaso and the robust demand for our homes in prime locations."

​The co-ownership model addresses growing affordability challenges and the high cost of luxury vacation homes. By enabling buyers to co-own a premium property, Pacaso makes it possible for more people to enjoy luxury vacationing without bearing the full financial burden. The model's success is evident in the increasing popularity and performance of Pacaso homes.

With a growing demand for the unique co-ownership model, many Pacaso homes have an extensive waitlist of eager potential buyers, with more than 91% of Pacaso homes with substantial waitlists.

Satisfaction and Reinvestment

Satisfaction and Reinvestment

The appeal of Pacaso’s model extends beyond initial ownership. "Three out of four people who resell their Pacaso homes are interested in co-owning another one down the line," Allison noted. This high rate of reinvestment speaks volumes about the satisfaction of Pacaso owners and the perceived value of the co-ownership model.

Pacaso provides a seamless resale process, allowing owners to sell their shares at any time. This flexibility is bolstered by a dedicated resale expert who assists with market analysis and pricing, ensuring a smooth transaction. Pacaso’s robust marketing efforts, including the use of its own marketplace and third-party websites, further enhance the resale experience.

A Modern Approach to Luxury Vacation Homes

A Modern Approach to Luxury Vacation Homes

Founded in 2020 by Austin Allison and Spencer Rascoff, Pacaso has revolutionized luxury vacation home ownership by combining technology with a modern co-ownership model. Pacaso's curated luxury listings feature premium amenities and high-end contemporary design. The company handles everything from integrated financing to professional management and resale support, providing a comprehensive and hassle-free experience for owners.

​The success of Pacaso’s properties highlights the growing relevance of co-ownership in the current real estate environment. Elevated interest rates and affordability challenges have made traditional homeownership increasingly difficult, prompting many buyers to seek alternative solutions. Pacaso’s model not only addresses these challenges but also delivers exceptional financial performance, making it an attractive option for luxury vacation home buyers.

Looking Ahead

Looking Ahead

As Pacaso continues to expand its portfolio and refine its co-ownership model, the company remains committed to delivering value to its owners and meeting the demands of the luxury real estate market. The impressive appreciation of Pacaso homes serves as a testament to the efficacy of its approach and the enduring appeal of its properties in key vacation destinations.

​Want to experience the co-ownership lifestyle for yourself? Explore our partner Pacaso's hassle-free, turn-key co-ownership model!

Check out Pacaso's luxury listings and discover your perfect second home today.

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   Eugene Kamenskiy
Author

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