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Soaring Mortgage Rates in U.S. Dent Demand for Vacation Homes

  • Demand drops to lowest level since May 2020, Redfin says
  • Fee increase on some second-home loans also deterring buyers
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Demand for second homes in the U.S. is plummeting as mortgage rates climb steeply.

After a pandemic buying frenzy, mortgage-rate locks to buy second homes dropped last month to the lowest level since May 2020, according to a report by Redfin Corp. While demand was still up 35% from February 2020, before Covid-19 hit the U.S., it was significantly lower than the previous month’s 87% jump, the brokerage said.