|The Hilton Head Island metro area, which includes Bluffton and Beaufort, is a hot spot for second homes.
But, compared to other metro areas nationally, it’s cooling off from where it was the past four years based on the percentage of second home mortgages, according to a 2023 report by SmartAsset, a financial technology company.
The area clinched 10th place in a ranking of the top 10 most popular places for second homes, dropping from 7th place last year. Since 2020, Hilton Head has also appeared eighth and ninth on the list.
SmartAsset created the list by analyzing data from more than 400 metro areas and determining their percentage of second-home mortgages.
Compared to its own market in prior years, the percentage of mortgages for second homes in the Hilton Head Island metro area is growing. About 41% of approved mortgages were for secondary homes according to this year’s report, compared to 28% in last year’s.
This year, of the 9,043 approved mortgages, 3,734 were for second homes. Last year, of the 6,708 approved mortgages, 1, 911 were for second homes.
The data comes from the Consumer Financial Protection Bureau’s Home Mortgage Disclosure Act Database and is specific to owner-occupied housing that doesn’t serve as a principal dwelling, which includes second homes, vacation homes, and rental properties, the report said.
It’s important to consider that buyers in Hilton Head put down larger down payments than in the rest of the U.S. — and sometimes completely pay in cash. Therefore, the data excludes second homes that weren’t purchased with a mortgage.
Myrtle Beach is the only other South Carolina city to make the list at number seven.
Other top 10 areas
Ocean City, New Jersey ranked first for the fifth year in a row.
The top ten metro areas and their percentages of second home mortgages are:
- Ocean City, NJ — 81.30%
- Barnstable Town, MA — 61.89%
- Naples-Marco Island, FL — 53.91%
- Salisbury, MD-DE — 953.90%
- Flagstaff, AZ — 51.05%
- Kahului-Wailuku-Lahaina, HI — 48.44%
- Myrtle Beach-Conway-North Myrtle Beach SC — 46.50%
- The Villages, Ocala, FL — 44.56%
- Lake Havasu City-Kingman, AZ — 42.10%
- Hilton Head Island-Bluffton SC— 41.29%