Commercial PropertyHouseValues Survey Reveals Interesting Trends Among Second Home Buyers
It"s great news for the airlines. A large percentage of second home buyers would as soon fly as drive to reach their vacation homes, says a new survey by HomePages.com, a division of HouseValues that allows consumers to see aerial views and neighborhood-centric information of homes.
While most second home buyers would like their second home to be an hour"s drive or less (43 percent), 29 percent said they didn"t mind catching a flight.
With plenty of disposable income to spare, 21 percent of 1,300 consumers surveyed said they are considering purchasing a second home within a year, while another 42 percent say they"re considering buying within the next two to six years.
It appears the economy and housing are hardly going down the tubes.
In fact, "vacation and investment homes remain a strong and prominent part of the real estate market, both as a means of providing an escape and providing supplemental short-term and long-term income," says Ian Morris, chief executive officer of HouseValues.
A quarter of respondents said they are considering a second home for investment purposes, while 22 percent said they wanted one for "enjoyment," such as weekend getaways, vacations and family use.
Forty percent of respondents said features such as water or mountains would not be a factor because they intended to buy for investment purposes. Among those who do consider geography an important factor in where they buy, 36 percent listed proximity to water as key, followed by mountains (17 percent), golf courses (5 percent) and the desert (2 percent).
Yet, even disposable income runs out when it hits hurdles. Asked what factor would most likely cause them not to buy a second home, 32 percent of respondents listed rising home prices, followed by rising mortgage rates (18 percent) and job insecurity (12 percent). Thirty-eight percent listed a variety of other factors.
Sixty-five percent of respondents were women, 35 percent were men.
According to the preface of the 2006 National Association of Realtors Profile of Second-Home Owners, second-home owners are defined as those who "own one or more residential properties, in addition to a primary residence, and who use these properties either for vacation or investment purposes. Although both types of properties share several attributes, vacation homes are properties owned primarily for recreational use by the owner or their family, while investment properties are owned primarily to rent to others."
Ownership of more than one home is increasingly common, notes NAR, due to peak earnings of the baby boomer segment of the population, less-than-stellar returns in other financial assets other than real estate, and popular tax incentives (including capital gains exclusions) and loan programs that favor buying property over other investment instruments. For example, between 2000 and 2005, the value of homes nationwide rose over 50 percent, while the Standard & Poor"s 500 Index returned just over 2 percent for the same period, says NAR.
Older baby boomers dominate the second-home market as vacation-home owners (age 59) and investors (age 55) and most own multiple properties. About six in ten survey respondents own two or more homes in addition to their primary residence.