| Many people looking for a wise real estate | | | | homes as recreational properties for personal use |
| investment usually purchase second homes in | | | | with investment as a secondary reason. Real |
| another place where they can vacation from time | | | | estate experts say it does not necessarily follow |
| to time with their loved ones. The baby boomers | | | | that those who buy multiple vacation properties |
| comprise this segment of real estate buyers | | | | are the wealthy people. This small but growing |
| which in turn drives the growth of the vacation | | | | segment of the market are usually those nearing |
| real estate market. But although a real estate | | | | their retirement, making a good living and have |
| group has reported a plunge in 2006, the demand | | | | more control over their work schedule that they |
| for vacation homes remains strong this 2007. | | | | have extra time to spend at their vacation |
| The National Association of Realtors (NAR) | | | | homes. Apart from recreation, some of them |
| revealed that the sales of second homes for | | | | earn short-term income by renting out their |
| investment went down by 28.9 percent in 2006. | | | | second or third homes. |
| The figure was down from 2.32 million vacation | | | | As for the price, the median rate of a vacation |
| homes sold in 2005 during the peak of the | | | | home in 2006 was down two percent from |
| so-called "five-year housing boom" to 1.65 million. | | | | $204,100 in 2005 to $200,000 in 2006. The typical |
| NAR, however, made it clear that the drop was | | | | investment home also sold lower at $150,000 |
| not due to the general housing slump last year | | | | compared to the $183,500 in 2005. |
| because vacation homes soared by 4.7 percent | | | | NAR studies |
| to a record 1.07 million units compared to 1.02 | | | | The second home segment of the housing |
| million sales in 2005. | | | | market is actually bigger than expected making up |
| NAR further said that based on its survey, 22 | | | | one-third of the market, according to the NAR. |
| percent of all homes bought in 2006 were meant | | | | Two NAR studies have confirmed that indeed this |
| for investment and the figure was down from a | | | | market is growing based on the number of |
| 28 percent market share in 2005. The number of | | | | purchases made in 2003 and 2004. In 2004 alone, |
| vacation homes purchased, though, went up from | | | | 36 percent or a total of 2.82 million of homes |
| 12 percent in 2005 to 14 percent of the total | | | | bought were second homes while in 2003, the |
| market for new and existing homes. | | | | total was only 2.42 million. Investment was the |
| Vacation home buyers | | | | main purpose of the purchases (23 percent) while |
| The typical buyers of vacation homes in 2006 | | | | only 13 percent were for vacation reasons. |
| were those aged 44 and had a median household | | | | NAR's studies on second homes were based on |
| income of $102,000. The vacation homes | | | | two surveys done between middle of 2003 and |
| preferred were at a mid-point of 215 miles from | | | | middle of 2004. Census Bureau statistics in 2003 |
| the homeowners' primary residence. NAR said the | | | | showed there were 43.8 million second homes in |
| demographics were favorable for sales of | | | | the U.S., 6.6 million vacation homes and 37.2 million |
| vacation homes with most consumers in their | | | | investment properties. |
| prime buying ages. Buyers purchased second | | | | |