Realtor's new ‘best friend'
November 12, 2002
NAR study reveals growing interest in vacation properties
Inman News Features
New Orleans—Middle-class Baby Boomers are fueling a growing demand for second homes and resort homes, according to landmark study on the sector presented here today at the National Association of Realtors annual Conference and Expo.
The report, which revealed a few surprises, focused on second-home buyer demographics and the underlying motivation fueling demand.
The NAR found that there are "significantly" more second-homes than expected and the average buyer, at 61 years old, was older than expected. Last year the NAR estimated that the average age of the second-home buyer was 46.
"Based on our survey, a ‘back-of-the-envelope' estimate indicates there may be as many as 7 million vacation homes in the United States," said NAR Chief Economist David Lereah.
The survey, "The 2002 National Association of Realtors Profile of Second-Home Owners," is the largest survey ever conducted by the NAR and the first to look specifically at second-home owners. San Francisco-based EscapeHomes.com, a company that specializes in the resort home market, assisted in the survey.
Factors contributing to the growth of the second-home sector included a poor economy and shrinking 401k plans—85 percent of the second-home purchasers surveyed believed they made a "wise" investment.
The survey also compared second-home buyers who purchased before and after 2000 and found that 16 percent of those who closed more recently used some stock and or bond money to make the purchase, compared with the 7 percent of second-home buyers who closed prior to the collapse of the stock market.
Interest in second homes is expected to continue, primarily due in large part to Baby Boomers' fitness and recreational lifestyle and wealth—and these vacation-home buyers are a real estate agents "new best friend," according to Dennis Hanlon, chairman of the NAR's Resort Forum. Hanlon also is a resort property specialist from Park City, Utah.
"The further you are from you're investment, the more likely you'll need someone to manage it," he said. "The Realtor becomes the best friend of the second-home buyer because they are the ones who know that resort area…who else (will the second-homeowner) call when they need something?"
Hanlon also pointed out that second-home buyers have different needs than the average home buyer—they are not under pressure to buy and it's up to the real estate agent to keep the potential buyer motivated.
"We're selling the lifestyle, the sizzle and the fun," said Hanlon.
Copyright: Inman News Service