Where are vacation homes located in the US?
construction-physics.com
construction-physics.com
I would guess that another huge factor has been the decline in the real cost of air travel. It’s now cheap enough that people with money can reasonably expect to fly somewhere for every vacation they want to take. You don’t need a condo near the local ski resort if you can fly to a different one every winter.
In fact, I feel buying property in one vacation spot is starting to look more like an anchor than an escape hatch. Keeping capital in securities instead is more liquid and less expensive (stocks don’t have roofs or plumbing). Let someone else own the hotel or AirBnB or VRBO. I’ll fly in and rent it just for the vacation. This mindset may partially explain why vacation home ownership has not “kept up” with the growth in real wealth.
To your point I liked the liquidity of equities but it has been nice to do something with it beyond just watching a number in a spreadsheet. If we want a change in scenery it’s a wash to rent our own place out and stay in another.
I’m asking about people’s experience in a world where AI buyers have already existed for 3-5 years. You’ll have to take a time machine to debate that.
I’m sympathetic to that complaint a bit but it’s also a bit like NIMBY.
Generally I think the cheapness of travel has been an unsung net negative for humanity as a whole.
source: i live in seattle and my partner owns property where 1/4 of their neighbors are landlords in a new construction complex
But Seattle and NYC Airbnbs aren't second homes, it's investments people were trying to play with. A vacation home is more a seasonal spot near a beach or a lake or mountain. That sort of stuff doesn't steal some middle class family's chances of renting something cheaper by pulling a unit off the rental market.
But I think vacation home can include not just a season spot near a beach or lake or mountain - people buy vacation homes in Mallorca, or Venice, or Provence, or wherever too.
I am not really opposed to them or anything like that, I just wanted to point out there are some harmful effects for some places. The travel industry and the ease of travel is probably more of a concern, because instead of having a family buy a vacation property on a beach somewhere, you've got an entire industry turning that vacation spot into a zoo and for the number of people that do live in that vacation area it hollows it out a bit of any sort of meaning. The whole thing becomes a simulation of a vacation spot.
did it help the problems that are being mentioned here.
There's no reason Martha's Vineyard can't have a bajillion condos on it like it's Maimi except that the people who live and vote there would rather it be expensive than available.
lodging at a ski resort is still very expensive though. I think i makes sense to buy one if you ski ~100 days/year and airbnb out rest of the time. Lots of ski resorts now have summer activities like mtb and hiking too.
and ski resorts usually are sentimental purchases.
AC makes it comfortable if you have it
let me clarify: penthouses and top floor rooms are the best rooms now because they can be kept cool, and have views.
in the past the top floor rooms were the worst rooms because couldnt be kept cool, while also having views.
in older estates, its interesting to see that the lowest ranked personnel were living in areas that are now coveted for the highest ranked personnel. due to their current ability to be kept cool.
But the conclusion I came to years ago was that who wanted to be tied down to a particular location or urban location for vacation. Yeah, it's not cheap but more-so than owning and having to deal with a second home.
One of the (main?) reasons why the Bretton Woods Conference [1] (that determined the post-WW2 financial/currency regime) was held in Bretton Woods, New Hampshire [2] was because no one wanted to be in Washington, DC, in July when it was schedule to take place because of the oppressive heat and humidity that tends to occur in DC during the summer.
[1] https://en.wikipedia.org/wiki/Bretton_Woods_Conference
[2] https://en.wikipedia.org/wiki/Bretton_Woods,_New_Hampshire
A lot of people come to the conclusion that the best way to achieve it is to buy a condo. So you don’t have to do a research project to pick which of the few unbooked places on Airbnb are acceptable before you can go skiing.
But, then again, some people don't notice marginal increase in neurotoxins.
https://en.wikipedia.org/wiki/Crystal,_Gunnison_County,_Colo...
Having a three-season place is pretty common here.
For example, Florida has a lot of vacation homes (8% of the state's housing vs 3% nationwide), but the vast majority of Florida census tracts have a tiny proportion and vacation homes are the majority in a few small areas. In some areas, the proportion of vacation homes seems to follow population density (gulf coast of Florida), and in other areas it follows the _inverse_ of population density (northern Maine.)
What I think would be really interesting is a map of distance to primary home by census tract. Obviously Florida vacation homeowners are mostly from far away and in New England they live closer, but what about all the other areas?
[0] https://www.fastcompany.com/90239274/infographic-did-faceboo...
It is pretty likely that “vacation house” doesn’t include a lot of housing that most people would think of when they think about vacation houses. If something is listed on AirBnb or VRBO, for example, it is almost certainly not included in these stats.
Zoning, as the author points to, is not the issue around those parts.
Most likely investors are setting up phony identities and marking the homes as occupied to claim deductions
Presumably if the residents don’t even live there, then they are massive net contributors to the tax base
The value, though, relies on the idea that some time in the future the asset can be used as something more than an asset to sit on - e.g, people could live there. Currently though, it's unused for that so I think it's fair to call it idle.
If a retired person owns property and sells it, that is income subject to capital gains tax.
If a person is retired but still owns the business or is even still a board member, they’re still working in a sense and gaining shares.
There are plenty of “retired” people who are “working” and have income.
That doesn't seem insane compared to say California with 0.71%?
Granted, there are some working-age people who buy a vacation home with the thought of moving into it permanently a decade or two into the future, but those plans entail a lot of uncertainty (health, closeness to family) and of course once they move, it is no longer a vacation home.
Income tax from progressive scheme nearing 10% to 0%
Sales tax from ~9% to ~8%
Property taxes are hard to pin to a single value, but with housing prices just being lower in general you wind up paying less for similar footage/amenities
While it doesn't mean the observation is fundamentally inaccurate, it's worth keeping in mind that people looking at states with 0% income tax may be coming from a place where they're just getting reamed because work wants them there. If you're not flying under the SALT cap and work is remote friendly it's worth at least looking around.
[1] https://www.sciotoanalysis.com/news/2024/6/25/how-do-state-t...
This just protects your 6 months and 1 day. The other 182 days will likely be subject to tax by the high-tax state.
Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming do not have income taxes. Less than 20% isn't 'many' to me but I realize YMMV.
Millenials are retiring already?
Then figure out a way to get out of income tax.
Finland also has a high amount of vacation homes on lakeshore property, and I would guess that pretty much any area with glacial lakes within hours of population centers will have lots of vacation homes.
It's well known as a major state to retire to, and many of the things that make a place attractive as a retirement destination also make it attractive as a vacation home location. And it is a high population state so when comparing by absolute numbers it would be the most obvious candidate for most vacation homes.
The interesting part is where it looks at percentage of homes in the state that are vacation homes. Florida is high by that measure too at 8.2%, but behind Maine and Vermont which are each over 15%, and New Hampshire at over 10%.
It is even a little behind Alaska (8.9%) and Delaware (8.6%). I bet not many people would have guessed that Alaska has a higher percentage of vacation homes that Florida.
Hawaii is also interesting. It has twice the population of Alaska, but only slightly more vacation homes (31.6k vs 29.2k).
Common sense reasoning: people cannot afford to have their vacation home in Hawaii.
High prices, long and expensive flights.
I’d be shocked if the parcels that Larry Ellison owns on Lanai are classified in a way that would show up as a vacation home. Typically rich large landowners in Hawaii are “gentleman farmers” who (ab)use agricultural tax loopholes.
https://jacobin.com/2023/06/agriculture-property-tax-break-u...
As of 2024, there are an estimated 11.2 million RV-owning households in the U.S., according to Emergency Assistance Plus.
That's more than double the 4.8 million mentioned in the article...and theoretically some households could own more than two. But modulo RV's are also used for work travel particularly when it comes to construction.
Like anything relating to housing and real-estate, it's complicated.