The Second Home Muse

Another Second Home Reason

One of the reasons I love my job is that there is no end to the discovery of new information about second homes. Recently I wrote about buying a second home in a college town, and gave all the good reasons to do so. But a recent news article forwarded to me by a colleague, pointed out that I missed one very hot set of buyers: College Football fanatics. Okay, they don't have to be fanatics, but certainly dedicated alumni at the least, and, fanatics at best. College football is a huge draw, and for many locations, finding a place to stay during the home games is next to impossible. Capitalizing on this, new condos are being built just for that purpose, and the fans are buying them up. And certainly, slump or no slump in the housing market, there will no end to the devotion of the football fans. Yet another proof that the second home market will remain a really good thing for everyone. (And in case you are wondering which college towns are in for football, check out Tallahasse, Florida; Athens, Georgia and Louisville, Kentucy, for starters. Now, let's see how well the teams do! )

Vacation Home Blues

I really didn't want to write any more about the housing numbers, even if the 30% drop in sales in my own state, California, was the biggest dip in sales volume since 1982.  And I didn't want to write any more about the housing decline and its positive effect on the stock market, as investors move more money into equities. And I really didn't want to write any more about the housing market continuing to dip for a little bit longer. So, I won't.

At the risk of emulating my childhood hero from Mad magazine, saying "What, Me Worry?" I do feel that someone, and it might as well be me, continues to point out why we have a vacation home market. In very practical terms, if you have a family that takes frequent vacations, owning a vacation home is just good sense (cents.) Hotel costs are not the only reason, though they are a really big one. There's also the creating of family traditions, there's the ability to come and go when you want, high season or low, and there's the ease of inviting friends, relatives, kid's friends, at a moment's notice.  Vacation homes are part of the American dream, almost as much as owning a first home. Whether it's a little cottage at Lake Tahoe, a condo for the winter in Florida, or that cozy trailer on the lake in New Hampshire, I personally feel we are not about to change our vacation habits. So, I have the 'vacation home blues' as all the news is about what the market is not doing, instead of what we are all still enjoying and doing very well. Anyone want to cheer me up? Just send your experiences of having a vacation home, and confirm that indeed, you are not about to dump it now. Thanks.

Housing Statistics: Keeping Score

Lest you go elsewhere for the best real estate news, we thought we'd include the latest Housing stats, which of course are front page everywhere. The median price for the nation was down, but here's the blow-by-blow:

Where:                Median Price:        Up/Down from last year:
Northeast:          $271,000                Down 3.9%
Midwest:             $176,000                Down 1.1%
South:                  $184,000                Down 2.6 %
West:                   $345,000                Up .3%

Funny thing about the West, isn't it? It's kind of like trying to kill a snake...it just wriggles away and grows another tail. Oh well.

Second Homes, Affordable Housing

Call it synchronicity, or whatever you want, but it was neat to pose a dilemma in yesterday's blog and find a solution today. Yesterday we talked about needing affordable housing in the coastal county of Lincoln, Oregon, where most homes are second homes. Today, I read of a very novel solution, from the 'other' coast, the Hamptons in New York. A new housing complex under construction in Southampton has 36 market rate units and 14 subsidized workforce units. The market rate, 2,000 square feet flats are selling out fast to Manhattanites for their second homes, going at about $700k upwards. The affordable housing will sell for $185,000 to $325,000, depending on the families income, and will be available only by a lottery administered by the local housing authority.

I'm quite impressed to read about such a unique solution. Three local builders are behind the development, modeling how the housing industry can cooperate with local needs and  make a difference in their community. Hats off to Southampton and the builders, Charles Mancini, Tom Datre and Anthony Panza.

Read more about second homes in the Hamptons.

Oregon's Second Home Dilemma

Second homes can be a great boon to an economy, yet sometimes, too much of a good thing can have unforeseen impacts. An article in an Oregon newspaper highlights one such dilemma. In the central coast of Oregon, the little county of Lincoln hugs the coast, going inland at most 15 miles or so. And, the coast is coveted for second (or even third) homes, as we all know. However, Lincoln county also wants to create affordable housing and  deal with the homeless in its borders, and solutions to both of these problems becomes impractical when all the land prices are driven up by second home buyers. The county is in a tough place...it loves the ability to host second home owners, and, it knows it has an obligation to take care of the less fortunate in its community.

Their second home statistics are almost staggering. The county issued permits for 1,000 new housing units in the past year, while the population has grown by only 100, pointing to a huge increase in second homes. Even without the new permits, 30 to 40 % of the current housing stock are already second homes. And there's been almost a 35% housing price increase in the area, with no signs of a slowdown.The good news is that the county is committed to thinking out of the box to house the homeless while keeping the boon of second homes.   We say, 'good on ya,' Lincoln, for stepping up to the plate and taking care of all your community needs. And...good luck. When you've got coastal land, you've got tough choices.

Check out housing in the Lincoln Area.

Guess Who Else Buys Second Homes

I love second home news that makes me laugh. This item from Texas got an out-loud chuckle. Guess who needs to buy a second home? The members of the Texas legislature, it seems. Apparently, the number of days they need to spend in Austin exceeds the original (1800's) idea of a part-time citizen legislature. So many of them rent or buy second homes in Austin in order to be able to serve.

However, the part that made me laugh was this: it turns out that according to the Texas campaign spending laws, the legislators are allowed to use campaign money to pay rent to their spouse to cover their Austin housing, as long as the spouse holds the title separately. Well, that made me smile, especially when the article pointed out the number of current legislators who actually pay rent to themselves, as they  hold title on the property. Hmm. Seems to me there's a good second home market to be had here in Austin, now that the cat's out of the bag. On the other hand, since these guys only make $7,000 plus a year for their service, plus per diem, they might not be able to afford too much, so don't buy something too big.

Housing Market Forecast

You have to hand it to David Lereah, economist for the National Association of Realtors. He's not afraid to go out on a limb. I guess that's what comes with being the one most in touch with numbers and facts, instead of fears. A New York business article reports that at a recent conference, Lereah forecast that the housing market will rebound in three to six months in places that weren't overheated to start with. Of course, that gives him some wiggle room, but still, it's an interesting observation. His claim is that the further the prices drop, the more buyers want to get in, creating an upsurge in the market.

I like his optimism, but even more, I liked a quote from the conference by a New York realtor, saying, "This isn't a new market. It's a regular market that we haven't seen in a few years."  For those who are new in the real estate scene, that point of view is well worth remembering... we've been here before, and we'll be here again. As my local teen would say, Chill...

On-Line Real Estate

It's a no-brainer to understand my commitment to the Internet as a major force in the real estate market.  EscapeHomes.com has certainly proved the premise for the second home buyers and sellers. However, with a soft market in general, what will happen to on-line real estate?  An informative article in Red Herring discusses the future for Internet real estate. The article offered these interesting facts:

- 77 percent of home buyers do online research
- 61 percent of agents still don’t advertise on the Internet

In essence, in a buyers market, the Internet will only grow, and with it, agents will of necessity migrate their adverstising dollars. At the same time, in a buyers market, sellers will look for ways to cut costs, and some of the Internet sites offer reduced commission rates, and more economical adverstising rates. It seems that there will continue to be a necessity for both channels -- the personal agent who helps facilitate the sale, and the web site that can offer instant, conglomerated information that buyers want. Real estate buying will only get better and easier, which is good for everyone, don't you think?

Wise Investing

In the second home market, it's always helpful to have a second reason for buying a property, in addition to the investment. For some, it's to have a vacation place. And for others, as a recent Tom Kelly article on Inman points out, it might be to house your college-age kid off-campus. Tom has some great tips in the article, and points out that when the kids move on, you can get rid of the house/condo and get something you really want to retire in.

While I agree with everything Tom says, I'd add one point: Know when to get out. My friend got a townhouse for her son's school years, and as he moved on, she kept it as a rental. However, what she didn't watch closely enough were the property values. In many college areas, there is often an influx of newer developments, because housing is always in short supply. By the time she was ready to sell, (tired of dealing with the undergrad turnover), not only had the market dropped in general, but, there were so many new houses, her condo was just worth less. So she just about broke even.

So yes, college towns are great, and yes, like everything else, don't assume anything, especially not future prices! Thanks, Tom, for a great article. Read more:

Back to School: The latest in Retirement

Retire to a College Town

MLS Goes Green in Portland

If buying a home that meets current 'green' standards is a priority for you, consider looking towards Oregon, and the Portland area in particular. The Oregonian, their local newspaper,  reports that the Portland area MLS will now allow certified users to search for homes according to the green criteria, just like you can search by price or zip code. This makes Portland the first metropolitan area to do this. Portland has long been a leader in environmentally sound housing, cited in 2005 by the Sierra Club for its develpment in the Pearl District. Adding this search criteria to the MLS is yet another first for them.

For more information about finding, buying or building an environmentally sustainable second home, please see our library of articles on Green Buildings.  And keep up the good work, Portland realtors!