The Spring 2011 survey was carried out in March and is the 19th in a continuing series of twice-yearly surveys that focus on the 11.4 million households that represent the wealthiest 10% of all U.S. households. These households are determined by The Federal Reserve Board based on net worth. The survey was conducted by mail among samples drawn at random, and the questions focus on the future outlook and spending plans of the affluent. The 405 participants in this survey have an average annual household income of $333,000, an average primary residence value of $1.2 million, an average net worth of $3.1 million, and average investable assets of $1.8 million.
About 59% of the affluent say they are not familiar with the concepts of private residence or destination clubs. Familiarity with these types of products is strongest among the younger (59 and under), higher income, and higher net worth groups. Familiarity with these concepts was also identified in the Spring surveys in 2009 and 2007. During this 4 year period, the awareness of destination clubs has increased by 9 points or about a third. Awareness of other products has changed very little.
About 10% of the affluent say they will seriously consider acquiring access to a vacation home during the next 12 months. Wholly-owned homes are the most favored type of vacation home access. Wholly-owned homes used primarily on a seasonal basis are more popular than those used frequently throughout the year. About 2.9% are considering two types of vacation home acquisition, such as a wholly owned or a shared home.
The actual interest in private residence clubs and destination clubs shows strong improvement relative to the results of the 2009 and 2007 surveys. On a relative basis, there is increased interest in access to a vacation home through shared access or fractional ownership as opposed to whole ownership. In fact for the higher net worth (greater than $6m) respondents, there is more interest in both destination clubs and private residence clubs, than in a wholly-owned second home that you use frequently throughout the year.
“The increased interest in private residence and destination clubs may reflect two factors. First, the stock market recovery since the 2009 lows has made the affluent feel better about their spending. Second, the recognition that real estate values do not always go up makes the alternatives to full ownership of a vacation home more attractive.” said Ron Kurtz, President of the American Affluence Research Center.
The full report is available from the American Affluence Research Center website.