The National Association of Realtors (NAR) survey showed vacation home sales hit a record 1.07 million in 2006 representing 14 percent of all homes purchased last year. Sales of luxurious shared ownership homes showed a similar trend according to Ragatz Associates.

Nevis in British West Indies

"The rise in vacation-home sales is based on strong demographic and lifestyle factors, with only modest interest in renting their properties to others," said David Lereah, NAR's chief economist. "The demographics favor vacation-home sales because large numbers of consumers are in the prime buying ages, and buyers want recreational property for personal use - investment is a secondary consideration," Lereah continued.

The typical vacation-home buyer in 2006 was 44 years old, had a median household income of $102,200, and purchased a property that was a median of 215 miles from their primary residence; 42 percent of vacation homes were closer than 100 miles and 32 percent were 500 miles or further.

The results of this survey compare well with the results from the Ragatz Associates survey on sales of destination clubs, private residence club and fractional property. Overall the luxury shared vacation home market grew 7.8% in 2006 with the strongest growth in private residence clubs.

The typical luxury shared vacation home buyer has a higher household income than for the average vacation home buyer. In one recent Ragatz survey for a specific private residence club the median income was $160,000.

The NAR survey showed vacation-home buyers plan to keep their property for a median of 10 years, which is the period we use in the financial comparison of destination clubs to vacation homes.

A surprising 55 percent of vacation-home buyers in the NAR survey said they were likely to purchase another property within two years. In contrast, several destination clubs tell us that new members end up selling their vacation homes once they join the club, and one of the prime reasons reported for joining a private residence club is not having the maintenance and upkeep hassles of a fully owned second home.

NAR's 2006 Investment and Vacation Home Buyers Survey was conducted in April 2007. The Ragatz survey was conducted in February 2007.



Image of Nevis Home, BWI, courtesy Ultimate Resort

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