Despite the recession, increased unemployment, and ups and downs on Wall Street, second home sales have risen substantially in the past few years.

Often purchased as vacation or retirement properties, second homes clocked an estimated 415,000 sales in 2000, up 10 percent from 1999 according to the National Association of Realtors (NAR). The year 2000 estimate is up 40 percent compared with the 296,000 second homes sold in 1995.

Why so many second-home purchases?

The economic expansion during the past decade has created extraordinary equity growth in primary residences and bullish stock market returns. Also, the Taxpayers Relief Act of 1997 allows qualifying owners to keep more of their profit when they sell a prime residence -- money often used to purchase a replacement home as well as a vacation property. And sometimes, of course, the vacation property is the replacement home.

No less important, it's become more practical to own a second home. The Internet, cell phones, and fax machines allow many owners to work from any location, including by the slopes or near the beach.

NAR's "Home Wealth Effect Survey" shows that a typical owner has $50,000 in home equity -- $100,000 for households earning more than $75,000. Baby boomers aged 50 or older have still more money on the house -- $80,000. In some California and New England areas, home-earned equity is several times higher than the national average.

"It's really the middle income where the bulk of the baby boomers are showing a demographic demand that's very strong," said Walt Molony an NAR spokesman. In some cases, he says, second home ownership is "designed to diversify a totally stock-based portfolio with other forms of more secure investments,"

"In the past, vacations homes didn't appreciate very quickly, but that's changed. Many of the most desirable locations are fully developed. Mid-Atlantic coastal prices have doubled in the past four years," Molony added.

In many cases, vacation home owners get the same mortgage interest tax write-off they get for their first home and there's even some tax-free income available, provided the vacation home isn't rented for more than 14 days in any calendar year -- for details be certain to speak with a tax professional.

Historically, vacation home buyers most often are simply after the good life -- an A-frame on the slopes, a cottage on the beach, a cabin by the lake -- a place to get away from it all. The house may become a retirement home, an inheritance for the kids or even a status symbol.

A growing number of second-home purchasers are buying in metropolitan urban areas so they can have quick access to theaters, museums, and shopping. In general, however, no matter what state or region they choose, buyers most often seek lakeside, beach front, mountain and other resort communities, says Molony.

How can you find a second home? Several strategies stand out: