This year's record-breaking economy is not only creating the best real estate market in years, it is also favoring the second home market.

Not only do your clients have more income and better job security according to government statistics, they are moving up and trading up to bigger and better homes, says the National Association of REALTORS®. These moves are also supported by the Tax Payer Relief Act of 1997, which improves the feasibility of property investment and increases the capital gains ceiling for home sellers, among other advantages.

Favorable economic conditions are also raising consumer confidence, and increasing the likelihood that your client will be more willing to look at vacation or second home properties than ever before. So if you don't suggest one first, someone else possibly will.

Your client may also be part of a demographic that is driving the second home market. Baby boomers, who are turning fifty at the rate of one every seven seconds, are the largest consumer group in the nation. They are also the wealthiest. Economists predict that the Baby Boomer will spend more on resort properties, second homes and hotels than any other group before it, because of their desire to travel and enjoy their wealth.

One clue to knowing if your client might be open to considering a second home is their desire to scale down to a smaller, low-maintenance luxury home. At the height of their careers, Boomers are pushing through the child-rearing years. Many have children about to graduate from school or already graduated. They don't want to lose their current level of comfort, they simply want to lower maintenance responsibilities to enjoy their new freedom. This signals a desire to pursue other interests such as travel and leisure.

And younger boomers may have need of vacation homes because there are children still at home. They may have teenagers and younger children at home who would enjoy the activities offered by a waterfront home, cabin in the woods or golf resort property. The family may enjoy the special bonding that takes place at a special getaway.

You can add to your clients' quality of life by suggesting that they consider resort property that complements their interests. Find out how they want to live as the years go by. Will they stay in their present home? Would they be interested in a vacation property that can become their home in retirement some day? What are their interests? How do they currently spend or wish to spend their leisure time?

If you know your client is an avid golfer for example, ask where they like to play on vacation and do some checking in some of those better known resorts. Most resorts rely on permanent residents and welcome investment in homes. Make a few calls to the resort development and get comparables and other information on the property. Find out what the resort has planned five, ten, fifteen, twenty years in the future. Also find out what other interests your clients and their family may have that would complement a golf resort. A great number of golfers enjoy fly fishing, so a golf resort situated near a mountain or river would be more ideal than one in the desert.

Offer to accompany your client on an excursion to look at the best properties available in their favorite area and then sit down with them to work out possible purchase and maintenance costs.

If a resort or second home purchase is a slight stretch for your buyers, offer to help them get information on leases and rentals in the area which can help offset costs when the property is not in use. This would also help make the bottom line of maintenance, repairs, and interior design costs that much more attractive.

By bringing up the topic of a second home, you are doing your client a tremendous personal service. They may be thinking of a second home already, and your offer of help could just be the incentive they need to start looking. They will appreciate your efforts to help them get the most out of a second home environment.

If you clients aren't quite ready, offer to send them information on areas of interest periodically. They will enjoy the information when they get it, and eventually, they will call.

According to Christopher Cain, author of Road Map to Your Vacation Property Dream, published in association with Coldwell Banker® Real Estate Corporation, you and your client won't be looking a moment too soon. He says the Boomers, by their sheer numbers will create an unprecedented demand for vacation property over the next twenty years. "The best time to buy is before this huge demand has caused an increase in vacation property prices."

Cain recommends, "Don't buy vacation property as an investment. If it appreciates in value, fine. That's a bonus. But investment potential should not be your primary reason for purchasing. Buy the property because you truly want to own it. Buy it because you want to spend your vacations there. Buy it because you, your family, and your friends will enjoy it."

Published: August 19, 1998

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