In the tech-driven, economic era gone by, investors collected stock options and stock-heavy portfolios like they were going out of style.

They did.

Keeping up with the Jones today means buying a second home.

Based on strong second home purchases in metropolitan areas and the price of second homes purchased, the National Association of Realtors estimates that most second home purchases in the first quarter this year were for investment purchases.

"That's a flip of the assumption that second homes are typically recreational sales, but it underscores the trend in recent years and our benchmark study underscores that," said Walter Molony, spokesman for NAR.

The benchmark "2002 Profile of Second Home Owners", published last November, showed that 78 percent of all second homes were used primarily for recreational use. However, an examination of more recent purchases revealed the percentage purchasing second homes for investment purposes rose from 20 percent in 1999 to 37 percent of second home sales in 2002. Now they may be more than half of all purchases -- if only temporarily.

NAR's 2003 Profile of Home Buyers and Sellers reveals indications that "a majority of second home purchases in the first quarter were investment properties."

"The concentration of second home purchases in metropolitan areas during the first quarter is the reverse of what we see on an annual basis, where most are purchased in resort, recreation or rural areas," said David Lereah, NAR's chief economist.

"This may be a weather effect, but there appears to be a seasonal trend in the location of second homes purchases with winter favoring investment properties in metropolitan areas. In addition, buyers generally have shown a greater interest in investment properties over the last few years," Lereah added.

The 2003 profile also shows that during the first quarter, 15 percent of home buyers were either purchasing a second home, already owned a second home or were buying a new primary residence and keeping their existing property as a second home.

The median second-home price during the first quarter was $150,000, up 6.1 percent from $141,400 in the first quarter of 2001. First quarter second-home prices typically are 12.7 percent below annual prices, another indication that a majority of second homes purchased in the first quarter were investment properties. NAR's bench-mark study showed the typical investment property value is estimated to be 15.3 percent less than recreational property values.

So how can you get the most out of a second home purchased for investment purposes?

Published: July 18, 2003

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Broderick Perkins parlayed a career in old-school journalism into a contemporary digital news service that really hits home. The award-winning consumer journalist, originally from Wilmington, DE, is founder, publisher and executive editor of the bootstrap DeadlineNews Group, a Silicon Valley-based editorial content and consulting service specializing in residential real estate, consumer news and related editorial consulting services. The DeadlineNews Group includes the website, DeadlineNews.com, offering real estate editorial content and consulting services, and its back shop, the Deadline Newsroom, an open house on news that really hits home. Perkins obtained his formal journalism education from University of Delaware and a journalism boot camp, the Institute of Journalism Education at the University of California-Berkeley. He went on to 20 years of service as a daily newspaper journalist at the Wilmington, DE News Journal and San Jose, CA Mercury News. Perkins covered housing on the San Jose Mercury News reporting team which earned a General News Reporting Pulitzer Prize in 1989 for coverage of the Loma Prieta earthquake. He has also produced real estate, consumer and small business content for the Wall Street Journal, Los Angeles Times, RealtyTimes.com, Nolo.com, Better Homes and Gardens, the National Association of Realtors, Homestore/Move and Intuit/Quicken among more than three dozen publications. In addition to managing the DeadlineNews Group, Perkins most recently served as chief editorial consultant for Nolo's Essential Guide To Buying Your First Home, Nolo, and writes real estate television scripts for RealtyTimes.com.