Dear map makers who show us by-state break-downs: normalize by the population. The first map tells me this: New York, Florida, and Texas have large populations.
Where are vacation homes located in the US?
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Re: Where are vacation homes located in the US?
#32I suspect the "vacation" homes on Manhattan are really mostly empty luxury units for foreign rich people to park money in the US. "Billionaires Row" near Central Park is half empty for just this reason.
Shower thought, maybe bitcoin is actually good for the environment, if it replaces even more wasteful ways of trying to park wealth.
It’s not really “parking” wealth since property taxes are still collected every year on these properties, which fund other city programs, unlike other asset classes like stocks and crypto.
Presumably if the residents don’t even live there, then they are massive net contributors to the tax base
Re: Where are vacation homes located in the US?
#33The article cites the availability of air conditioning as a major factor in vacation home trends. Prior to AC, escaping heat was the main purpose to have a vacation home. That’s why so many vacation homes are near old major cities like Philadelphia, New York, Boston, Chicago, etc. In the summer, families with money escaped to the mountains or the beach, where it was much more pleasant during the hot months.
I would guess that another huge factor has been the decline in the real cost of air travel. It’s now cheap enough that people with money can reasonably expect to fly somewhere for every vacation they want to take. You don’t need a condo near the local ski resort if you can fly to a different one every winter.
In fact, I feel buying property in one vacation spot is starting to look more like an anchor than an escape hatch. Keeping capital in securities instead is more liquid and less expensive (stocks don’t have roofs or plumbing). Let someone else own the hotel or AirBnB or VRBO. I’ll fly in and rent it just for the vacation. This mindset may partially explain why vacation home ownership has not “kept up” with the growth in real wealth.
Re: Where are vacation homes located in the US?
#34Earlier quoted context omitted.
That's the TL;DR for the least interesting part of the article since most would expect Florida to have the most. It's well known as a major state to retire to, and many of the things that make a place attractive as a retirement destination also make it attractive as a vacation home location. And it is a high population state so when comparing by absolute numbers it would be the most obvious candidate for most vacatio…
> Hawaii is also interesting. It has twice the population of Alaska, but only slightly more vacation homes (31.6k vs 29.2k). Common sense reasoning: people cannot afford to have their vacation home in Hawaii. High prices, long and expensive flights.
Yes but it's Hawaii. Common sense reasoning only lets you conclude that rich people have vacation homes in Hawaii, not some specific percentage relative to the rest of the states. I bet it if the math was done based on vacation land area, Hawaii would come up near the top, given Lanai. Probably places like Montana too.
Re: Where are vacation homes located in the US?
#35Earlier quoted context omitted.
This is not even logical, retired people don't have incomes. Anyways, they get them with insane property taxes.
Not quite. Retired people have deferred income in IRAs and 401(k)s that can be claimed at their leisure after 59.5 years old. So if you deferred taxes from a high tax State and then get the income in a no-tax State, you saved on taxes.
True but generally this is lower than their W-2 was.
Re: Where are vacation homes located in the US?
#36The article cites the availability of air conditioning as a major factor in vacation home trends. Prior to AC, escaping heat was the main purpose to have a vacation home. That’s why so many vacation homes are near old major cities like Philadelphia, New York, Boston, Chicago, etc. In the summer, families with money escaped to the mountains or the beach, where it was much more pleasant during the hot months. I would g…
This is a win win win for all involved, owner, renter, and Airbnb. I converted stocks into a vacation home on puget sound and rent it out when we aren’t using it. Demand is high enough that we don’t need to rent it out months in advance so we still feel like it’s mostly ours and we’re not just another guest fitting into Airbnb’s schedule.
To your point I liked the liquidity of equities but it has been nice to do something with it beyond just watching a number in a spreadsheet. If we want a change in scenery it’s a wash to rent our own place out and stay in another.
Re: Where are vacation homes located in the US?
#37If I got a vacation home it would probably be in Puerto Rico. Not part of the analysis.
Then figure out a way to get out of income tax.
Re: Where are vacation homes located in the US?
#38I'd guess the ones in Alaska are rentals
for seasonal workers. I understand there are tourist areas that are largely unpopulated in the winter and populated mostly by seasonal workers in the summer (some of whom work in Hawaii the other half of the year).
Re: Where are vacation homes located in the US?
#39The article cites the availability of air conditioning as a major factor in vacation home trends. Prior to AC, escaping heat was the main purpose to have a vacation home. That’s why so many vacation homes are near old major cities like Philadelphia, New York, Boston, Chicago, etc. In the summer, families with money escaped to the mountains or the beach, where it was much more pleasant during the hot months. I would g…
> You don’t need a condo near the local ski resort if you can fly to a different one every winter.
lodging at a ski resort is still very expensive though. I think i makes sense to buy one if you ski ~100 days/year and airbnb out rest of the time. Lots of ski resorts now have summer activities like mtb and hiking too.
and ski resorts usually are sentimental purchases.
Re: Where are vacation homes located in the US?
#40Earlier quoted context omitted.
Not quite. Retired people have deferred income in IRAs and 401(k)s that can be claimed at their leisure after 59.5 years old. So if you deferred taxes from a high tax State and then get the income in a no-tax State, you saved on taxes.
True but generally this is lower than their W-2 was.
The point is that you finally have control of where are when you realize the income.