Baby Boomers Snap Up Vacation Homes
at Record Rate

Fifty-seven percent of second homes and vacation properties are now owned by baby boomers, according to a new study by the National Association of Realtors®.

Baby boomers are those Americans born between 1946 and 1964. They are the largest segment of the U.S. population and 25% now own more than one piece of real estate. The percentage may, however, be higher in the Destin real estate and South Walton markets, where many baby boomers make their second home destination because of its close proximity to major urban areas.

According to the study, which surveyed 2,000 baby boomers, 80% own their own homes and an over-whelming majority of 96% believe owning a home is a good financial investment. Home ownership throughout America is now at it’s highest level in U.S. History at 69%.

More than two-thirds of those baby boomers, who do not own a second home or vacation property, indicated their number one priority is to own an investment property or vacation home in the next three years.

Forty percent of those surveyed said they intend to make their vacation home or seasonal property their primary residence eventually.

"Some boomers will take advantage of generous capital gains exclusions from their taxes when they sell their primary residence," said Chief National Association of Realtors real estate economist David Lereah. "And then place themselves in the position of being able to convert a vacation home into their new primary residence, which would later become eligible for the same tax treatment," he said.

"Then, if their needs change in the future, they’ll be able to take the capital gains tax break after they have lived in that home as their primary residence for two out of the five previous years. It becomes a great way to build and protect a nest egg."

Baby boomers are also the wealthiest generation in the nation’s history. Some 43% said they are financially comfortable, but 37% said they have just enough to get by. Many blame their own poor spending habits for their down falling. Of those who are financially comfortable, some 74% said they worked more than 60 hours a week at their jobs.

However, the study also indicated some surprising results. Only 14% expect to receive a sizeable inheritance, which discounts the theory that more Americans are inheriting wealth. The study signals a reversal in trends. Americans were inheriting large wealth until the past three years, according to sociologists, who study the nation’s wealthiest families.

More of the nation’s wealthiest families are now spending their wealth before they die. At the same time more than half of all boomers surveyed said it is important to diversity savings into a variety of investments.

An amazing 59% of boomers said it was not likely that they would work beyond the time they qualified for social security benefits. Most surveyed said they expected to stop working by the age of 65.

Sixty percent said their perfect location to retire would be in a rural area or a small town. Only 12% elected a major urban area, and only 38% said they wanted to be close to family.