Candy Evans is the guru of real estate in Dallas. She has an uncanny ability to get the inside skinny on the luxury homes celebrities, politicians and the uber rich are purchasing and where they are purchasing. It’ s not just the rich seeking a luxurious second shelter. Many boomers are finding they don’t want to head into their retirement years in the big old ranch house. They’d rather split their time between smaller but decidedly better properties in places they’ve always dreamed about. Evans is so sold on second homes she began a blog in the midst of a down market called Second Shelters. It’s taken off like a rocket. Clearly Candy has an eye for the next big thing!
Karen: What made you decide to start a blog about second homes in a down market when even our luxury homeowners might be feeling a pinch (or are they?)
Candy: Well, Avon, Proctor & Gamble, IBM, GM, and United Technologies are just a few of the companies that were founded during depressions, but I sure am not comparing my little blog to them. It is true that many luxury home owners are currently struggling to keep their heads above water. But many are not. The first Baby Boomers hit 65 this year, and they will live their next 20 years light years apart from the way their parents did. They will sell their larger home(s) and split between two residences. Think about it: their children are more than likely to live in another city, or country, and in order to be near their kids they may have to move. If fuel prices go up, they will want to be in an urban area where they can walk more and ditch the car. And they’ll get a smaller place near their grandkids and then maybe a fun house where everyone can gather to spend vacations, near water, near mountains. So many things are changing in home ownership now, and municipal taxes are going nowhere but up. I foresee the Boomers forsaking the traditional family home (because remember, they built them bigger!) to live in smaller, quieter communities of less crime and lower living costs. And don’t even get me started about second homes south of the border!
By the way: according to the National Association of Realtors, the average second home buyer has an annual salary of $86,000.
Karen: Why should people in the luxury marketplace consider a second home?
Candy: Because homes are so cheap right now. Can they get cheaper? Yes, a little. 10 to 20% max. But that tide will turn and they will appreciate once again, though I have to say that it will not happen in the next 24 months. You should only buy if you can afford to buy. If you can afford to buy, buy now and hold.
Karen: Do we have a lot of second homeowners in Dallas? If so are there certain geographic areas they tend to favor?
Candy: Yes, for some reason – the heat, the topography – Texans like to have second homes. The most popular spots are Colorado, Montana and Santa Fe (which is practically a bedroom community of Dallas). The Texas and Florida Gulf coast, North Carolina, and a few favor Maine, like former President George Bush. Then there are the ranches, and of course the Texas Hill Country, which is hopping.
Karen: What about second homes in the city? For instance do our Dallas owners tend to want a NYC apartment so they can attend the theater, ballet and opera? Is NY a hot second home market for us or should it be?
Candy: Yes, but NYC is so expensive. Only the very wealthy can really afford that. Unless you inherited a place or bought in the 1970’s…when I was a poor Columbia student and should have bought! A lot of Texans own fractionals at places like The Phillips Club.
Karen: Where should people be looking if they are just getting on the second home bandwagon domestically or internationally?
Candy: Domestically. Florida is like Filene’s Basement right now, you can get a home in Gulf Shores, Alabama right now for so little they may give them away next! Santa Fe, the North Carolina coast, Montana, and Colorado are all good choices. Of course Aspen never suffers! Utah is great and oh yes, Phoenix and Scottsdale. Bristol Palin chose Arizona so people are paying attention to that market. I’m very interested in buying south of the border. I think Mexico is a huge bargain but you have to be very careful. I’m not talking about crime; I’m talking about developers. Stick with brand names! Costa Rica, Honduras, Panama and even Nicaragua are coming up on the horizon.
Karen: What about second home ownership out of the country? Do we have Texans that have homes in Paris, London, and the Caribbean?
Candy: A few, yes, and some even live on ships and in Hawaii. A Dallas man is developing high-end lots out in Maui!
Karen: I know for Texas, the second home is quite often a ranch property. So to that end are we in fact, in Texas, often finding a multiple home scenario for our luxury market owners?
Candy: Yes, for the uber rich it is de rigeur to have a beautiful main home, a ranch, a beach place and a ski place. By the way, shared ownership ranches are gaining in popularity for the “middle class” and professionals.
Karen: Do you want to make any 2011 predictions about where the hot spot second home markets will be?
Candy: Of course! The Texas Hill Country, Colorado, Montana, Idaho, North Carolina, Maine, maybe Santa Fe but that place is so controlled, and it’s so hard to build there. Phoenix and Scottsdale, Arizona may do better than Florida. I just love Florida and want a beach house there so badly I can taste it. I think people are scared of all the overbuilt condos and rising insurance costs. West Virginia and The Greenbrier Sporting Club is also very hot, and gorgeous. I also think fractionals will grow – not to be confused with timeshares at all. Why not share a vacation home since you cannot be there all the time?
Karen: Where would you purchase a second or third home?
Candy: We have a vacation family home time-share in southern Maine. We want to build a place in the Texas Hill Country. I LOVE LOVE LOVE San Diego – The Villas at Rancho Valencia, incredible fractional ownership. I think it’s one of the best deals in the world. A ski home in Montana at Spanish Peaks is a perfect complement to Dallas weather because you can escape the heat in August, too --- but if I could have a two bedroom condo on the beach at Watercolor or Alys Beach on the Florida Gulf coast, I would be delirious and have Easter there every single year!