Rich Folks Club Goes Bust

Kudos to the Helium Report for breaking the news of the bankruptcy of Tanner & Haley, the destination club. It filed to reorganize under Chapter 11 in July. The club gave four reasons for its problems: "costly short-term leases, memberships at extremely low annual dues, various ventures "that ultimately proved unsuccessful," and "increasingly stiff competition."

Breaking Ground on "Affordable" Ski Condos

If I wanted another Colorado vacation condo in the mountains, and especially if I wanted an easy trip from Denver, I'd run, not walk, to learn about the new buildings at Winter Park that Intrawest breaks ground on today.

Fraser Crossing and Founders Point will have 194 units. Prices: from about $250,000 to $1 million. About $50 million worth of the units have sold, according to the resort.

A local housing official says the areas should "attract more of a market that is middle class rather than just exclusive."

Battle Mountain May Drive Real Estate near Vail

"Local real estate experts suspect the development of a private ski resort on Battle Mountain" not far from Vail, Colorado, "might drive up property values in Minturn," the town at the base of the proposed resort, according to a story in the Vail Daily. But the paper notes that earlier resorts developed by the same Ginn Company did not do much for real estate prices Florida and North Carolina.

You Paid Too Much

If you just bought a second home in Naples, Fla. you probably paid nearly double what the property is really worth.

A Barron's study based on info from National City, a Cleveland banking and mortgage outfit, says homes there are overvalued by 96 %. Second on the list is Port St. Lucie/Fort Pierce, Fla. Top 10 overvalued cities include Tucson, Prescott and Phoenix in Arizona; Bend, Ore.; Napa, Calif.; Barnstable, Mass.; and Ocean City and Atlantic City, N.J.

Higher Ground

Some months ago, I told about my sister and brother-in-law, who lived in New Orleans and had evacuated to their second home in Massachusetts. Now, says a story in the New Orleans Times-Picayune, real estate specialists are reporting that people "from throughout the New Orleans area are looking at second homes above sea level in rural Louisiana and Mississippi -- or even farther out of state -- so they'll have a ready refuge if another Katrina strikes." Popular spots: Hattiesburg, St. Francisville and Woodville, Miss., Alexandria, Lafayette, Covington, Hammond, and Picayune, La.

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Bubble Softens Parts of California, Florida

It't tough to generalize about the second home "bubble." In its cover story this week, Barron's quotes Robert Toll, CEO of big homebuilder Toll Brothers, calling the U.S. market "very spotty." In some of the markets where Toll builds golf-course and lake communities, like Palm Springs, Calif., Delaware and southwest Florida, demand has softened. The company, however, has had to offer incentives in only two resort communities out of the 15 it owns. "If you've got the right stuff, people still clamor for it," says the CEO.

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Warning: Buying Investment Property May be Addictive

According to the National Association of Realtors, 35 percent "of all investment-home owners said they were planning to buy another home within two years. For those who currently own four or more investment units, 64 percent said they planned to buy another property within two years, and 17 percent said they planned to purchase five or more additional properties." Even though the air is leaking out of the housing bubble? I wonder. And what happens when interest rates hit 9 % or so?

New Gold Rush in Sierras

California mountain homes in the Central Sierra counties of Tuolumne, Calaveras and Mariposa are luring buyers priced out of other regions, according to the Modesto Bee. It quotes Escape Homes' David Hehman: "Vacation home buyers want beautiful and natural areas, and the Central Sierra is an emerging destination. The attraction there is the natural beauty and affordability." Home prices: $350,000 or more, with many priced above $1 million.

Categories: California,, Sierras

Investor Frenzy Could Boost Apartment Rentals

With home prices out of sight (and reach) in many areas, this will be the year that the apartment market surges, says real estate consultant John Burns. Why? Here are factors he cites:

Mortgage Rates - Falling mortgage rates over the last 6 years have created a tremendous boom in for-sale housing.

Lack of Construction - Apartment developers became condo developers because it made more financial sense.

Condo Conversions - Condo conversions also took apartment units out of the market.

Rising Homeownership - With investors renting them so many homes they have bought lately, the nation's rental stock has dwindled.

Burns also thinks fast pace of condo conversions means market could become flooded and those condos will land with a thud in the rental market.

Vacation Home vs. Stocks

It's a tough call. See how MONEY Magazine weighs the debate over whether to try to catch what may be the last phase of the
Second-home boom.

Top Picks for Second-Home Investment Cities

Here's Bankrate's forecast of 10 cities where prices and values should continue to rise. Hint: not one is in Florida or Nevada.

How to Survive Being a Landlord

I always pay attention when columnist Bob Bruss recommends a book. Lately, he's raving about The Landlord's Survival Guide, by Jeffrey Taylor. "If you own residential rental property, or are thinking about investing in rentals, you will benefit" from it, says Bruss. "Known among residential rental owners as 'Mr. Landlord,' Taylor has created a business of helping landlords prevent costly management mistakes." Bruss says this book is geared to novices and/or part-timers.

NAR: Vacation Homes Defy Softening Market

"In 2005, sales of vacation homes increased 16.9% from 2004 for a record 1.02 million sold, according to the National Association of Realtors, according to the WSJ's RealEstateJournal Blog .

April Showers on Once-Hot Markets

Be nervous. But not terrified. The headline in today's Wall Street Journal -- Hot Homes Get Cold -- is scarier than the article. Essentially, it says sales in some Florida and other investor-powered markets are off --"as much as 47% in Naples," for example. Read farther and you'll find comfort in the relative strength of most second-home hotspots, which are simply cooling a bit. Call it April showers, not a raging flood.

But is the Buying Spree Over?

The headlines today seem to say it all - second homes (28 % for investment, 12 % for vacation homes) account for a full four out of every 10 home sales in the U.S. But buried below the top paragraphs is a warning -- those figures are for 2005... And David Lereah, the National Association of Realtors honcho who has been tracking the boom for years now, says he thinks the trend has "crested." He expects sales in 2006 to dip by 10 % -- as "speculative investors" who are in the game only as flippers leave the market. The good news: the vacation home market -- as opposed to investor-driven market -- will stay strong

Latest figures: Second Homes 40% of Market

It's the top story today in USATODAY.com -: "Americans snapping up second homes - as investments or vacation properties - accounted for four out of every 10 sales of existing homes last year, a record that helped drive the real estate market to new highs, according to a report being released today by the National Association of Realtors.

"New Way to Spend Lots of Money"

That's how Los Angeles Times describes hybrid condo-hotels. Among the 22 projects -- luxury hotels with rooms or suites now being sold in blocks of a week or a few months a year -- in California: Hard Rock Hotel San Diego (rooms start at $400,000), and Terranea Resort, Rancho Palos Verdes, (casitas and villas start at $1.9 million.)

Indulgence, not Investment

Is now the right time to shop for a second or vacation home? "Only if you expect to keep it for many years and view it as an indulgence rather than an investment," says Jeff Brown in the Buffalo News. Sales of existing homes fell 2.8 % from December to January, the fifth straight month of falling sales. Home sales were 5.2 %below those of January 2005, says the National Association of Realtors. Brown says this confirms "stories about investment properties sitting empty while speculators who'd hoped for quick turnarounds slash prices in the absence of buyers. Second homes and investment properties are hit hardest in a cooling market because people don't need them."

The Sky Is Not Falling, Says Fool

Vacation Homes: Profit Castles? - Yahoo! News: "Investment prognosticator Harry Dent has forecast that vacation, resort, and retirement homes will continue to be real estate hot spots. Peak baby boomers -- aged 47 or 48 -- will buy vacation homes until the end of the decade. A second surge -- boomers aged 58 to 65 -- should carry the trend up through 2014 or so." (from a "Motley Fool" column)

Too Hot Not To Cool Down

We keep hearing about the inevitable cool-down in real estate prices, but where? Local Market Monitor LLC of Boston-based is making notes and taking names: Tops on its list of overvalued areas are two second-home favorites:

* Santa Barbara, CA by 86%
* Naples, FL by 72 %

What do the numbers mean? These spots had most appreciation over last five years-- and thus are most likely to drop in value.