Is a second home still a second home if you buy it first? That’s the question posed by the New York Times last September about a niche trend in upper class real estate. Even well-off New Yorkers who have budgets upwards of $600,000 struggle to find affordable housing in the city’s literally sky-high housing market. There’s not even much unaffordable housing left. Basically, anyone not in the one percent is left with a simple choice — rent or move away.
Some New Yorkers are opting to split the difference, keeping their rental unit but purchasing a vacation home outside the city. That’s why New York couples like Stefan Weisman and Sean Mills are purchasing their first home well outside the bustle of New York City, picking up a quiet home in the Catskills.
But does this trend hold outside of Manhattan and Brooklyn? If publications like Realtor.com, Mainstreet.com, and Men’s Journal are to be believed, absolutely. In fact, despite the attention gained by the New York Times piece, Men’s Journal spotted the trend in March 2014, writing about young professional who pay rent in urban centers but flee to lake property, rural farmsteads or vacation homes on the weekend.
In fact, there’s an old joke that by the time the New York Times spots a trend like this, it’s already old news. Although the housing market may never return to 2007 boom-year levels, prices have recovered in recent years. And in particularly in-demand housing markets like San Francisco, Washington D.C., New York City, and Denver, it can be extremely difficult for middle class households to find a home.
To make matters worse, this week Market Watch reported that the number of foreign buyers snatching up U.S. homes in all-cash purchases has tripled in the last 10 years, decreasing supply and boosting prices.
“Foreign cash buyers have helped to accelerate U.S. home price appreciation over the past few years given that these buyers are often not as constrained by income as local, traditionally financed buyers,” said Daren Blomquist, vice president at RealtyTrac.