Where the Nation Vacations: The Hottest Markets for Second Homes

As summer kicks into high gear, Trulia is taking its regular look at vacation areas. This year we’re digging into which vacation hot spots are becoming more popular for second homes, and which are being ditched in favor of sandier beaches. We also looked into where people from the largest 100 metros are vacationing on the cheap and where they are spending big.

In addition to looking at the most searched vacation zip codes[1] nationally, we also used U.S. Census and Trulia search traffic data to create a list of the areas that are turning into vacation retreats (or into bigger vacation areas) at the fastest rate and those that have stabilized or even seem to be moving the other direction. We found:

• Since our last look at the top 20 vacation-home destinations three years ago, the three most expensive areas – Harvey Cedars, N.J., East Hampton, N.Y. and Nantucket, Mass. – have dropped completely off the list. All of the new top 20 most searched areas have a median listing price of less than $600,000.
• Locations in and around Myrtle Beach, S.C., and Florida dominate vacation-area home searches even more now, making up 9 of the top 20 places, up from 6 of the top 20 three years ago.
• McGaheysville, Va., and McCall, Idaho, are among the top hot-spot places that have added vacation properties and rapidly increasing search interest from the previous year.
• The most expensive of these growing vacation areas is Vashon Island, Wash., near Seattle, which had a median listing price of $529,000 during the past year.
• Priced out: vacation destinations scoring the lowest in our hot-spot ranking were 31% more expensive on average than the places at the top of the list. These more expensive places included areas in the Hamptons, N.Y., and the Florida Keys.
• People from more northern, colder cities consistently search for homes in vacation areas that are further south and warmer as searchers from cities such as Chicago, Indianapolis, Ind., Akron, OH, Detroit, Mich., and Buffalo, N.Y. all have several Florida and Coastal-Carolina search destinations in their top 10. Those who are already living in warm climates are either searching for vacation homes in other warm areas or in the mountain areas such as Albuquerque, N.M. El Paso, Texas, Austin, Texas, New Orleans and Birmingham, Ala.

While not the most searched vacation areas in terms of raw volume, these are the areas that rank the highest when considering a combination of year-over-year change in search interest and an estimate of how quickly the proportion of the overall housing stock is shifting to seasonal or occasional use.

[1] Vacation home destinations were identified by zip codes. For the purposes of this report we have identified the closest town, city, or in some cases, county. Zip codes can be found in the tables and in our downloadable spreadsheet.

On the contrary, if you look at the areas that scored the lowest in our hot-spot ranking, median listing prices are roughly 31% more expensive than areas at the top of the list and these places are seeing a falling share of vacation properties and mostly flat or falling search interest. Places like Islamorada, Fla. and Baldwin, Ala., both make this list as well as South Padre Island, Texas.

Comparing this list to a list of the most-searched vacation zip codes based on raw search volume, the only place that is also on our hottest list is the area near Kissimmee, Fla. The coastal edge of Baldwin, Ala., and Gatlinburg, Tenn., on the other hand, while still on the most-searched list, also show up among the lowest scoring hot-spot areas because of declining search interest and flat or declining vacation properties.

If you look at the top 10 vacation destinations that are being searched the most from each metro area and what the high and low median price points are among these areas, you get a sense of where locals who can spend big are heading and where those on a budget can get away.

While the most popular vacation destination for New Yorkers is East Hampton, N.Y., based on search activity, the most expensive go-to spot is the Southampton, N.Y., area, where the median listing price has been $1.95 million during the past year. Their least expensive go-to spot is the Poconos Mountains region, near Bushkill in Eastern Pennsylvania. The median listing price during the past year in this area has been just over $81,000, less than 5% of the median price in Southampton.

San Francisco residents are searching, first and foremost, in Truckee, Calif., where the median listing price for a for-sale home has been $577,115 during the past year. This compares with a median listing price of $1.65 million in Carmel-By-The-Sea, Calif., south of Monterey, Calif., which is the most expensive vacation area that is frequently searched by people in San Francisco. Residents of the City by the Bay who are looking for a vacation home that won’t break the bank are directing their attentions to the Groveland, Calif., area in the Sierra Nevada foothills. The median listing price here has been $239,600 during the past year.

Seven of the top 10 vacation areas searched from people in Chicago are found in warm and sunny Florida. The most pricey spot in Chicagoans’ lineup is the Marco Island area of Florida which is south of Cape Coral. The median listing price during the past year in this area has been $569,000. When looking for more of a bargain, Windy City residents search for homes in Gatlinburg, near the Great Smokey Mountains, where the median listing price is a more modest $179,900. The single most popular area though is a bit closer to home and has had a median listing price of $394,000 during the past year. Grand Beach, Mich., on the shores of Lake Michigan, seems like the place to get away for a weekend.

Los Angeles residents don’t like to venture far from home as all 10 of their top searched vacation zip codes are within 200 miles of the city. The most frequently searched area is around Lake Arrowhead (92352) where the median listing price has been $399,000. The Rancho Mirage, Calif. area, in Coachella Valley, is the most expensive place with a median listing price of $499,000 for the past year. The cheapest place in the top 10 is Arrowbear Lake coming in at $189,500.

While Chicagoans are looking to escape the cold, the most pricey spot Houston residents head for is in the mountains. Breckenridge, Colo., with a median listing price of $675,000 is the fifth most popular vacation area being searched by Houstonians. Their No. 1 most searched spot is Rockport, Texas, where the median listing price is $245,329. And while people from Houston won’t be meeting their friends from Chicago in Breckenridge, they do also turn to Gatlinburg for a more affordable getaway.

To determine which zip codes are becoming more popular as vacation destinations at the quickest rates, we looked at a combination of trended U.S. Census American Community Survey (ACS) data and more recent Trulia search traffic data. From the ACS we trended 2011 5-year data to 2014 5-year data to determine which zip codes had the largest average increases (or decreases) in seasonal vacant units. To be included in the ranking, each zip code had to have at least 3,000 housing units and 5% of the overall stock vacant because they were for seasonal or occasional use. We then combined that with the percent change in search activity each of these zip codes received during the 3-months ending June 1, 2016 to the same period a year earlier and ranked them based on these two metrics. Only searches for homes in vacation ZIP codes outside the searcher’s own metro area were counted as vacation searches.

When looking at what the top 10 vacation zip codes searched from each metro area, we defined vacation areas are ZIP codes with at least 3,000 housing units and where at least 25% of housing units are for seasonal or occasional use (to focus on the more traditional search areas), according to the census. Again, we only counted searches as vacation searches if they were for homes in vacation ZIP codes outside the searcher’s own metro area. For this portion of the analysis, we assumed that the number of vacation-related searches to a ZIP code was proportional to the share of vacation homes in that area.