The State of the Market for Second Homes, Prior to the Pandemic

Na Zhao provides analysis and data for the National Association of Home Builders (NAHB) about the number nd location of second homes in the U.S. real estate market. While this report doesn't begin to speculate on how the COVID-19 pandemic and its effects might alter the second home market, it does provide the most recent available data (2018) about the geographic spread of second homes prior to the outbreak of the pandemic.

Here Zhao provides a summary of the data:

According to NAHB estimates, the total count of second homes was 7.5 million, accounting for 5.5% of the total housing stock in 2018, the most recent data available. As of 2018, the state with the largest stock of second homes was Florida (1.1 million), accounting for 14.5% of all second homes. South Dakota had the smallest stock, approximately 20,000 second homes, among all 50 states. Half of the nation’s second homes can be found in nine states: Florida, California, New York, Texas, Michigan, North Carolina, Arizona, Pennsylvania, and Wisconsin.

Zhao teases out more geographic distinctions and also notes one potentially surprising finding in the data: the concentration of second homes is not limited to conventional locations like coastal areas. "There were 932 counties spread over 49 states, where second homes accounted for at least 10% of the local housing stock," according to Zhao.

For some informed speculation about how these figures might change, Robert Dietz, chief economist for the NAHB, tweeted a prediction that home building is likely to increase in traditional vacation markets.

We'll have more on home building in traditional vacation markets soon (a part of the changing geography of housing demand analysis), but here's the benchmark data using the ACS. We classify 5.5% of the housing stock as vacation homes: https://t.co/MT5fuompum pic.twitter.com/s0GhwFPOyF

— Robert Dietz (@dietz_econ) October 16, 2020