Cities where Americans are buying second homes at record rates and who is buying them
The desire to own a secondary home somewhere else in the country has never been stronger for Americans. Whether it's somewhere with a lake or a mountain view, or just fewer people, owning a second home is a pursuit of many, and the COVID-19 pandemic offered the perfect opportunity to achieve that goal with heavily cut interest rates and cheaper pricing.
In the years since, demand has come down from its peak. SellMyTimeshareNow's analysis of Federal Home Mortgage Disclosure Act data found that mortgaged second-home purchases dropped roughly 66% from their 2021 peak, falling from 257,547 to 88,158 in 2025.
This correction was largely driven by elevated interest rates post-pandemic and the high median cost of vacation properties. That number, however, undercounts the real level of activity as many affluent buyers are utilizing cash to sidestep the mortgage market entirely.
The demand for vacation homes is real, but it's unevenly distributed and concentrated among older, wealthier and more geographically flexible buyers. This has resulted in a specific set of markets across the country emerging as the primary beneficiaries. AnyWho has examined data from the U.S. Census Bureau, National Association of Home Builders, Realtor.com, the National Association of Realtors, Fortune, and more to show where buyers are going and why.
The scale of second-home activity
U.S. Census Bureau data shows roughly 7.5 million homes are classified as seasonal, recreational, or for just occasional use as of 2023. These broad categories include vacation cabins, lakefront houses, beach houses and normal second homes that are used intermittently. They also found that these properties were heavily concentrated in some of the geographies you'd expect: lake towns, mountain resorts and small rural communities.
Further, the National Association of Home Builders index tracks construction in second-home areas. While mortgaged second-home purchases have fallen by roughly two-thirds since their 2021 peak, the NAHB construction data from 2024 shows that new construction designated for that purpose remained at an all-time high. This is indicative of many wealthy buyers skirting the mortgage market with cash.
It also shows how half the nation's second homes are concentrated in a remarkably small number of congressional districts. Coastal Florida, coastal New England, the Upper Midwest lake country, and mountain resorts in Colorado, Utah and the Carolinas dominate. By studying where second homes are clustered, you can better understand the places where geography, accessibility and lifestyle intersect for the American upper-middle class.
Who is buying: The buyer profile in 2025 and 2026
The second-home buyer of 2025 looks different from the pandemic-era buyer of 2020, which is a trend that has carried into 2026. There are three distinct groups driving most of the activity today:
1. Baby boomers cashing out
Boomers reclaimed their position as the largest homebuying cohort in 2025, per Realtor.com data. Many are equity-rich after decades of primary residences that were increasingly mortgage-free. For some boomers, making second-home purchases as part of a broader transition toward retirement feels like a natural next step.
These individuals sell a large primary home in an expensive major city, then buy a smaller replacement home in a lower-cost city. The remaining equity then goes toward a vacation property. The upper end of this cohort also uses cash, meaning their movement isn't recorded in mortgage data at all.
2. Millennials inheriting and co-buying
The great wealth transfer is also finally starting to reshape the second-home market, too. As the Silent Generation and early boomers pass down their assets, a meaningful group of millennials are entering the second-home market for the first time. Younger millennials are still frugal, per home buying data from Motley Fool, with a median home purchase price of $250,000, but their older counterparts are acquiring more property through inheritance or co-purchase agreements.
3. High-earning hybrid workers
The third buyer group is the one that is most associated with the pandemic: dual-income households with remote or hybrid flexibility. These individuals treat a second home as more of a secondary base of operations as opposed to a vacation home. These buyers can range in age and generation, but typically have household incomes over $200,000 to be able to afford this lifestyle.
Where they're buying: The regional breakdown
Where these groups are purchasing homes is spread out across the country, but there are a few key trends defining the moves. Based on data from Realtor.com, GoBankingRates, the Wealth Enhancement Group, Pacaso and Fox Business, these markets are seeing the most growth:
The Southeast Coast and Gulf: High Demand, Accessible Entry Points
Florida dominates the national second-home market. It is home to five of the top 20 counties in many luxury second-home rankings and appears consistently from an investment perspective. The Florida panhandle, Gulf County, Walton County and Okaloosa Island in particular have emerged as the most active corridor, driven by white-sand beaches and relatively accessible flights.
North Myrtle Beach, South Carolina, also appears in many reports, reflecting the same drive to coastal demand that has made the Grand Strand one of the most accessible beach markets on the East Coast.
The Mid-Atlantic Shore: Drive-To Proximity Wins
Cape May County, New Jersey, topped Pacaso's luxury ranking by a wide margin, the result of its combination of coastal access, historic character and close proximity to Philadelphia, New York and Baltimore. The Jersey Shore broadly has seen sustained second-home interest from buyers seeking beach access without the logistics associated with flying, and Cape May's unique Victorian architecture creates a natural appeal.
The Delaware beaches of Rehoboth, Bethany and Dewey also operate in the same region, drawing D.C. and Baltimore buyers looking for proximity over name prestige.
New England: From Prestige Markets to Underdog Picks
Barnstable County near Cape Cod, Massachusetts, remains in the top five second-home markets nationally by transaction volume. However, it is increasingly a market of established owners holding rather than new buyers entering.
Prices have gone up sharply since 2020 and the inventory remains thin. The underdog picks in this part of New England are all migrating inland: the Berkshires in western Massachusetts, the Lakes Region of New Hampshire, specifically Meredith and Wolfeboro, and the coastal Maine communities north of Portland.
The Mountain South and Appalachian Corridor: Affordability Meets Scenery
The Smoky Mountains region, anchored by Gatlinburg and Sevierville, Tennessee, is one of the most sought-after second home and vacation home regions in the country, not by luxury transaction value, but by volume. The area attracts buyers who want mountain scenery and cabin ownership at price points that remain cheap compared to the rest of the country. The short-term rental market provides a clear income offset to this.
Asheville, North Carolina, and the surrounding Blue Ridge communities all serve a similar function, albeit at a slightly higher price point. This area draws buyers from Atlanta, Charlotte and the Research Triangle.
The Midwest: Underappreciated and Increasingly Sought-After
GoBankingRates identified Michigan and Wisconsin as hosting some of the hottest housing markets in the country. The second home dynamic is a meaningful part of that story. The Upper Midwest lake country, anchored by Vilas County, Wisconsin, the Traverse City area in northern Michigan, and the Lake Michigan shoreline, offers lakefront property at low price points.
For Chicago buyers in particular, the Wisconsin Northwoods and Michigan's Lower Peninsula are the primary second home destinations.
The West: Constrained Supply, High Stakes
Western second-home markets are considered to be the most supply-constrained in the country. Colorado's resort corridor of Summit County, Eagle County and Pitkin County, for instance, have seen median second-home prices skyrocket above $1 million. This limits the buyer pool to the upper quartile of wealth distribution.
The more accessible Western alternatives see buyers migrating outwards. The Bend, Ore., Ketchum, Idaho and Sun Valley corridor, and Montana's Flathead Lake region are all absorbing demand from buyers priced out elsewhere. In California, the second-home geography concentrates around Lake Tahoe, the Central Coast near Paso Robles and Cambria, and the Palm Springs desert.
The community trade-off: What influx means locally
The communities that are absorbing all of the demand are not passive recipients. Second-home concentrations create a noticeable set of economic and social dynamics that play out consistently across the country. Regardless of whether these communities are in the Wisconsin Northwoods, the New Jersey Shore, the Tennessee Smokies or Lake Tahoe, the impacts are similar.
First, the fiscal upside is real. Second-home owners pay property taxes without proportionally consuming the local services of the area. Children typically aren't being sent to local schools and municipal services aren't being used, yet these individuals contribute heavily to the tourism economies of the areas through food, retail, and general service spending. This often results in property tax revenue from second homes serving as a form of subsidization year-round.
However, the housing affordability problem is also equally real. When second-home buyers enter a local market, they are usually competing against local buyers who have less capital. Academic research published in Progress in Planing journal during the pandemic found that second-home influx into rural and small-town markets created devastating disparities and displacement of local buyers and renters. Price appreciation that outpaced local income growth and reduced supply of long-term rental housing were a few of the major downsides.
The tension becomes most acute in small markets. A town of a couple thousand people having to absorb several hundred new second-home purchases over a short period of time is far more disproportional than a larger community facing the same issues. Gatlinburg, the Northwoods towns, and the Maine midcoast are a few areas that are hit hardest. Workforce housing availability, infrastructure strain during peak travel seasons, and the social textures of communities where a growing number of houses sit empty during the year are all important issues.
What buyers should know before choosing a market
The most important variable in a second-home purchase isn't the property itself, but rather the market infrastructure around it. Markets sort into three categories that should shape how a buyer evaluates a purchase:
- Established markets with thin inventory
- Emerging markets with improving fundamentals
- High-volume rental markets
Established markets offer liquidity and proven demand, but appreciation is limited and there is little margin for timing errors. These are the markets where paying the wrong price is punished by slow recovery. On the other hand, emerging markets offer better entry prices and appreciation potential, but the offset is a higher required conviction about the trajectory of local demand and less reliance on short-term liquidity. High-volume rental markets should be viewed more as income-producing assets first and vacation home destinations second. These markets are defined by factors such as cap rates and rental yields, rather than the restaurants and shops nearby.
Before committing to an unfamiliar market, it also pays to do your homework on the community itself. Verifying a seller's contact information, reconnecting with a local contact who can give you an honest read on a neighborhood, or simply getting a clearer picture of who your neighbors might be in a small town are all reasonable steps in the due diligence process. A people search can help buyers quickly surface contact details and background information on individuals before any money or trust changes hands.
Across all categories, the financing environment is an underlying factor. Second-home mortgages carry a premium over primary residence rates. Lenders will scrutinize your debt-to-income ratio strictly and the down payment requirements will be higher. Cash buyers have an inherent structural advantage here, which is partly why the data shows mortgage activity declining despite increased demand. Buyers who need financing should model out their carrying costs at current rates, rather than the rates they expect to see in a couple of years.
The second home as a concept has never been more aspirational given housing prices. The markets that support it are specific, the costs are hefty, and the communities absorbing the demand have many trade-offs. For buyers who do the work, though, the entry points are there so long as you know how to read the map.
This story was produced by AnyWho and reviewed and distributed by Stacker.
Copyright 2026 Stacker Media, LLC
This story was originally published July 1, 2026 at 9:30 AM.