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I’m still at my vacation home, but the season is drawing to a close. The flock of summer visitors have flown back to the real world, to their bustling, busy lives. A vacation home is a funny old thing, isn’t it? A temporary nest for most, a place to perch for a week or two before the demands of reality call them back.
But there’s a small, peculiar flock of us who have decided to linger a little longer, notching up the months because we can. We’re all retired—a gentle, normal bunch of folks, still enjoying the quiet, lingering magic of the quieter season. I’ve gotten to know this little group, bumping into them on walks along the beach or cliffs, and stopping for a friendly chat while waiting to be served at the harbour bar. We all seem to share a common story.
Take “Bubbles,” for a simple example. Her interesting career was really a path toward a simple, comfortable retirement. While she worked hard, she worked even harder on her retirement hopes, saving for these very times to live a life by the sea and enjoy her favorite champagne—which, of course, is why we affectionately call her that.
Then there’s Allan, who loves to talk about his boat moored in the harbour. He’s cultivated a salty sea dog look—grey beard and all—but he cultivated his retirement by living below his means for years to enjoy that wonderful boat. I see it not as a sign of wealth, but as his reward for a life of prudence.
And what about Karen and Steve, who have one of the fancier homes? Surely this breaks the theme? Not at all. They bought the lot when our little area wasn’t very popular and prices were cheap, spending their weekends and vacation time for twenty years, remodeling their wonderful home into a peaceful heaven to enjoy their retirement dreams. Some might see a house of privilege, but I see a house built on hard work and delayed gratification.
So, if you ever find us at our little harbour bar hangout, don’t mistake us for the naturally privileged. We’re the product of dinners at home instead of fancy restaurants, past owners of cars so old they had a family name, and vacations postponed to claim a retirement dream. It was thrift stores and careful choices that propelled us to our coastal homes, where we now linger and enjoy the empty beach and salty air of the wild Atlantic swell.
Kiplinger recently published an article discussing efforts in Rhode Island to add a luxury tax on expensive vacation homes. It also discusses some other state’s efforts to raise money from second homes.
Can’t say I find this surprising. Tax the rich is really popular in some parts.
I could see this causing a decline in property values across the state (as the handful of truly rich will pay, but it would depress the demand from out of state people to maintain prices long term).
So weird that we have a housing crisis urged on by bad housing policy (rent stabilization and rent control) and places seem to think more bad policy is the answer.
It is entirely possible that the year round residents, especially ones who grew up there, would prefer fewer part timers.
No doubt that is true. I might think that way too, but the locals sure enjoy the economic value they gain even while complaining..
Chatham Mass used to be a fishing village, now it only survives on tourism and they keep building so as to destroy the environment that created the value of going there. There hasn’t been a year we don’t go up that another plot of land has been built on.
So what happened to the fishing? In NC there’s a decades long ongoing fight between the commercial fishers, many from families who have been fishing for generations, and the wealthy recreational fishers.
I hear you. Our modest vacation home which we barely could afford when we purchased has turned into a major investment asset.
The town is trying a new scheme to penalize non-resident homeowners. It will give a 35% reduction in assessed value for property taxes to residents with non-resident’s picking up the slack.
Residents forget that many of the amenities the town (community center, new town hall, police and fire stations, playgrounds,) enjoys are affordable only because of non-resident owners, not to mention the economic value generated in the summer for small businesses. Very short-sighted thinking.
A life long quest for a good retirement is often overlooked. People tend to look at us as we are now and forget the journey to get here. Our condo community is looked at by many people in the area as an enclave of rich old people. I often hear “I wish I could live there.” from people still living in our old neighborhood. Some see us as privileged others claim we live a lavish life. One long time good friend chides me about my car every time we meet. He only buys used cars. He seems to forget he owns two homes and a rental property.
I know many of our residents but I don’t know of any who had a blank check handed to them upon reach age 60. One fellow is an Auschwitz survivor.
I still maintain starting with zero and being designated by statistics as “wealthy” 80 years later is doable for most people with most of the journey up to the individual.
I guess you could say the absence of misfortune is a privilege, but what a person does with that gift is not.
I seem to recall you saying that your vacation home was valued at $900,000 with property tax of $2,000. I don’t see how your low taxes are paying for many public amenities like libraries, fire protection, etc. It really doesn’t matter how you acquired property; if you own it, paying reasonable tax is appropriate.
Same with the NJ condo. If you’re perceived as wealthy— you likely are. “If it quacks like a duck, walks like a duck, and sounds like a duck, it probably is a duck!”
I paid $159,000 for the house in 1987 and added about $250,000 in improvements over the years. Our taxes are $2700 which is a bargain compared to NJ. I don’t mind paying the taxes, I mind being treated differently just because we are not year round residents. The property taxes are what runs the town of 6600 year round residents who benefit from the summer residents.
Context matters – that ‘wealthy duck’ you see might just be a regular duck in a rich pond.
Not so sure— birds of a feather tend to flick together. And would you consider an average duck is rich pond one who drives a Mercedes, lives a an upscale, probably gated ccndi community, and has a vacation home on Cape Cod??
Perhaps you’re right. A lifetime of prudence and patient accumulation—decades of diligent work—has finally resulted in a well-deserved period of wealth. Does this achievement annoy you? Maybe you find it wrong?
No, it doesn’t bother me at all. I do, however, find it ridiculous that anyone should object to non resident property tax increases. I have a second home and for sure my taxes do subsidize the residents. That seems fair— they provide the services that I need during the summer when I’m here.
What services do they provide that you do not help pay for as well?
I do not object to taxes or tax increases, but the residents are the beneficiaries of the taxes paid by non residents and it seems fair we should all pay the same taxes based on home values.
The residents also benefit from rising home values driven by the nonresident homes which residents allowed if not encouraged to be built and still do.
In a society where growing numbers of people can’t afford one home, those of us with two are going to be perceived as privileged. It really doesn’t matter how much we paid when we got the property, it’s the current situation that matters. The “older women” to whom you give large cash tips aren’t waitressing for the fun of it— they need the money and are likely to be living paycheck to paycheck. I don’t find it unreasonable to be expected to pay a disproportionate share of the community expenses to continue to have access to car repair, convenient groceries, police protection, restaurant service etc during the months I’m here.
Also, I don’t expect a massive exodus of second home owners due to taxes. Just this year, I visited the NC Outerbanks, the Berkshires in MA, several coastal towns in Maine, and Door County in WI. In all cases, the wealth of non residents was obviously much greater than the residents on whom they depend for essential services. Any second home owner is unlikely to find a desirable vacation place where this disparity isn’t the case,
Thanks for your thoughtful comments on this topic. I could not agree more. I’m from Hawaii, where locals are increasingly priced out of the housing market, with short term rentals and wealthy snow birds with second homes exacerbating the situation. It’s infuriating that these people often find ways to avoid paying their share of taxes, while increasing the pressure on local resources and infrastructure.
And to Kathy’s point above, yes, many year-round residents would prefer fewer part-time residents.
How could you know the wealth of non residents or residents. I have a neighbor on the Cape. He was there before we bought. To say they live modestly is generous. But I also know he inherited his parents house about ten years ago that at that time was valued at $2 million. His dress, his cars, his house all say pretty low income, but that is not reality.
I grew up in a household that couldn’t afford a house. Five of us lived in a one bedroom apartment with one bath. My parents used the dining room as their bedroom, I slept on the couch. When my father was in his mid sixties they bought their first house with my sister’s family, still for the seven of them with one bath. I know what living paycheck to paycheck means. My parents did it all their lives.
I am immensely grateful for the lack of serious crisis or misfortune in my life. Beyond that Connie and I made it all work. Nobody helped us financially and our journey to our current position took 80 plus years and a 56 years marriage.
I have empathy for those who through no fault of their own struggle financially and we support them in several ways, but I have no empathy for those irresponsible folks who make poor decisions, who waste money, or abuse debt.
I bought our house, I invested in it adding additional value while time added more value as it did to every house in town. I should pay more in taxes as a result.
On top of that, non resident can’t vote in local elections. Imagine, new taxes with no representation 80 miles from the site of the Boston Tea Party 😱
Just because I don’t live their year round I should not pay extra for that. Not all none residents are wealthy, not all their homes are of high value. The town has already added a requirement for people who want to rent their house to pay a fee for a permit.
Taxation without representation is hardly unique to second home owners. As a legal permanent resident I paid the same taxes as a citizen but had no vote. (Since the UK, at the time, restricted the vote to residents I was doubly disenfranchised.)
We’ve no extra taxes, although we don’t get a capital gains tax exemption on a second home.
There are some counties in Michigan that severely hike up property taxes on non-resident owners. Some married couples file taxes separately, claiming that they live apart in order to get the resident rate at the lake property.
I use to have some tax clients who owned condos in Florida that they stayed in during the winter months. They were not eligible for the property tax homestead exemption, which is available only to Florida residents for their primary residence, that exemption would reduce the assessed value of a property by up to $50,000 for tax purposes. This benefit eludes non-residents, resulting in higher property tax bills.
NJ has similar restrictions on non-residents participating in property tax relief programs, including a new Stay NJ program aimed at keeping seniors as residents.
That’s quite different from what I am talking about. By the way Rick, have heard anymore about the supposed 50% property tax rebate for NJ seniors?
Now that’s interesting. I can’t see how hiking taxes on non-residents can be legal. I think that’s why in Mass they are allowed to reduce assessed values which lowers the base even while increasing the rate be $1,000.
Mark, your neighborhood portrait made me smile. I suspect our southern Oregon beach house was much like your “harbour” — quiet, unfancied, populated largely by locals, and mostly bypassed by the tourist traffic heading from the Northern California redwood parks to the lighthouses and art galleries of the northern Oregon coast. Our plan to live out our retirement lives there didn’t work out, but we remember it fondly.
Do you think someday you might just forget to go home?
Your assumption is very much correct. The harbour and village are a mile off the main road that takes tourists to the Giant’s Causeway, bypassed by everyone but those in the know. With a total of one village shop, two restaurants, three bars, and a nice hotel, it’s perfect for us.
I don’t know if I could be a permanent resident; I’m starting to chomp at the bit wanting to get back home for the start of the autumn racket sports season. Maybe when I’m older, time will tell.
Mark, I’m thinking of places in the US like Sanibel Island, FL. The roads are clogged with tourists during the winter. The 6382 permanent residents must sigh a breath of relief when the island empties. I also imagine that a number of residents are long term, who owned the homes before prices skyrocketed.
Dan, things have changed dramatically on Sanibel since the hurricane. Some homeowners have been unable to rebuild, hundreds of homes and lots are for sale, and property insurance has soared up to $17,000/year with no flood coverage.
Mike, I was wondering about that while writing my post. What a nightmare!
Dan, you’ve touched on a sensitive issue that’s always in the back of my mind. Our little coastal village has only 500 permanent residents, while over 50% of our housing stock is classified as second homes. Thankfully, because it’s off the beaten track, it’s not a major tourist hot spot. Even so, during the summer, the population swells by an extra two to three thousand people. It’s a tension between the numbers of people and the money spent in the local area. Just over a mile away a tourist spot received half a million visitors last year. I’m grateful they don’t come to us.
Mark, your off the beaten path home sounds truly idyllic. The local pub sounds like the perfect place for good conversation, a quiet pint or even just a cuppa.
You sure you’re not filthy rich😂
Looking at my bank balance, it would seem not 🤑