For a growing group, it's homes sweet homes

CHICAGO — Diane Pyshos collects houses.

At the moment, she and her husband, Bill McCollom, have three. They and their son, Thomas, manage to live in all of them, although daily life can be complicated by errant clothing or grocery miscalculations.

"One house has five mustards, and the other houses don't have any," she joked. "You forget which house you're supposed to go to."

Not that she's complaining. The three love their self-described schizophrenic existence, which revolves around two homes in Michigan (a mere 5 miles from one another) and one in the Bucktown neighborhood of Chicago. They're thinking about a fourth in Arizona.

They may be on to something. Thanks to a confluence of demographic and economic factors, owning two homes is verging on the commonplace, according to gatherers of real-estate data. And now, some number crunchers are starting to scrutinize the ranks of owners of three or more homes.

"We call them 'supersplitters,' " said Bill Jacobs, a demographic analyst in Seattle.

Jacobs' firm studied second-home ownership for WCI Communities. The real-estate-development company in Bonita Springs, Fla., coined the term "splitters" to differentiate an emerging profile of second-home owners from the more traditional snowbirds, who tend to divide their time seasonally.

Splitters, on the other hand, are likely to bounce between homes, relatively speaking. And supersplitters, with three or more homes, elevate that practice to an art form.

Their numbers are nearly impossible to peg. Public records and lenders' data don't tally how many properties a buyer owns or how the homes are used. Some third properties are strictly investments; some are for personal use; others are a blend.

In addition, a revival of interest in time shares and the creation of so-called fractional ownership of vacation properties have put the term "our third place" on many more people's lips.

Clearly, these changes have the potential to move multiple-home ownership beyond the confines of the super-rich — who long have trod the Newport, R.I.-to-Palm Beach, Fla.-to-Palm Springs, Calif. circuit — and into the ranks of the "economically comfortable."

They're out there.

"Income is tilting toward the top end of the scale," said Peter Francese, a demographer in Exeter, N.H., who said that if third-home ownership isn't entirely mainstream, it's getting closer.

"One-fifth of all households take home 50 percent of all the money in this country," he said. "So, multiple homeowners might have a ski condo in the winter, a summer place on a lake and a regular house that they live in the rest of the time. It's a small segment, but significant."

In WCI's national study of 1,743 homeowners, 20 percent own primary and second homes, and 9 percent — the supersplitters — own a primary and at least two second homes.

"We were surprised at the incidence rate," Francese said. "It was higher than anyone expected."

44 million of them

The National Association of Realtors estimated a year ago there were about 44 million second homes in the U.S. — about 7 million private vacation homes and 37 million investment properties.

But the definitions can be a confusing tangle. The realtors association also estimated that 10 percent of those investment buyers at least intend to use their second properties at some point for recreational purposes.

The trade group said that in its study of people who bought second homes in 2004, 38 percent said it was very likely they'd buy another home within two years.

"It's absolutely a real phenomenon," said Francese, a trends analyst for Ogilvy & Mather and the founder of American Demographics magazine. "There are a lot of reasons why it's happening."

Possibly the biggest driver of third-home ownership has been record-low mortgage-interest rates, coupled with a growing affinity for real estate as a long-term investment, he said.

"An awful lot of people are skittish about the stock market, but real estate — that's viewed in the general public as a sure thing," Francese said.

Place to put equity

Then there's the bumper crop of baby boomers who not only are in their peak earning years, but who might be looking for something to do with the equity from the primary residences they bought as long as three decades ago.

They're also at an age when vacation homes may double as retirement destinations.

Technology plays a role, too. Expanded air routes have put more vacation destinations within reach and telecommuting — to keep in touch with the office, if not to work full or part time — makes it possible to stretch regular weekends at a getaway spot into long weekends or more.

Pyshos said she and her husband, for example, conduct their businesses — she's a mortgage broker; he's an architect — from their New Buffalo, Mich., home, with each of them making once-a-week, 90-minute drives back to the Chicago house for client meetings.

The New Buffalo home, in the southwest corner of Michigan, is their main residence. In spring, they move to their place in nearby Union Pier, Mich. It's an unusual arrangement, she acknowledges.

"We're the only people who have a summer home and a winter home within five miles of each other," she said.

The Union Pier home, which is near a Lake Michigan beach, is a summer cottage that would be prohibitively costly to winterize, she said. So, they use both.

Like Pyshos and McCollum, supersplitters are likely to have at least one of their three or more homes within easy driving distance from another, the WCI research said.

Demographic analyst Jacobs said a fairly common supersplitter scenario in the Midwest would be a primary residence in suburban Chicago, a home in Michigan or Wisconsin and a place in Florida.

Another familiar arrangement would be the suburban home, a condo downtown and a third place at a lakeside area within a few hours' drive.

Notion of escape

Market researcher Brooke Warrick said the notion of escape is one of the principal motivators for second-home purchases.

"In my studies, close to home is not OK," Warrick said. "Typically, it has to be [at least] two-and-a-half hours, by plane or by car, so that they can feel like they're getting away.

"They have this illusion that they're far enough away so that they could be separated from their jobs. But a lot of them take the job with them."

Holly Anthony of Wheaton, Ill., said that being electronically tethered to the job makes it possible for her husband, David, and their four young children to spend extended periods together at their homes in Michigan and Florida.

"He has an office in Chicago, but he always packs his computer and he's good to go," Anthony said.

Warrick, whose California firm, American Lives, studies consumer behavior for the real-estate industry, said he's skeptical of the growth potential of third-home ownership.

"There's going to be a backlash, in terms of second and third homes," he said. "People are going to understand that owning these things is a lot of work."

Support services

But others say the real-estate industry recognizes the potential for such disenchantment and is trying to build in support services to shoulder the maintenance burden.

Anthony said she regularly calls on services in Florida that cater to the maintenance needs of out-of-towners.

"You can hire them to go check on your place every month or every two weeks," she said. "We do our [house] cleaning through them, and we have them open the place up before we get there."

Such service comes at a price, of course, although it's one that many in the housing industry say consumers are willing to pay.

"The biggest and most valuable commodity in [the baby-boomer population] is time," said John McIlwain, senior fellow for housing at the Urban Land Institute in Washington, D.C. "People are all the time spending money in order to have more time."

He expects the second-home market to remain solid for another decade, but he too, said third homes are likely to remain but one of many niches that have emerged in housing in recent years.

For one thing, he said, the federal tax structure permits deducting mortgage interest only for homes No. 1 and No. 2 if they're strictly for private use.

"You're paying full freight for that third house," he said.

But Pyshos said that, as a mortgage broker, she sees consumers with a home-buying habit that goes beyond dollars and cents.

In her case, that place in Arizona — potentially home No. 4 — stays in her mind.

"You would think, 'Why don't they just buy a time share?' " Pyshos said. "But it's an addiction. There's something about the collecting of houses.

"It's not a status thing for us. We're just house people. We like to collect houses."