Second Home Market in The Lakes Region

While practicing real estate in the Lakes Region during the past 48 years, I’ve always had an interest in studying why people move to our state and region. Just yesterday driving to Concord along Route 3 Toward Tilton, I experienced some incoming gridlock on a non-summer weekday. On a more extreme level, as the Labor Day weekend ended, the traffic backup From Concord to Exit 19 was extensive. For those of you who drive from Boston to New Hampshire on a Friday afternoon in the summer months can attest to the growth and popularity the Granite State has seen in recent years.

Attracting and retaining residents from other states has important implications for the state's future population, labor force, and economy. After all, New Hampshire is a very desirable place to live, work, and raise a family, which is one of the reasons why it was picked as the #2 Best State by US News and World Report.

It’s interesting to note that only 41% of the current residents in New Hampshire were born in our state. More than 25% of our current New Hampshire residents were born in Massachusetts, and during 2021 and 2022, 44% of the population that migrated to New Hampshire came from Massachusetts (in just 2022, 23,605 people moved to New Hampshire from Massachusetts), Maine, and Vermont contributed 8%, 14% are from the Northeast, 14% from the South, 10% from the West, 3% from the Midwest and 7% from aboard, according to the Carsey School of Public Policy at the University of New Hampshire.?

In a recent article by US News and World Report, it showed that New Hampshire was ranked #15 in the country in net migration into the state. #1 was Idaho, #2 Florida, #3 South Carolina. Maine was ranked #7. So, as a ranked state at #15, New Hampshire is pulling in a good number of new residents.

When I drive around the Lakes Region, I always reflect on how the second home market has totally shaped the Lakes Region into a very attractive mecca for the entire Northeast. Without question, it has created a tremendous positive impact for our entire state. When you compare the Lakes Region, the Maine Coast, and Cape Cod, all within hours of populous and prosperous metropolitan areas, there is one common trademark. All three of these locations offer premier destinations for affluent professionals and semi-retirees seeking a vacation or retire to a slower pace of living amid attractive natural surroundings with ample recreational and cultural opportunities. We’re basically New England's playground.

In New Hampshire, approximately 10.4% of all housing units in the state are seasonal homes. In Carroll County approximately 41% of the housing stock involves second homes. Next in line is Belknap County with 30% of the inventory as seasonal homes. All you have to do is ride around the lakes in our region and take a trip up to Mount Washington Valley, and you will see the highest concentration of seasonal homes. In Moultonborough, which has 66 miles of shorefront, 60% of all housing units are seasonal homes, Tuftonboro has 53%, and Alton 45%. Even Laconia, the Lakes Region's largest city, has 25%. In Moultonborough, there are over 3,000 second homes. If you drive up the road to Newfound Lake, approximately ?-? of the homes in the four towns bordering the lake are seasonal.

Because of the year-round recreational opportunities, many of the weekend warriors have been overtaken or transitioned to those seeking more bang for their buck by occupying their homes more often.? We are also seeing many of these homes listed for rent on Airbnb, VRBO, Vacasa, and with rental companies throughout the region. Many investors own them. There are also many second homeowners who cannot occupy them at all times and put segments of use on these rental sites to garner additional rental income to help pay the taxes and ongoing operating expenses. Another trend is the relocation of more semi-retired and retired residents every year. So many of them start out vacationing in the area and later settle in the region when they reach their retirement years. Many like to stay in New England to be close to family members. However, in the last few years at Roche Realty Group, we have sold quite a few homes and condos to couples from California, Nevada, Oregon, and other western states. Many of them migrated to come back to New England, where they grew up, to enjoy retirement.

The second home market and the migration of new homeowners to our state has had a profound impact on all the municipalities surrounding the lakes. The assessed values of these homes and condominiums have contributed immensely to the town's overall evaluations resulting in huge tax revenues to fund their expanding budgets. It’s also helped to lower each town's tax rate. Take Laconia, for example; at South Down Shores and Long Bay on Winnipesaukee alone, the total tax valuation was a staggering $406,141,100! This resulted in $5,649,422 per year in annual tax revenue. Think of how many new buildings and infrastructure improvements the city has gained over the years from South Down and Long Bay property taxes. Think about the huge property taxes Gilford generates from Governors Island. Look at Moultonborough with its 66 miles of shorefront; the town's valuation is at epic levels, and its tax rate is one of the lowest in the state.

There’s no question that the influx of second homeowners and retirees has enlivened commerce in the Lakes Region. The construction, furnishing, and maintenance of second homes have employed numerous contractors, tradesmen, surveyors, engineers, furniture stores, attorneys, bankers, insurance professionals, and Realtors. The services and hospitality industry has benefited immensely, look at the lines at our restaurants this summer, and the Bank of New Hampshire Pavilion in Gilford had record-selling concerts; the marinas, motorsports dealers, and even golf cart dealers have all benefited. The Winnipesaukee Playhouse, Lakeport Opera House, Funspot, Gunstock, and so many businesses have benefited from it. We have so much to be thankful for here in the Lakes Region, which is a great place to live, work, raise a family, and enjoy spectacular year-round recreation.

This article was written by Frank Roche. Frank is president of Roche Realty Group in Meredith, NH, and can be reached at (603) 279-7046. Please feel free to visit www.rocherealty.com to learn more about the Lakes Region and its real estate market.