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Owning, letting and demanding second homes

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Abstract

An increasing number of households consume housing beyond the primary home as owners of a second home. Economic studies of second homeownership are still very scarce, and the present empirical study fills this gap to some extent. It is based on Danish survey data combined with administrative register data and presents estimations of the probability of owning a second home, the decision to let the second home and the number of let weeks per year. Also income elasticities for primary and second housing demand are estimated. We find a conventional monotonic increase in demand elasticities for primary housing demand for non-owners of second homes; however, owners of second homes have the highest income elasticity in the middle income group.

Suggested Citation

  • Bloze, Gintautas & Skak, Morten, 2014. "Owning, letting and demanding second homes," Discussion Papers of Business and Economics 1/2014, University of Southern Denmark, Department of Business and Economics.
  • Handle: RePEc:hhs:sdueko:2014_001
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    File URL: http://static.sdu.dk/mediafiles//E/0/A/%7BE0A792F0-AF50-403C-831A-174E0F986A96%7Ddpbe1_2014.pdf
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    1. Dixie M. Blackley & James R. Follain & Haeduck Lee, 1986. "An Evaluation of Hedonic Price Indexes for Thirty-four Large SMSAs," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 14(2), pages 179-205.
    2. repec:cai:poeine:pope_701_0157 is not listed on IDEAS
    3. Fair, Ray C, 1978. "A Theory of Extramarital Affairs," Journal of Political Economy, University of Chicago Press, vol. 86(1), pages 45-61, February.
    4. Gijsbert Hoogendoorn & Gustav Visser, 2010. "The role of second homes in local economic development in five small South African towns," Development Southern Africa, Taylor & Francis Journals, vol. 27(4), pages 547-562.
    5. Malpezzi, Stephen & Mayo, Stephen K, 1987. "The Demand for Housing in Developing Countries: Empirical Estimates from Household Data," Economic Development and Cultural Change, University of Chicago Press, vol. 35(4), pages 687-721, July.
    6. Emilio Torres & J. Santos Domínguez-Menchero, 2006. "The impact of second homes on local taxes," Fiscal Studies, Institute for Fiscal Studies, vol. 27(2), pages 231-250, June.
    7. Goodman, Allen C., 1990. "Demographics of individual housing demand," Regional Science and Urban Economics, Elsevier, vol. 20(1), pages 83-102, June.
    8. Hansen, Julia L. & Formby, John P. & Smith, W. James, 1998. "Estimating the Income Elasticity of Demand for Housing: A Comparison of Traditional and Lorenz-Concentration Curve Methodologies," Journal of Housing Economics, Elsevier, vol. 7(4), pages 328-342, December.
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    10. Hansen, Julia L. & Formby, John P. & Smith, W. James, 1996. "The Income Elasticity of Demand for Housing: Evidence from Concentration Curves," Journal of Urban Economics, Elsevier, vol. 39(2), pages 173-192, March.
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    Cited by:

    1. Marianna Brunetti & Costanza Torricelli, 2012. "Second Homes: Households' Life Dream or (Wrong) Investment?," CEIS Research Paper 351, Tor Vergata University, CEIS, revised 04 Aug 2012.

    More about this item

    Keywords

    Second home; Homeownership; Letting; Income elasticity; Denmark;

    JEL classification:

    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
    • R20 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - General
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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