Vacation homes energize rural economies

Wisconsin State Roundup

Published January 1, 1997  | January 1997 issue

The economic impact of recreational homeowners on rural communities is not to be taken lightly, according to recent studies from the University of Wisconsin—Extension Center for Community Economic Development.

Recreational homeowners "contribute significantly to revenues," says David Marcouiller, assistant professor, department of Urban and Regional Planning at the University of Wisconsin in Madison and a co-author of the studies. "There's a continuing need to realize the importance to communities" of these homeowners, Marcouiller adds.

The studies look at recreational homes and regional development issues across counties in northern Wisconsin and Minnesota in an attempt to better understand how recreational homeowners impact the economies of "amenity-rich rural regions." The studies indicate that recreational housing "appears to contribute more to a local government's ability to generate revenues than to place demands on services, as measured by public expenditures."

In addition to property taxes, recreational homeowners spend an average of $2,500 to $3,500 annually in the area that surrounds their second home. A survey of recreational homeowners in Forest County indicated that in 1994 construction/remodeling and building supplies made up over 40 percent of total spending.

While the reports' authors point to data that suggest a slowdown in new recreational home development in the 1980s, following a building boom in the 1970s, they say that existing homes are in high demand today and command increasingly higher prices. A growing phenomenon among recreational homeowners, according to Marcouiller, is the cabin that starts with one-season use, grows to a three-season structure and often becomes a retirement home.

The studies conclude that recreational homes make up such "a surprisingly large share of the total number of housing units found in rural portions of Northern Wisconsin and Minnesota that much of what happens in these regions is influenced by the activities of these homeowners."

Kathy Cobb