|Spring Real Estate 2005
Publication Date: Wednesday, July 20, 2005
by Susan Golovin
In 1997, Atherton residents Gretchen and Tom Pomeroy bought a three bedroom, three bath Lake Tahoe "fixer upper" as an exchange for a San Francisco investment property they had recently sold. They were not considering a vacation home.
"It was very ugly -- very '70s with fake Tudor embellishments," Gretchen said, "but it has a magnificent view of the lake, and for very little money -- (the only structural change was removal of a wall to enhance the view from the entry) -- I was able to make it cute." In short, the place has never been rented.
"When the kids were little, we had no desire to have a second home," she said. "We thought it would limit our travel. As we get older (the Pomeroy family consists of two grown sons, one of whom is married) we find that it fosters family unity. We all get together in a fun environment."
The Pomeroys use their Tahoe home about six to seven times a year -- and in all seasons, and their children use it individually as well.
"We have strict rules," she said. "I don't want to find any chemistry experiments in the 'fridge. And of course, in the winter we have to be careful to keep the heat on low so that the pipes don't freeze."
Pomeroy calls a cleaning service about a week before they arrive. Other than that, and a snow-plow service, upkeep has proved fairly simple.
In 2000, the Pomeroys also bought a two-bedroom, two-bath suite in the Trump International Hotel in New York City overlooking Central Park. "Tom and I splurged and stayed there for our anniversary. I loved it so much that I asked the management if there was a frequent guest program, and discovered that the suites are available for purchase."
Since the Trump International is primarily a hotel, when the Pomeroys are not using their unit, it is occupied by other guests. "We can use it up to 175 days a year maximum," she explained. "For it to make sense for us financially, we have to be there about 30 times a year. We use it about twice as often as that."
"We have season tickets to the Metropolitan Opera, and I don't hesitate to hop on a plane and take in a New York cultural event," she said. They also appreciate the high-end service and the fact that they don't have to be concerned with furnishing and cleaning.
Maid service and New York City hotel taxes are part of the overall cost. The only unanticipated expense occurred when the hotel decided to redecorate all the rooms in order to compete with the new hotel in the nearby Time Warner Building.
She says that the $1 million investment yields about a 3 percent return yearly -- which is dependent upon the hotel booking their suite. It has proved to be a good investment despite the events of 9/11 that temporarily affected the NYC tourist trade.
Nancy Ryde, her husband Magnus and their 10-year-old son take one month summer vacations in Dalaro, Sweden, a resort area on the Baltic about 45 minutes from Stockholm. In 1990 they purchased a property, with the original home that had been in Magnus' family since the 1930s.
"About four years ago we took it down and re-built a very un-Swedish home," she said. "One whole side is glass, which overlooks the water and there are dramatic high-pitched ceilings."
The 850-square-foot home is of comparable size to those surrounding it, however. "The Swedish are very modest," she added.
Building a home long distance was facilitated by the fact that Magnus' father's property abuts theirs. Also, Magnus has dual citizenship and knows the ropes. However, there were still a few surprises.
"Our Swedish contractor was very skilled and sometimes made decisions without consulting anyone," Ryde said. As a result, when the builders hit rock they decided to reposition the house; rather than inconspicuously nestling into the landscape, it perches on the rock -- an affect mollified by a stone wall.
Ironically, Ryde said that the experience was very freeing, quite different from the remodel of their main residence in Atherton. "When you don't have total control, you can't be so attached to every detail. It's not so distressing if everything isn't perfect."
In fact, Ryde feels that it's important not to make a vacation home "a home away from home." "It's interesting to see how you can live in two different ways," she said.
Although Magnus' father looks after the property, they are considering what to do long term. "The Swedish people are not service-oriented. They take care of their own properties," she said.
"We try to fit in other vacations," Ryde said. "But when you have so much invested in a place, there's sort of a guilt thing if you don't use it." Guilt is minor compared to such advantages as exposing their son to his father's heritage.
Leslie and Michael Nelson of Redwood City have a vacation home in Sun Valley, Idaho. Twenty-six years ago Leslie, an avid sportswoman, purchased the three bedroom, two bath home that sits on 4 1/2 acres, for $80,000. Now, because it is located north of Ketchum in a desirable area that has restricted development, she figures it is worth about $1.7 million.
"I love the fact that it's a destination vacation," Nelson said. "It makes it less touristy because it's so hard to get to." She also loves the fact that the community is small and intimate with a low crime rate.
She and her husband try to visit three times a year and Nelson thoroughly enjoys not only skiing, but also horseback riding, fly fishing (she keeps a stocked pond on the property) and mountain biking.
Because of the long, harsh winters, upkeep requires a full time caretaker. The main problem seems to be the wildlife. "You have to seal everything to protect from the bears. Also, the river otter love to eat the foliage," she added.
All of the home owners agreed that you don't buy a vacation home solely as an investment, but that consulting a tax attorney who can advise on appropriate deductions is probably wise.
Sums up Pomeroy, "You should love it."