Georgia's vacation home market has taken the same beating as sales of primary homes in metro Atlanta, with some believing it's even worse.
"I've never seen it this bad before," said Roger Ardston of Woodstock, who sells mountain real estate, owns a cabin near Blue Ridge and runs Blue Ridge Lodge Cabin Rentals, which lists 18 getaway homes in northwest Georgia.
"I would like to say it's getting better. But I don't see it," he said. "Most of [the cabins] we have seen have been on market for 18 months to two years and have not sold."
Georgia's mountains are just an hour or two from Atlanta via Ga. 400 or I-75, and the market for cabins boomed through the 1990s and early 2000s. The state's beaches are farther, but the coast also boomed during the growth years.
Bill Keim, a founder of Signature Properties Group on St. Simons Island, estimated half of sales there now are foreclosures.
"Right now, second homes and investment property sales particularly are pretty close to nonexistent," he said. "There is some activity with vacation properties, mostly in the condo market relatively close to the beach."
The recession left behind cleared lots not built on and foreclosures, just as it has done in metro Atlanta's primary home market.
If there is a bright spot, it is that the prices have come down on mountain and beach homes.
Mike and Linda Weinroth of Sandy Springs certainly saw a lot of reduced prices when they began looking. The semi-retired couple looked at more than 40 cabins, but they ended up building a custom home on property they bought outside Blue Ridge.
The Weinroths are originally from Florida and had dreamed of a beach home there, but after visiting friends in Young Harris immediately began looking in nearby Blue Ridge.
"I can be up there in hour and 40 minutes, which is amazing," he said. In contrast, the five- to six-hour drive to Florida would make it less likely they would use a beach home often.
There is a pretty steady stream of potential buyers like the Weinroths visiting cabins, but the number who go through with a purchase has dropped dramatically, according to real estate agents. Prices have dropped 25 percent or 30 percent in the North Georgia mountains, they estimate.
"There is a lot more supply than demand, cutting prices low, particularly with foreclosures and short sales," said Berry Rankin, part owner of North Georgia Mountain Realty in Blue Ridge.
State figures are difficult to come by because vacation home sales are not recorded separately from primary home sales. But nationally the median vacation home price decreased 11.2 percent between 2009 and 2010, from $169,000 to $150,000, according to the 2011 Investment and Vacation Home Buyers Survey from the National Association of Realtors. Median prices are down from the 2005 peak of $204,000.
The report said one in every 10 vacation homes purchased was a foreclosure, and that vacation home sales in the South slowed more than other parts of the country.
"The real estate market is in a recession, and the second home market for the moment is in a depression," said Pete Halter of Atlanta, whose Halter Companies specializes in developing resorts and managing troubled real estate.
When primary home values are taking a beating -- they have dropped to 2001 levels in metro Atlanta -- people feel financially vulnerable, Halter said. They are not likely to invest in a second home.
His 2009 report on the second-home and vacation-home market does not predict a turnaround any time soon because homeownership aid programs are focused on primary residences and lenders are more hesitant to loan for second homes. Also, when the recession ends people are more likely to invest in delayed items such as new cars and home improvements, Halter said.
"Anyone that gets into a financial bind, the first thing that is going to go is the second home," Rankin said. "Many strive to keep it through putting it in a rental program, but many times that is not going to offset completely the cost of owning."
Still, rentals are up because people are vacationing closer to home and some who formerly dreamed of buying are settling for a week.
HomeAway, a Texas firm that coordinates rentals for owners across the nation, said inquiries into Savannah listings are up 69 percent this year, and they are up 24 percent for St. Simons. In the mountains, inquiries are up 23 percent in the Blue Ridge area and 9 percent near Helen.
Allen Snow of Atlanta bought his 3,600-square-foot mountain home near Lake Blue Ridge in 2005, and he rents out when not using it.
"I charge $295 a night, and this year and last year have been my busiest years ever," he said.
Ardston said every cabin on his roll was rented during the July Fourth week.
He has noticed one change. "In the past, 70 percent of our business came from Florida, and now that is probably 50 percent, and 50 percent is from Atlanta. So people are sticking closer to home," he said.
The weekly tourists and their spending in local stores have helped offset the economic losses suffered from the collapse of the building market.
Forrestt Hamm, a realtor with RE/MAX Around the Mountains in Blue Ridge, estimated up to 90 percent of building activity in the county before the recession was concentrated in second homes. When the building stopped, many were negatively affected.
"It rippled through all our contractors, our builders, then all of our suppliers," he said. "Then real estate appraisers, banks, everybody I know, minus the hospital and school system, were affected."
Lamar Paris, the commissioner of neighboring Union County, said building permits have dropped from about 80 a month during boom times to about a dozen. But that is up from last summer, when the county was issuing one or two a month. Unemployment has remained near 9 percent, but he knows people have left to find jobs elsewhere.
"I'm glad it is not worse than it is, but ... it's tough and people have had to move out of the area looking for work, people doing grading, electricians, plumbers," Paris said.
In Rabun County, the unemployment rate hovers around 15 percent, though County Commission Chairman Butch Darnell believes the real figure is closer to 20 percent, with self-employed craftsmen such as carpenters making up part of the under-reported number.
"Some builders I've talked to recently have two or three houses under construction, so the interest is starting to pick up," he said. "We are trying to be optimistic."
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