The Future of Vacation Homes Is Here
The housing bubble is worse than you think. Here’s how the nation’s most affluent families are avoiding the growing risks associated with second-home ownership — and opting for a new kind of market-proof vacation.
During the pandemic, vacation-home ownership became a national obsession. With work and school largely remote, and interest rates at a record low, there were precious few reasons not to invest in a second or third property. But the high of the vacation home has come crashing down — hard: Luxury home sales have plummeted by 38 percent, the biggest decline on record, due to skyrocketing mortgage rates, mounting inflation, and growing fears of a recession and housing market crash.
By comparison, private membership clubs like Exclusive Resorts have never looked so good. While homebuyers face increasing costs on everything from mortgage rates to repairs, Members of the Club pay a one-time initiation fee (starting at $195,000 for a 10-year plan) and fixed annual dues starting at $23,925. In return, they enjoy 15 to 30 days of travel per year at their choice of 350-plus multimillion-dollar private residences and experiences in 75 sought-after destinations around the world. It’s no wonder the Club is seeing its strongest sales in more than a decade, with more than 4,000 Members to date.*
What Exclusive Resorts Members gain is as important as what they avoid: namely, the headaches and pitfalls of vacation-home ownership. “Second homes often seem like great investments — something you will use frequently with family and friends while it appreciates in value,” says Steve Case, Exclusive Resorts owner and chairman, who joined the Club in 2003. “But what often happens is that you use it less than expected and are surprised by the expense and hassle of owning another property."
Exclusive Resorts’ $1 billion-plus real-estate portfolio — which is one of the largest in the world — invites its Members to forgo the vacation home for hundreds of hassle-free residences. Nearly half of the Club’s homes are four- or five-bedroom residences that, on average, are around 3,500 square feet and cost more than $4 million each. Many are located within award-winning resorts — operated by luxury hospitality leaders such as Montage, Peninsula Hotels, Auberge, and Four Seasons — and designed and outfitted in collaboration with top interior designers and upscale home-furnishing brands. The Club even owns four luxury apartments on The World, the largest residential ship on the planet.
“We go to great lengths to ensure our residences and experiences — whether a remote, four-bedroom home in Costa Rica or private villa in Tuscany — are meticulously vetted to eliminate any inconsistencies,” says James Henderson, CEO. “And because we own the majority of our core residential portfolio, we can customize and maintain every detail from the furniture and fixtures to the cutlery in your kitchen. For our four new residences at the Rosewood Mayakoba in Riviera Maya, Mexico, we even worked with the developer to ensure they have the floorplans our Members will want.”
Celebrating its 20th anniversary this year, Exclusive Resorts remains one of the only companies in the luxury villa space operating residential-style communities with its own on-site staff, including an experienced residence manager and concierge team. Together, this dedicated team takes care of all the chores of a second home — the grocery shopping, the cleaning, the upkeep — and covers everything from dinner reservations and activities to pre-arrival planning and daily housekeeping. They are even at the ready to handle last-minute changes due to flight cancellations or other unexpected delays.
For Members likes Marti Gistaro, who sold her vacation home and joined Exclusive Resorts in 2006, gaining access to the Club’s collection of staffed residences around the world felt like trading her brick-and-mortar asset for a far more valuable investment in precious time with family. “Our vacation home was becoming a headache to deal with; replacing it with Exclusive Resorts encouraged us to travel with our grandkids more regularly — and to new places every year,” she says. “We looked at it as an investment in our family vacations and a benefit to all of our kids, even after we’re gone. Exclusive Resorts has become part of our family legacy.”