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A welcome flag and two chairs in the front yard invite guests to this home as homeowners unpack for their stay. Full or part-time resident? Some think the terms are divisive when all want what's best for their community.

COURT HOUSE – Some second homeowners buying in Cape May County are looking to enjoy all the area has to offer, but also want a say in how property taxes are used.  

More than half of all second homes in the state are located within the county's 620 square miles, of which 60% is water.

With 30 miles of beaches and five barrier islands built up as seaside resorts, the area has attracted settlers for more than 325 years for the same reason people come today, according to the Cape May County Department of Tourism.

However, the people who are settling in the county and buying single-family homes or condos are changing. In addition, some of those who spend part of the year in the county are looking for a say in how their property-tax dollars are spent year-round, an issue that can divide year-round and seasonal homeowners.

Hot Market

"The market is very hot," noted Damon Bready, president of the Ocean City Realtors Association.

Last year (2018), from January through July, 508 single-family homes and condos sold in Ocean City, with an average price of $614,021. So far this year (2019), 479 properties have sold, for an average price of $660,942.

Bready said the city's family-resort image and dry-town status are among the reasons people buy seasonal homes; good schools, low taxes, and a "minimalist lifestyle" attract year-round homeowners. 

Ocean City was ranked in the top spot for the second year in a row of the ‘Hottest Secondary Home Markets in the U.S.’ by SmartAsset, a New York-based financial technology company.

According to a SmartAsset study published in March 2019 (http://bit.ly/2xMY9G9): Nearly 80% of all homes bought in 2017 in Ocean City were bought as non-primary dwellings.

"We're losing our rental inventory because buyers are really using their homes as second homes," said Bready, about the northern-most seaside real estate market in the county. "To me, this means old money, the buyers are using inheritance or the Baby Boomers are cashing out.

"They are looking for brand-new homes, or recently renovated homes, where they can just move in with their bathing suits," he added.

Rentals Also Command High Rates

Among those who buy in the rest of the county, according to James Cheney, vice president of sales and appraisals for a Cape May realty company, "there is a mix of folks who purchase with the definite idea in mind to rent out their properties by the week in the summer in the beach towns, or year-round in the mainland communities.

"But, as a real estate broker for over 20 years in this local market, I can also tell you that many buyers’ plans change once they move forward with a purchase," he noted. "Many buyers who didn’t intend to rent, will end up taking rentals, at least for the first three to five years after purchasing, once they realize the rental rates their properties will command.

"Being willing to take rental income also tends to stretch buyers’ budgets for their purchase here, providing buyers with a lot of help with their mortgage payments or other carrying costs of owning a second home," Cheney said.

Cheney provided statistics from the Cape May County Multiple Listing Service (MLS), "which are deemed reliable but not guaranteed: Through June 30, 2018, 849 single-family residences were sold for an average of $576,474. This compares to 845 single-family residences sold in 2019 through June 30, for an average of $577,760.” Ocean City is a separate MLS.

Through the first half of last year, 688 condos were sold for an average of $428,582 compared to 640 sold through June 30, 2019, for an average of $435,020, he said.

Fresh Fish, Water, Vacations

According to the county Department of Tourism, Ocean City, the Wildwoods and Cape May were barrier islands used by whalers as stopovers to gather freshwater and food during the 1700s. The islands were inhabited by the Lenape Indian tribes and as grazing areas for cattle and camps during the summer for fishing.

Later, in the mid-19th century, the resorts became seaside resorts, attracting upscale visitors and catering to wealthy business owners who escaped the hot cities to summer by the sea. Many of the resort towns of today were small fishing villages that attracted visitors during the summer.

Today, approximately 47% of the dwellings in the county are second or vacation homes, according to the Department of Tourism. "These homeowners come for the beaches and lifestyle, more importantly, they pay property taxes and don’t send children to our schools," noted the report for 2019.

"From a homeowner’s perspective, tourism may seem bothersome, with too much traffic, crowded beaches and long waits at restaurants, but it is documented in New Jersey that without it, each household would pay $1,545 more in taxes."

A Seasonal Tourist Destination

The statewide average is 330 travelers support one job, according to the Department of Tourism. Direct tourism employment in Cape May County provides 26,572 jobs. Tourism is the seventh-largest industry in New Jersey, and the largest industry in Cape May County.

Despite some "excellent efforts being made by our county officials promoting economic growth as a whole," Cheney said, "Cape May County, and in particular the beach towns and the southern end of the county, currently does not have a very well-diversified economy. We are still largely a seasonal tourist destination.

"Very few people get relocated to Cape May County for year-round employment purposes," he noted. "Hence, a much more typical reason for our buyers, who buy here, is for second home/vacation home use and, to a lesser extent, strictly for investment purposes. There are also a fair amount of folks who retire to our county.

"Many buyers purchase here while still working, using their Cape May County property as a second home or rental property and, then, eventually segue into full-time residents upon their retirement and selling their primary residence elsewhere."

Having a Say in Spending

Dan Giffear, Jr. moved to West Wildwood 20 years ago for the "beach and serenity" the area offered him in his "retired, peaceful life."

He joined the Concerned Taxpayers of West Wildwood (CTWWW), started by second homeowners whom he credited with bringing to light a number of controversial actions taken by the borough's commissioners.

Giffear believes part-time residents have the same financial interests in how their tax dollars are spent as full-time residents. He advocated for voting rights in some form for second homeowners.

The organization has more than 300 members, according to its president Trish Sinnott, after starting as "seven sitting on a curb" after a borough meeting last summer.

West Wildwood tax rolls show 981 ratable (taxable) properties - 177 vacant land, 793 residential and 11 commercial lots. Of these, 77% have an out-of-town mailing address for tax bills.

"It's crazy, we share a street but we're viewed as different," said Sinnott. "Our goal is to unify everyone because we all want the same thing: safe sidewalks, nice parks, and benches, proper street lights. These are our homes where we have celebrations, our family get-togethers, our parties.

Voting Rights an Issue

"To be called full- or part-time, or seasonal, is a divisive maneuver," Sinnott added. "Call me taxpayer, friend, citizen, neighbor. There are a lot of talented people on the island who can help put their heads together and come up with ideas to help move the island forward."

Their short-term goal is to "work together with the commissioners to create what's best for the island today and three to five years down the road," Sinnott said. "Long-term, voting rights in both locations where we own homes.

"If you want my dollar, then I want a vote," she said. "It's a much bigger issue and I understand it's complicated. We formed because our taxes were going to increase.

"Everyone needs to understand that behavior has consequences. And we all want what's best for our community," Sinnott continued.

According to Michael Kennedy, registrar with the county Board of Elections, by law, people can only be registered to vote where their domicile is.

"Our office has a series of questions that we ask, such as whether a person receives the homestead exemption, where they pay federal taxes and where their driver's license is from," he explained. "Today, our office is connected to the motor vehicle office, so we're notified right away when a license is changed. Our board reviews these requests to register all the time because of all the second homeowners here, but the law is very clear. You can only be registered to vote in one place."

To contact Karen Knight, email kknight@cmcherald.com.

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