Natick Condominiums

Editor's note: The second-home or vacation-home market is a booming niche that's vastly different than the market for primary homes. Many foreign buyers are playing a larger role in second-home purchases in the U.S., while many domestic buyers are crossing the border for their second homes. In this three-part series, we examine the fast evolving second-home market, looking at the trends of foreign buyers coming to the U.S., U.S. buyers looking outside the borders, and how booming second-home markets impact affordability for everyone else. (See Part 1: Florida says 'cheerio,' 'hola' to international real estate buyers.)

Though prices haven't skyrocketed quite as high, resort town Tahoe City, Calif., also dominated by second homes, has seen effects similar to those in Nantucket and Aspen, a local Realtor said.

In the past five years, the prices have gone 'way up, driven by the second-home market," said Tim Hauserman, a Realtor in Tahoe City. "The locals haven't been able to buy a home because the prices are so high. Many of them are moving out of town."

The average price of a home in Tahoe City, which is close to Lake Tahoe, a popular destination known for its pristine lake, is $700,000 or more, Hauserman said. "About five years ago, it was half that."

People from the San Francisco Bay Area buying second homes for vacation homes are behind the price jumps, Hauserman said.

"This has affected our schools. My daughter's high school has lost about 10 percent of its students because people have moved away," the Realtor said.

"Businesses that cater to second homes do better, businesses that cater to locals have more of a problem," he said. "High-end home furnishings, for example, would do well, but the low-end wouldn't do as well."

Restaurants "do fine" when second-home owners and tourists are in town, but not so much on the off-season, he said.

"The biggest effect on the locals is that it's hard to find employees for businesses," Hauserman said. "Teachers – unless they have lived here a long time, they can't afford to buy a house. They move to communities that are less expensive nearby.

"We have people commuting from Reno 45 miles away," the Realtor said.