Oceanfront destinations continue to be the most desirable home locations, according to the results of a survey conducted by EscapeHomes.com, with seven out of 10 coastal towns making the Top 10 list. In addition to several properties in Florida, the list also includes Napa Valley as one of the most popular areas for those seeking a second home.

Another survey conducted by the National Association of Realtors showed 76 percent of vacation homeowners wanting to be near an ocean, river or lake, while 38 percent chose the mountains or other natural attractions. Distance is another priority for buyers. Most vacation homes are located near the owner's primary residence, with a median distance of 185 miles, though one-third are more than 500 miles and one-third are less than 100 miles away.

Locally, Realtors are seeing a surge in second home purchases with destinations ranging from nearby coastal towns to out-of-state locations.

"We are seeing a large number of second home purchases. It is an interesting phenomenon, because in my 25 years as a Realtor I have never noticed the second home marketplace to be so strong," said Realtor Brian Kessler of Intero Real Estate Services in Los Gatos.

Kessler, who had a client who just purchased a beach home in Aptos, is currently helping another client look for a second home in the Pebble Beach/Carmel area. Some of his clients have also purchased second homes in Maui, Palm Springs, Tucson and Lake Tahoe.

"A great aspect of this segment of the market is that mortgage lenders give the same favorable interest rate on a second home as they do on a primary residence," Kessler said. "Buyers feel strongly that a second home is a great real estate investment and a fun place to get away and enjoy life."

Certified Mortgage Planner Judy Hamilton, with Bankers Network in Campbell, is also seeing more people buying second homes, most often with interest-only loans or other options. She finds there can be financial advantages with a second home purchase.

"The government still allows us to write off the interest on a second home along with our primary residence as long as we do not exceed $1.1 million in loans," Hamilton said. "Buying now allows baby boomers the opportunity to freeze their retirement home cost and still have an income to make the payments."

Hamilton said one of the most popular destinations for her clients seems to be Arizona since the weather is good and the prices are still fairly reasonable.

"I have seen my customers be able to own a place under $400,000 in a beautiful setting, with golf and other activities. They are renting these homes out until they retire and plan on moving there at that time. It's not expensive to fly [there] and takes only a little over an hour, so if they have family here it still feels close enough," Hamilton said.

Realtor Jose Gambera of Prudential California Realty finds Las Vegas is a popular choice for second homes. Other places are appealing to seniors as they explore retirement options.

"Since the property values have gone up so much, clients are turning to tried and true places like the Palm Springs area. These are all mostly baby boomers and seniors looking to eventually retire," Gambera said. "A few have chosen the Raleigh-Durham area of North Carolina as an affordable second home and retirement choice since it offers cultural amenities and could be a possible job change site."

Other vacation home options include time-share suites or condos in luxury hotel complexes that some families find convenient for vacations and quick trips.

Gambera cautions homebuyers against renting out the second home property, since sometimes it is more trouble than financially beneficial. "It's better to have a reliable professional or year-round neighbor keep an eye on the property for a fee," she said.

Real Estate Broker Jim Magill of Village Square Realty says vacation homes appeal to those who are financially secure and have equity built up in their homes. "It's about an experience, not just making an investment," said Magill, who recommends that people look at the big picture of both their financial and personal lives.

When considering a second home as an investment property, CEO David C. Hehman of Escapehomes.com recommends buyers investigate all the angles. "I fully agree with the Warren Buffett quote, 'An investor's success is in direct proportion to the degree to which he or she understands the investment,' so get educated."

Buying a home for investment purposes is very different from buying a primary residence, Hehman said. "It's a different process and you need different information. So the first thing I would suggest is research, research, research. Know why you want to buy and what you want from the experience. Be realistic about both costs and expectations. And find a great Realtor to walk you through the process."