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Tourism Management 31 (2010) 925–935

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Tourism Management

journal homepage: www.elsevier .com/locate/ tourman

Case Study

Causes and consequences of underutilised capacity in a touristresort development

Adrian Palmer a,b,*, Virginie Mathel b

a School of Business and Economics, Swansea University, Singleton Park, Swansea, SA2 8PP, UKb ESC Rennes School of Business, 2 Rue Robert d’Arbrissel, 35065 Rennes, France

a r t i c l e i n f o

Article history:Received 28 November 2008Accepted 1 December 2009

Keywords:Resort developmentSki resortsHoliday homesEconomic development, multiplier effects

* Corresponding author at: School of Business andsity, Singleton Park, Swansea, SA2 8PP, UK. Tel.: þ44

E-mail addresses: mail@apalmer.com, a.j.palmvirginie.mathel@gmail.com (V. Mathel).

0261-5177/$ – see front matter � 2009 Elsevier Ltd.doi:10.1016/j.tourman.2009.12.001

a b s t r a c t

There is a widespread presumption that the development of tourism resorts brings direct and indirectbenefits to the area where they are located. There has been extensive critical discussion about themagnitude and distribution of these benefits. This paper adds to knowledge of these benefits byinvestigating the causes of under-utilisation of tourist resort capacity, typified by the problem of ‘‘emptybeds’’. Many owners of holiday homes in tourist resorts choose not to rent out their property when theyare not making personal use of it, thereby reducing income earning potential of businesses in the area.This paper reports on a qualitative and quantitative study of holiday home owners at a ski resort inFrance. While personal use of properties was low, 40% of owners had never rented out their property.Analysis of the data converged on four emergent themes to explain this apparent reluctance to rent out:fears about the social habits of renters; issues of freedom and flexibility in use of their property; lifecourse changes which forced renting/non-renting decisions; and financial issues. Financial issues werenot a driver of investment/rental decisions, but derived from other social and lifestyle factors. The papermakes suggestions about how resort management can help to reduce owners’ reluctance to rent, andthereby alleviate problems associated with empty beds.

� 2009 Elsevier Ltd. All rights reserved.

1. Introduction

There is extensive research evidence linking tourism develop-ment to increases in local economic development (Deller, Mar-couiller, & Green, 1997; Frederick, 1993; Jordan, 1980; Marcouiller,Green, Deller, Sumaythi, & Erkkila, 1996; Milne & Ateljevic, 2001).The prospect of new infrastructure aimed at attracting new touristsis generally widely welcomed as a means of creating additionalemployment and economic benefits, either directly, or indirectlythrough a multiplier effect (Dwyer, Forsyth, Madden, & Spurr, 2000;Fritz, 1982; Green, Marcouiller, & Deller, 1996).

The number of people in developed economies owning secondhomes has increased in recent years, especially in areas likely toappeal to tourists (Muller, Hall, & Keen, 2004). A number of factorshave contributed to this, including rising real incomes, greateravailability of leisure time, often through earlier retirement ages,falling real transport costs and time, and social preferences.

Economics, Swansea Univer-1792 295 294.er@swan.ac.uk (A. Palmer),

All rights reserved.

Second homes have taken several forms, for example manyindividuals who work in metropolitan areas have another resi-dence, one of which may be a country retreat or a town ‘‘pieda terre’’ (Ong, 2007). Research into the impacts of second homes hasbeen fragmented, with multiple perspectives including theirimpacts on social structures in rural areas and economic multipliereffects (Muller et al., 2004). This paper focuses on a type of secondhome referred to generically as a ‘‘holiday home’’. It is difficult todefine a holiday home as a distinct subset of second homes, buta starting point is to define the category as a person’s non-mainresidence which is owned and used primarily for leisure relatedpurposes. The delimitation of holiday homes as a subset of secondhomes can be quite blurred, for example changes in work patternsand information technologies can allow what appears to bea holiday home to be used for work related purposes. Moreover, therole of second homes can be dependent upon local social andcultural traditions, for example Muller Hall and Keen note how insome areas second homes are utilised by extended families tomaintain ties to an area and can also operate as holiday homes(Muller et al., 2004). Holiday homes are defined here as a subset ofsecond homes, and used primarily for the purpose of a vacation,rather than part of an individual’s regular living and commutingpattern.

A. Palmer, V. Mathel / Tourism Management 31 (2010) 925–935926

Recent study of holiday home ownership has approached thesubject through the concept of individuals’ life course. It has beennoted that the majority of individuals owning a holiday home aretypically older than thirty five years and a significant proportion ofbuyers purchase their property for future retirement, even if it willnever be used as a main retirement home (Buller & Hoggart, 1994;Jansson & Muller, 2004; Muller, 1999; Quinn, 2004). Second homeownership has also been linked to migratory patterns, with indi-viduals migrating from places where they have made their wealth,to pleasanter residential or retirement environments, or to returnto their family roots (McHugh, Hogan, & Happel, 1995; Warnes,1992). From a social perspective, there is often an issue of an influxof holiday home owners changing the population structure in thearea, typically a high level of retired incomers has altered the agestructure and needs of the population (Mottiar, 2006; Moore,Williams, & Gill, 2006). An influx of older people may put a partic-ular strain on local authorities’ need to provide medical and healthservices.

This paper is concerned with the development of tourismresorts, which aim to create self-contained communities whereincoming tourists can find accommodation, entertainment, leisureand sports facilities and all of the supporting facilities for shopping,eating and moving about. Many such resorts are focused onmeeting the vacation needs of a market segment with particularinterests, for example resorts have emerged which focus on golf,beach holidays or skiing. One form of resort development that hasbeen popular in recent years is the ski resort, and which forms thefocus for this research.

The motivations for resort development have typically broughttogether a coalition of interested parties. Local authorities oftenbenefit through raising the taxable base of the authority, andfurther economic development may contribute to the alleviation ofa range of social and economic problems. Existing business ownersmay see benefits from attracting a greater number of people to theirarea. Representatives of labour may see benefits for increasing therange of job opportunities. An instigator of many resort develop-ments has been property developers, who see economic gainresulting from turning undeveloped agricultural land intocommercial real estate. Of course, many resorts are only developedfollowing fierce opposition from local interests, notably those whoperceive a threat to a lifestyle which they currently comfortablyenjoy (Gill, 2000). Furthermore, incomers who acquire propertiesin the face of local opposition may themselves become resistant tofurther development as the incomers’ attitudes mature andpermeate the host population (Moore et al., 2006). In some coun-tries second home owners do not pay property taxes to the localauthority, in others they do. This influences public opinion andpolicy in relation to second home development.

The starting point for this paper is the observation that coali-tions of interests that lead to the construction of new resortcapacity may typically be stronger than those that seek to obtaingreater economic and cultural benefits from properties that arealready completed. For a property developer, once a property hasbeen sold, it typically derives no further economic benefit from it.For purchasers of property within resorts, a variety of motivationsfor purchase lead to diverse economic benefits. At one extreme, aninvestor may see property purchase as a financially speculativeinvestment. Even if the property is boarded up and not used, theowner may gain substantial financial benefit in a rising propertymarket. If the property is simply sold on after a few years ofownership, the property owner would have benefited financially,without much benefit to the local economy, except perhaps forcontributions of local taxes and payments for building mainte-nance. At the other extreme, a property owner who inhabits theirproperty for a large part of the year, either using it for themselves or

their extended family, or by renting it to others, can contributesubstantially to the local economy. Their spending directly benefitslocal shops, restaurants and visitor attractions, and produces indi-rect benefits through a multiplier effect (Sinclair, 1998).

In between these two extremes is a group of property ownerswho have the ability to rent out their property, but use theirproperty (either for themselves or for paying guests), to only a verylimited extent. If a large number of property owners choose to keeptheir property unused there will be lost economic opportunities tothe local community. Whether such a loss of visitor numbers – andthe consequent loss of economic opportunity – is a good or badthing depends on the perspective of the local community and ofindividuals within it. The concern of this paper is restricted to thosesituations where dominant stakeholder groups actively seek topromote incoming tourism, in contrast to those areas whererestrictions may be placed on letting properties to tourists in orderto preserve the social balance of an area.

The aim of this paper is to gain a better understanding of whyowners of residential properties in tourist resorts choose not to rentout their property, in an environment where there is an activeproperty rental market. The answer to this question is an importantone for local authorities, and those charged with maximising thelocal economic benefits of tourism. If it can be shown that financialconsiderations are low in importance when property owners areconsidering renting out their property, financial incentives offeredby governments, such as tax breaks or penalties may have onlymarginal effect in changing the behaviour of owners. On the otherhand, if property owners have more deep seated concerns aboutthe concept of allowing other people to use their property, it isimportant that these concerns are thoroughly understood, andwhere possible, actions can be taken to address these concerns. Forexample, if property owners are concerned about damage to theirpersonal possessions being caused by strangers, this may beaddressed by designing properties with secure storage facilities forpersonal effects, and a property rental management service thatcan reassuringly protect the interests of property owners.

2. Ski resort development

Brillard (1999) generically defines a ski resort as a complexorganization that could not be associated with a particularcompany, but is constituted of a number of economic players withsometimes differing interests, or who may even be in competitionwith each other. Vles (1996) noted that ‘‘a ski resort is designed asa production and promotion system of leisure related goods andservices; formed by accommodation and equipment offering a largerange of services. The resort is managed as a town but also asa grouping of businesses’’.

It has been noted that in some communities where there hasbeen extensive resort development, a clear distinction existsbetween local residents and owners of second homes, who in someinstances have been likened to ‘‘second class citizens’’ (Halseth,2004). Having only a second home rather than a main home mayimply being excluded from certain citizenship rights. Consequently,second home owners may not be able to influence the local societyto the same extent as permanent residents (Hall, 2005). Moreover,Gartner (1987) and Green et al. (1996) have pointed out thatholiday home owners are often more opposed to developments intheir local area than permanent residents, and attitudes to resortdevelopment may progress through a phase of uncontested growthdominance, to a phase of local contestation that is then moderatedby the introduction of growth-management practices (Clark, Gill, &Hartmann, 2006; Gill, 2000; Moore et al., 2006).

When new resorts are planned, there are frequently highexpectations about the likely economic benefits (Green et al., 1996).

A. Palmer, V. Mathel / Tourism Management 31 (2010) 925–935 927

However, when completed, concern often focuses on the occu-pancy level of beds, rather than the number of new beds that aregenerated by the development. There is considerable evidence thatthe predicted numbers of visitor nights spent in resorts are notmatched by the actual numbers, with a high incidence of unoccu-pied rooms, or ‘‘cold beds’’. Marcelpoil (2006) noted in a study ofSavoy ski resorts that even though the resorts were considered tobe totally full during the season, this only took account of capacitymade available for renting and in fact only half of the total bedcapacity was occupied. Walpole and Goodwin (2000) have shownhow such under occupancy can dissipate the positive effect ona local economy. The problem of under occupancy during the peakseason is a particular problem for ski resorts, where the season istypically short, and many ski resorts have not developed as out ofseason destinations.

Properties unused during a significant part of the year result inlost economic opportunities and can create ‘‘ghost localities’’(Anrig, Bronnimann, Friedli, & Steinmann, 1985; Nicod, Mungall, &Henwood, 2007). The justification and support for building addi-tional resort residential accommodation is often that such buildingis necessary to cover the loss of earnings due to the unplannedincidence of unoccupied second homes during the season. By thisargument, the resort would only become sustainable in the long-term if further accommodation is built. However, rather than justoffsetting existing ‘‘cold beds’’, the additional development wouldcreate new ones (Fribourg & Machet, 2007). There is some evidencethat although the number of holiday apartments owned in resortdevelopments is increasing, only a relatively small, and constantproportion of these are rented out, with a rising number of ‘‘coldbeds’’ (Nicod et al., 2007).

There is also a suggestion that a large number of unused holidayhomes affects the appearance and perceived ‘‘cosiness’’ of a resort.It has been noted that a scattered settlement structure can make itless attractive and the often closed-up windows produce so called‘‘ghost neighbourhoods’’ (Bieger, Beritelli, & Weinert, 2007). Ina study of crowding in tourist destinations, Kyle, Bricker, Graefe,and Wickham (2004) observed a negative impact of crowding onservice quality. However, they also noted that a lack of people ina resort can lower service quality by restricting the availability ofentertainment facilities in a resort – if there are not enough peoplestaying in an area, a variety of facilities such as choice of restau-rants, theatre and cinema are less likely to be viable. It has also beennoted that unoccupied second homes lead to a lowering in thequality of tourism facilities, as reduced income leads to lessexpenditure on investment and maintenance of tourism facilities(Bieger et al., 2007). A further serious problem of under-occupancyis that public infrastructure has to be designed for a peak level ofutilisation. It may not be practical to plan electricity and watersupply etc. on the assumption that at any one time, a predictableproportion of properties will not be occupied, and therefore notdemand facilities. If all properties became fully occupied for briefperiods, for example at Christmas, this could lead to failure of theinfrastructure and undermine the quality of the resort for all visi-tors. Simply building more properties in order to achieve a highercritical mass of visitors may not be a problem where land fordevelopment is plentiful and an extensive pattern of developmentis not seen as a problem. However, achieving a critical mass throughextensification of development rather than intensification of usedoes not overcome problems of underutilised peak infrastructurecapacity.

2.1. Valmeinier resort

A ski resort development that typifies the problems describedabove is Valmeinier. Valmeinier district is located at the southern

end of the northern Alps, within France, and close to the Italianborder. The resort covers a total area of 5500 hectares and fourskiing areas are spread out from heights of 1500–2600 m. Since1998, a motorway has allowed easy access from regional towns inFrance and Italy. The first ski lift in Valmeinier was established inthe 1970s, but rapid development as a resort has only occurredsince the mid-1990s. The original centre of Valmeinier village islocated at a height of 1500 m and was renovated at the time ofski resort development. Valmeinier is defined as a ‘‘mountainresort’’ (Brillard, 1999) and in contrast to traditional ski resortsfound in the European Alps and other mountain ranges inEurope, is a purpose-built resort developed on previously vacantland rather than a historically grown ‘village ski resort’. Accord-ingly, apartments and small purpose-built ski-holiday homesdominate the accommodation sector outside the hotel segment.Much of the resort is located above the tree line, and the bare-ness of the summer landscape results in few major activitiesbeing available to attract visitors to the resort during summer. Itfollows that Valmeinier resort is dominated by holiday units builtprimarily for providing access to skiing facilities, and these aredistinct from second homes used as a ‘home away from home’(Jansson & Muller, 2004). Although improved motorways haveimproved access to the resort, it remains too far from the majorpopulation areas for substantial numbers of people to regarda home in Valmeinier as one that they can readily visit eachweekend. Because Valmeinier resort is built on previouslyundeveloped land, its potential for further growth is relativelyunconstrained by the physical and geographical limits to devel-opment present in many more traditional village ski resorts, orby cultural, social and political opposition that typicallyconstrains further development of ‘‘historic’’ village resorts.

In France, ownership of second properties in tourism areas is nota recent phenomenon (Jaakson, 1986). Between the early 1960s andthe mid 1970s the form and spatial structure of holiday homes inFrance underwent significant transformation as large scale,purpose-built holiday home developments in seaside and moun-tain resorts emerged (Mottiar, 2006). Many weekend travellerspurchased a vacation home in a multiplex dwelling or condo-minium (Fritz, 1982). The idea of owning a weekend refuge forrelaxation contributed to the development of holiday homes withineasy access of urban areas (Lundgren, 1974; Muller et al., 2004). Asa consequence, French second homes owners usually reside close totheir main home, and second homes which cannot be comfortablyreached for a weekend break remain an exception.

3. Summary of research aim

This study set out to understand the complexity of issues thatlead many owners of apartments in ski resorts to leave themempty, rather than occupying the property themselves, or rentingthem out to others. Only a limited amount of theory existed inthis area, so this study combined an inductive aim (developingnew theory), with a deductive aim (testing existing and emergenttheory, for example in relation to previous research criticallylinking holiday home ownership to a individual’ life course).Although the aim was to develop a generalisable theory ofholiday home renting, it was recognised that differences mayoccur between types of resort, therefore the research aim focusedon ski resorts in particular, within a European social, economicand geographic context.

4. Methodology

It was considered that the complexity of issues involved wouldbe lost in any research approach which was excessively structured;

Table 1Age distribution of the sample.

Age N¼ Percentage

25–34 2 2.335–49 19 22.150–64 41 47.765þ 22 25.6Not known 2 2.3All respondents 86 100.0

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therefore the aim was to gain depth of understanding ofrespondents’ attitudes, rather than to undertake a statisticallyrepresentative and generalisable study. Because of the lack ofexisting theory relating holiday home ownership with motivationto rent it out, the need to develop a theory called for a methodologythat is essentially qualitative.

The methodology used in this study was based on a combinationof phenomenological and quantitative approaches. The phenome-nological underpinning sought to understand – through systematicreflection and analysis – individuals’ structure of consciousnessthrough their own personal reflection rather than through theperspective of the researcher (Sokolowski, 2000). The methodologywas operationalised through individual interviews which sought tounderstand the meanings associated with individuals’ holidayhomes in their own words. This was corroborated with documen-tary evidence and a structured questionnaire survey. One-to-oneinterviews allowed the development of a deep understanding ofrespondents’ attitudes and behaviour, while providing insights intotheir lifestyles. The individual depth interview is particularly suit-able for exploring attitudes and beliefs which may be privately heldbut not readily articulated.

In inductive enquiry, it may be difficult, and inappropriate, todefine a basis for representativeness. In developing a sample for theone-to-one interviews, emphasis was placed on selecting partici-pants who could provide data rich in detail. Participants werechosen in accordance with the suggestion of Miles and Hubermann(1994:29) that ‘‘choices of informants, episodes and interactionsare driven by a conceptual question and not by a concern forrepresentativeness’’. Given this approach to sample selection, theresults can only allow a generalisation to theoretical propositionsrather than to a statistically reliable prediction of behaviour (Yin,1984).

Data collection was based on the ski resort of Valmeinier. Thecharacteristics of this resort were described in the previous section.This was considered to be typical of modern ski resort develop-ments, although the location in France limited generalisability toski resorts within a similar geographic, economic, political andcultural context.

In this study a total of 12 one-to-one interviews were used. Theprimary basis for selecting participants in this stage of the meth-odology derived from the focal interest of the study – ownership ofan apartment which was capable of being rented out, and in thecontext of this study, specifically owning a property in thecommunity of Valmeinier and not treating it as the participant’smain residence. Potential participants were identified frommunicipal records. Rather than being a statistically representativesample of all owners in the category, participants were selected fortheir ability to give insights from a number of perspectives. Theliterature had suggested that distance away from the main resi-dence and length of tenure were likely to be associated withdiversity of attitudes and behaviours, therefore these were used asthe secondary basis for selection (Bieger et al., 2007). No reliableinformation was available from municipal records relating to theage or life course of owners.

The form of analysis used here was based on the principlesproposed by Miles and Hubermann (1994) and Strauss and Corbin(1998), and was highly iterative in nature. Data collection andanalysis were consciously combined, and initial data analysis wasused to guide further data collection until a point of saturation wasreached. It is argued by Strauss and Corbin (1998) that thisapproach allows the researcher to increase the ‘‘density’’ and‘‘saturation’’ of recurring categories. The initial stage of open codinginvolved identifying, labelling and categorising data. The propertiesof each category were dimensionalised and required placing eachproperty along a continuum of values (for example, a feeling of

invasion of privacy was categorised according to strength of thatbelief). The following stage – axial coding – developed a system ofcoding that could identify causal relationships between categories.The final stage of selective coding involved selecting and identi-fying the core category (in this case renting out an apartment), andsystematically relating it to other categories. Successive iterationsof coding were conducted until internal consistency becameapparent

Interviews were recorded and transcribed, with dialogueinterpreted by two researchers. Respondents’ transcriptions werereviewed independently for clarification or expansion of ambig-uous points.

Further corroboration of data was provided by three structuredinterviews with key figures in the local community who had director indirect responsibilities for promoting and managing inwardtourism. These represented managers or senior officers of the localmunicipality; the local property letting agency, and the manager ofthe ski lift company. Additional corroborating data was collected inthe form of documentation produced by local organisations asso-ciated with tourism and local media coverage related to the localholiday apartment utilisation, with the aim of producing a ‘‘chain ofevidence’’ (Yin, 1984).

Quantitative research was undertaken to corroborate the find-ings of the qualitative research, and to seek new insights from thedata. The population from which respondents were drawncomprised all apartment owners in the resort of Valmeinier.A mailing list, comprising the names and permanent addresses of309 owners was obtained from the local municipality, which co-operated in this study. From these, 200 names were randomlyselected and sent a questionnaire to the owners’ main residentialaddress held on the municipality’s records. This was followed witha reminder letter, and for owners with a main residence in France,a further follow-up telephone call, where a telephone number wasavailable. It was decided to initially focus the limited financialbudget on 200 owners and to use available resources on follow-upcalls to these, rather than initially sending a questionnaire to all 309owners. 86, or 43% of the sample responded, and this higher thanexpected response rate contributed to the decision to not sendquestionnaires to the remaining 109 owners, in a previouslytentatively planned second phase of the quantitative survey.A small prize cash incentive of 50 Euros was offered to participants,which encouraged a high response rate. There is considerableresearch evidence suggesting that the offer of an incentiveincreases response rates (Church, 1993; Collins, Ellickson, Hays, &McCaffrey, 2000), and in this case, the incentive was felt not to biasthe response.

Characteristics with respect to the sample’s age, socio-economicbackground and area of main residence are shown in Tables 1–3.65% of respondents lived in provincial France and among theserespondents, three quarters had their main residence more than200 km from Valmeinier. 40% of respondents had never let out theirproperty. The typical respondent was likely to be retired, froma higher socio-economic group, living within provincial France, andenjoying the sport of skiing.

Table 2Socio-economic background of respondents.

Socio-economic background N¼ Percentage

Farmer 1 1.2%Craft worker/shopkeeper 1 1.2%Executive/company director 27 31.4%Professional 5 5.8%Government Officer 11 12.8%Retired 31 36.0%Other 10 11.6%Total 86 100%

A. Palmer, V. Mathel / Tourism Management 31 (2010) 925–935 929

The 86 respondents were felt to be a good representation of allproperty owners in the resort. Information about the population ofproperty owners was difficult to establish, because municipalrecords did not record significant socio-economic information. Inthe case of location of main residence, sample and population datawas compared, and an acceptably similar distribution observed(Table 3). In an attempt to further validate the sample, its charac-teristics were shown to the property letting agent within the resortwho agreed that the sample was broadly representative of allproperty owners in the resort.

The research instrument sought information in four main areas:property related data (type of property, length of time owned); datarelating to personal use of the respondent’s apartment and lengthof time, if any which it was rented out; and socio-demographicinformation relating to the owner. A number of attitudinal ques-tions were asked relating to the factors that influenced respon-dents’ decision whether or not to rent out their property. The scaleitems were developed from insights provided by the review ofliterature on holiday homes (e.g. Muller et al., 2004), and refinedfollowing the preceding one-to-one interviews. Respondents toattitudinal questions were measured using Likert scales. A copy ofthe questionnaire is shown at Appendix 2.

5. Research findings

The analysis began with coding of the interviews with ownersusing the approach described above. The data is organised aroundfour emergent themes.

1. Fears about the social habits of renters.2. Issues of freedom and flexibility in use of their property.3. Life course changes which forced renting/non-renting

decisions.4. Consideration of financial issues.

These issues are discussed below.

5.1. Social fears about renting out their property

Interviews probed the deep personal significance which ownersattached to their properties, and it became evident that owners had

Table 3Location of main residence – sample and population of all owners.

Location of main residence Sample All property owners

N % N %

Paris 4 4.6% 4 1.2%Suburbs 19 22.1% 57 18.5%France – provinces 55 64.0% 206 66.7%Foreign country 8 9.3% 42 13.6%All respondents 86 100.0 309 100.0

invested emotions in their properties and used their property toaugment their personal identity. Fear of strangers using theirproperty was a demotivator for renting out a property. Whenprobed, a variety of anxieties were expressed about the prospects ofhaving ‘‘strangers’’ staying in their property. Factors mentionedincluded people with different habits, including smokers, familieswith young children, house pets, different religions and countries oforigin. At a practical level, Mr. C, a 57 year old noted

‘‘We are frightened by damages that could be caused by letting, .we prefer for safety reasons lending our property to relatives’’.

Owners perceived it as a problem to have to store personaleffects in a locker when they rented out their property. Moreover,renting out was perceived to compel owners to furnish theirproperty with standard furniture and to have to adapt equipment totenants’ tastes. Although owners may have preferred to buyattractive, high quality furnishings to suit their style and person-ality, the fear of degradations and thefts contributed to a feeling ofanxiety by the owners. One owner, Mr H, who had owned hisproperty for seven years noted that

‘‘we have tastefully furnished our flat, we do not wish to let it ’’, and‘‘our furnishings are an expression of our personality and we do notwant to change this for people who we don’t even know.’’

Probing sought to establish whether owners’ anxieties aboutletting strangers into their properties had rational bases. Theemotional basis of such anxieties was expressed by Mr H who hadnever rented his property, but claimed that

‘‘I would not like the idea of somebody who I do not know sharingthings which I value personally’’

It was evident that an individual’s holiday home had deepsymbolic significance which went beyond economic rationality.Respondents’ emotional attachment to their personal possessionsmay be consistent with recent research in the field of culturalmaterialism that conceptualises an individual’s possessions asbeing an important means of creating personal identity. It has beennoted, for example by Rindfleisch, Burroughs, and Wong (2009)that materialistic individuals form strong connections to theirbrands and possessions as a response to existential insecurity(Rindfleisch et al., 2009). Theorists have also suggested that thepursuit of material possessions, symbolised by an underutilisedholiday home, is a response to dissatisfaction with life and alien-ation from sources of value traditionally founded in institutionssuch as the family and religion (Solberg, Diener, & Robinson, 2004).

Some corroboration of respondents’ sentiments was found inthe quantitative survey, which indicated that over half of respon-dents who hade never rented out their property considered theissue of intrusion into personal effects to be important to them intheir decision not to rent (Table 4).

The importance of intrusion into personal space was alsocorroborated by the interview with the property letting manager,who described the highly emotional state of owners complaining incases where personal possessions had been damaged, in contrast todamage caused to utilitarian features, such as plumbing or basicelectrical equipment.

5.2. Perceived flexibility of use

The ability to visit their property at any time without having tofit around prearranged rental agreements appeared to be animportant factor deterring participants from renting out theirproperty. On first analysis, this emerged as a distinct underlyingdemotivator for renting out a property, and many participants

Table 4Non-renting respondents’ rating of the importance of intrusion into their private life as a reason for not renting.

N No response Without importance Not much importance Important Quite important Very important

Non-renters 43 0 8 13 4 8 10

A. Palmer, V. Mathel / Tourism Management 31 (2010) 925–935930

rationalised this as a primary reason for not doing so. However,with further probing, the apparently rational basis for not rentingmay have been hiding deeper seated feelings for freedom andpersonal identification with their property. By committing toa rental agreement, there was a perception of a reduced ability toachieve valued social objectives. This was expressed by Mrs. S, a 66year old, who noted

‘‘My children and I usually make the decision to come to Valmeinierfor the weekend only on Friday evening, if the weather is favour-able. Opportunities for getting together with my family would bereduced if the apartment had previously been rented out’’.

and

‘‘this is my space, and I do not like to think that other people canlimit my use of it’’.

There was perceived to be a lack of flexibility in the way that theresort booking office only rented properties for seven consecutivedays from Saturday to Saturday, thereby not allowing owners toreconcile family and personal preferences.

The ability of owners to visit their property at short notice alsoappeared to be related to the distance they lived from Valmeinier.For those living far away, especially in a foreign country, a visit totheir property of necessity became a planned rather than a spon-taneous event. Distance also affected the way owner’s appeared tomanage their property, with less chance of them being able toundertake their own maintenance, or to visit the property if anemergency arose. Mr D, a permanent resident of a French overseasdependent territory, and owner of a flat in Valmeinier visited hisapartment once every three years when his budget allowed andstated

‘‘Renting out our flat is not a problem for us as we plan our visit toValmeinier a long time in advance. Another thing worthmentioning is that renting out our apartment allows us to keepoccupancy in the apartment and at the same time maintain it ingood order (the booking office is in charge of it). This reduces thechances of meeting nasty surprises, such as leakages or electricproblems when we come back.’’

To explore further the influence of owners’ main residence ontheir perceived flexibility, responses to the questionnaire surveywere examined. The average level of personal occupancy for allowners was 5.39 weeks per year. However, there was a notabledifference between owners who lived abroad and on average onlyused their property at Valmeinier for 1.39 weeks per year, and thoseliving closer in suburban and provincial France who used theirproperties for 6.11 and 5.56 weeks per year respectively (see Table 5).

Table 5The relationship between the location of owners’ main residence, and the number of we

Location of mainresidence

N¼ Personal occupancy by own– average number of week

Paris 4 5.00France – suburbs 19 6.11France – provincial 55 5.56Foreign countries 8 1.83Total 86 5.39

An opposite effect was found in respect of the number of weeks thatowners rented out their property commercially. Foreign ownersrented out their property on average for 8.00 weeks per year, muchhigher than owners from Paris and suburban France whom wereable to travel at short notice to the property (2.75 and 4.37 weeks peryear respectively). The actual distance between Valmeinier andowners’ main home was calculated and a correlation analysis relateddistance to personal occupancy of the apartment, and the number ofweeks that their apartment was let out commercially (to avoidoutliers, owners of properties in non-contiguous foreign countrieswere excluded from this analysis). Neither correlation was signifi-cant. To illustrate the distribution, a scatter plot relating distancefrom main home with the number of weeks that a respondent’sproperty was rented out is shown in (Fig. 1).

5.3. Life course changes

The decision whether to rent out an apartment often coincidedwith changes in the owner’s circumstances, compared to thosethat pertained at the time of purchase. There was no consistenttheme to the reasons why change in life circumstances may havechanged individuals’ motivation to rent out their apartment, buttwo apparently opposing forces appeared to be at work. Firstly,some owners originally bought their apartment as an investment,and at an early stage in their career, and may have needed rentalincome to offset their mortgage costs. However, as they becamemore affluent, or approached retirement, their financial needsbecame less, and their availability of leisure time to use theapartment for personal use became greater. This view was sup-ported by evidence that older owners spent more time in theirproperty, with 25–34 year old owners occupying their propertyfor an average of 1.1 weeks per year, compared with 4.1 weeks for35–49 year old skin; 5.7 weeks for 50–64 year olds, and 6.5 weeksfor those aged over 65 (see Table 6). To explore whether thedifferences between age groups were significant, Chi-square testswere undertaken to compare the actual distribution of weeks peryear for each age group, with a hypothetical distribution of weeksper year based on an assumption of uniformity for all groups. Chi-square statistics of 0.03 and 0.02 provided support to reject a nullhypothesis that age is unrelated to either frequency of occupancyby the owner or by friends and relatives respectively It should benoted that there were relatively few respondents in the 25–34 agecategory, and the relatively low level of personal occupany(and high level of occupancy by family and friends) may beregarded as an outlier.

The opposite force derived from people who had originallybought their apartment for personal use, but were no longer able to

eks per year that they occupied their property, or let it out commercially.

er or friends/familys per year

Commercial rental of property by owner –average number of weeks per year

2.754.375.298.005.15

Fig. 1. Scatter plot showing the relationship between the location of owners’ mainresidence, and the number of weeks per year that they let out their propertycommercially (owners with their main residence in a non-contiguous foreign countryhave been excluded from this analysis).

A. Palmer, V. Mathel / Tourism Management 31 (2010) 925–935 931

use it to the extent originally envisaged, therefore renting out wasseen as an alternative use, short of selling it. This was illustrated byMr. S, a 67 year old living in France who justified his motivation torent out his property with the following observations

‘‘My wife no longer wants to come to Valmeinier. We are now botholder and unable to take part in the winter sports as we used to.Renting out our property for holidays is a way to get a return on ourinvestment’’.

Also, Mr A, a, 66 year old noted:

‘‘After my husband died, my life is changing the use of myapartment’’.

And Mr. D, a 56 year old owner for 12 years of a holidayapartment

‘‘This apartment was until now a place of friends and relativesreunion, it is nowadays becoming a financial product that willpermit to help my son to settle in Switzerland’’.

11,6%

2,3%4,7%Without importanceNo much importanceImportantQuite important

5.4. Financial issues as a motivator to property rental

The prospect of generating revenue may at first sight appeara significant motivator for people to rent out their properties. (Fig. 2)indicates that for the majority of people (55.8%), return on invest-ment was seen as important. However, interviews suggested thatthe nature of the financial motivation was quite complex. In

Table 6The relationship between owners’ age, and the number of weeks per year that theyoccupied their property, or let it out to friends and relatives.

Age of owner N¼ Personal occupancyby owner – averagenumber of weeks per year

Occupancy by friends andrelatives – averagenumber of weeks per year

25–34 2 1.00 5.5035–49 19 4.00 2.9550–64 41 5.66 2.9865 þ 22 6.50 3.45All respondents 84 5.39 3.15

particular, there appeared to be an association between an owner’spropensity to rent out their property, and their age and length oftime that they had owned their property.

Among the 43% of respondents who rented out their propertyfor four or more weeks per year, 74% stated that economic factorswere an important or very important reason for their decision torent out. Among the respondents in the age group 25–34, 90%considered repayment of mortgage interest as a very importantfactor in their decision to rent out their property. This factorbecame much less important for older people, with only 23% ofretired people stating that they rented out to repay their mortgage.Among this group, the main economic motivator for renting outtheir property was a desire to cover ongoing costs of ownership, forexample, taxes and maintenance charges. One owner, Mr S statedthat ‘‘renting out allows an additional income to our pension’’ andanother that property rental ‘‘helps us to finance our children’sgraduate studies’’ (Mr D). Some also spoke about tax advantages ofinvestment.

Among property owners who did not rent out their property,81% claimed that financial issues were either ‘‘not at all important,or ‘‘quite unimportant’’ factors in their decision about whether torent. The profile of non-renters suggested less financial need thanrenters. 37% of non-renters described themselves as ‘‘retired’’; 34%described themselves as having ‘‘executive’’ or ‘‘managerial’’ posi-tions, and 60% indicated that they presently had no dependentchildren.

Fig. 2 presents a summary for all respondents of the expressedimportance of financial reasons for decisions whether or not to letout their property commercially.

6. Discussion and management implications

This research began with an observation that the presence of‘‘cold beds’’ was reducing the financial viability of resorts,because spending power which should have derived from thebed capacity of the resort was reduced through the absence ofproperty owners. These owners choose to make only verylimited personal use of their property, and do not let out theirproperty to others. Under-utilisation of apartments during theheight of the season not only results in loss of revenue totourism related businesses in the area, but can also underminethe atmosphere of the resort, with fewer available touristsleading to less of a ‘‘buzz’’, and narrowing the range of enter-tainment and leisure facilities offered by companies. Under-standing why owners choose not to use their property, or let itout to others is important for maximising the economic benefits

55,8%

25,6%

Very important

Fig. 2. Summary of property owners’ responses to the question "how important isfinancial return on investment in your property?" (n ¼ 81).

A. Palmer, V. Mathel / Tourism Management 31 (2010) 925–935932

of tourism, where such benefits are actively sought by keystakeholders. In the absence of high levels of utilisation, manyresorts have taken the alternative step of building yet moreapartments, to make up for the under-occupancy of existingapartments. This study has focused on a relatively new resort inwhich increasing the level of tourism is seen as beneficial bya broad range of stakeholders. It must be borne in mind that inmany tourist areas, preserving local cultural identity may beperceived as a more important objective than maximising uti-lisation of tourism facilities. In such situations, the presence of‘‘cold beds’’ may be seen as a benefit rather than a problem. Thisstudy has also presumed that the economic consequences ofpursuing policies to reduce the number of cold beds wouldactually be beneficial rather than harmful. Warnker and Guildingnoted, in the context of multi-owned tourist facilities thatreducing empty beds by offering discounted prices in a targetedsector of the accommodation spectrum without appropriatelystimulating demand through other means can lead to a generaldrop in the price level (and margins) across other sectors and,ultimately, reduction in the competitiveness of a whole desti-nation (Warnken, Guilding, & Cassidy, 2008). Furthermore, thismay harm the image of the resort and cause long-term economicharm as a result of this worsened image

This study has used a combination of qualitative and quanti-tative techniques to understand the reasons why property ownersare reluctant to let their properties to other users. An importantfinding of this study is that financial reasons appeared to havebeen only a secondary factor in influencing property owners’decisions. This finding was consistent with previous research ofBuller and Hoggart (1994), and reference to financial planning forretirement appeared to be a post hoc rationalisation, rather thana conscious motivator. However, there appeared to be a life courseeffect, with younger owners more likely to rent out their property,owing to their relatively high level of indebtedness. For olderowners, who were the majority of apartment owners in Val-meinier, issues related to individuals’ identity with their propertyemerged as the main demotivator for renting the property toothers.

In the short-term, a number of respondents made practicalsuggestions that might increase their likelihood of renting out theirproperty. A more flexible booking system which allowed owners torent out their property at short notice might overcome their feelingof not being able to use their property for impromptu breaks,thereby denying them the opportunity to share time with familyand friends when opportunities suddenly arose. The interviewssuggested that the need to make spontaneous decisions sometimesreflected spontaneity on the part of friends and family memberswhose plans could not be easily taken into account if a rentalschedule had to be agreed several months in advance. Furtherflexibility could be provided by more flexible booking opportunitieswhich didn’t restrict rentals to those that started and finished ona Saturday.

In the medium term, change to the design of properties mayhelp to alleviate owners’ fears about renting out, for example byproviding safe storage areas for personal possessions. Owners’ needfor flexibility may be improved by offering a choice of rentalagencies. Respondents voiced criticism about the existing soleagency, noting that competition might improve standards ofservice and better accommodation of their needs. However, it mustbe recognised that for many owners, close identification with theirproperty as personal, private space, and social fears about renting itout are significant barriers for economic or management incentivesto overcome.

In the longer-term, the issue can be raised about whetherlocal planning approval should more rigorously specify

conditions for subsequent use of a new development. Ifownership remains with a property management company, thecompany would probably be more likely to rent out the propertyas much as possible, rather than allowing it to remain vacant forthe personal reasons that were disclosed by owners in thisstudy. It was also suggested by the local tourism office thatcorporate ownership would be more likely to maintain proper-ties in good order, thereby overcoming the problem of manyproperty owners allowing the furnishings and decor of theirproperties to become dated and less attractive to renters.However, this assumes that alternative corporate investorswould be available to take the place of private individualinvestors. If such corporate investors are not forthcoming,underutilised privately owned apartments may provide greaterlocal economic benefit than no investment at all.

Some aspects of the research have confirmed emerging theory,for example in respect of the association between an individual’slife course and their ownership and usage of a second/holidayhome. Other aspects of the research have contributed to thepossible building of new theory, for example in respect of socialfears about unknown guests using what is perceived as personalspace. A holiday home may have complex symbolic significance toits owner which is not adequately explained by models of economicrationality. Discourse on existential materialism may explain indi-viduals’ pursuit of a holiday home as an important means ofcreating personal identity. Allowing a holiday home to remainunderutilised may symbolise the value of possessions for their ownsake, and under-utilisation may not be regarded as a problem if thesymbolic value of ownership is nevertheless maintained (Solberget al., 2004).

Further research is required to further the development ofa possible new theoretical model for understanding how asso-ciating a second home with some groups of people maystrengthen an individual’s identification with the property, whileassociating it with other groups may undermine it. It was notedearlier that sociologists’ concept of an ‘‘in crowd’’ and ‘‘out-crowd’’ (Muncie, 2001). Twenge and Campbell (2003); Larkin(2007) may help to explain the selective processes by whichproperty owners are only happy allowing their property andpersonal possession to be shared with people whose values theyassociate with, rather than with those groups whose values –either presumed, or based on experience – are seen as formingpart of the owner’s ‘‘out-crowd’’.

Appendix A. Map of valmeinier

A. Palmer, V. Mathel / Tourism Management 31 (2010) 925–935 933

Appendix B. Copy of questionnaire

A. Palmer, V. Mathel / Tourism Management 31 (2010) 925–935934

A. Palmer, V. Mathel / Tourism Management 31 (2010) 925–935 935

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