This substudy hypothesized that irrespective of supply and demand, determinants exist which establish preferences for certain vacation or second home sites. Amongst these preferences are: proximity to unpolluted water with recreation potentials; a non-urban setting, preferably a wilderness area accessible to the permanent home location; a setting of some natural beauty with a combination of vegetative and topographical variety. Two lakes were selected to test the first variable, taking care to ensure all the other variables were held constant. The study found that (a) considerable recreational limitations occurred on the polluted lake due to physical and psychological factors (b) respondants were adverse to admitting that water was polluted and in any event discounted the deleterious environment effects of polluted water (c) configuration of shoreline, topography, orientation and access were noted as determinants of house location (d) morphology of water body interaction of shore configuration and water surface suggests important locational determinants and stimuli for community growth (e) building condition and building location are not necessarily functions of supply and economic factors.