Best Vacation Places To Buy An Investment Rental Property
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If you’re in the market to buy a vacation property (awesome for you!) it might be in your best interest to buy in an area where it might also be a good investment as a rental property. Where do the best vacation/income property opportunities exist? Let’s dive in, because some of these investment property locations might not be what you would expect.
Research firm Technavio foresees the global vacation rental market growing nearly $63 billion between 2020-2024.
With travel expected to return to near pre-pandemic levels, there is a large segment of the U.S. population that will likely only travel domestically – which could open investment opportunities. However, certain vacation areas will deliver more return on investment than others.
Evolve – a vacation rental booking platform – just released an analysis of the best vacation places to purchase a real estate property, based on the median annual revenue of its own rental listings and on median home values from Zillow data.
10. Windham, New York
Windham – the “gem of the Catskills” is a town three hours north of New York City – known for its wine bars and art galleries.
Median home listing price: $459,500
Median annual gross rental revenue: $46,573
9. Ruidoso, New Mexico
Ruidoso is a charming Southwestern town known for being a ski destination nestled in the Sierra Blanca mountains.
Median home listing price: $243,458
Median annual gross rental revenue: $21,827
8. North Conway, New Hampshire
North Conway is another ski resort town that boasts year-round respite for nature-seekers.
Median home listing price: $356,946
Median annual gross rental revenue: $39,002
7. Waldport, Oregon
Waldport is an Oregon coastal town that offers whale watching in the Pacific Ocean, but is also close to national forests.
Median home listing price: $380,728
Median annual gross rental revenue: $41,182
6. Branson, Missouri
The Midwest vacation spot snug in the Ozark Mountains features country music performers and Dolly Parton’s Stampede.
Median home listing price: $179,724
Median annual gross rental revenue: $21,596
5. Surfside Beach, Texas
Surfside Beach is a seaside town in Texas on the Gulf of Mexico.
Median home listing price: $277,642
Median annual gross rental revenue: $41,688
4. Bryson City, North Carolina
This laidback small town is the gateway to the Great Smoky Mountains that borders Tennessee and is near a national park.
Median home listing price: $194,326
Median annual gross rental revenue: $31,818
3. Sevierville, Tennessee
Sevierville is a Tennessee town that boasts tourist attractions such as Dollywood and the Great Smoky Mountains National Park.
Median home listing price: $296,966
Median annual gross rental revenue: $51,228
2. McGaheysville, Virginia
McGaheysville is situated near Shenandoah National Park and the Appalachian Trail.
Median home listing price: $265,479
Median annual gross rental revenue: $48,838
1. The Poconos, Pennsylvania
The Poconos has a variety of shopping, entertainment and outdoor activities with lakes and mountains nearby.
Median home listing price: $198,667
Median annual gross rental revenue: $41,699
Jeremy Kisner – a senior wealth adviser at Surevest Wealth Management in Phoenix – told RisMedia that those getting into the investment property game should be prepared to stay for the long haul to enjoy growth.
“The way that people get in trouble with almost all investments is, they just don’t hold onto things long enough,” Kisner explains. “With rentals, if you break even on a cash-flow basis, that’s actually not too bad because you’re paying down the principal and building equity that way. Then, you hopefully also see some appreciation.”
Kisner admits that rental properties can be a dangerous gamble since you’ve got to factor in maintenance costs and costly evictions. But he notes that if you continue to hold onto your properties, they will reward you with a profitable ROI.
“If I hold them until I turn 60 when they’re paid off, even after property taxes and insurance, I’ll double my Social Security income,” Kisner says.
You can see the entire list of best places to buy a vacation rental in 2023 at Evolve.