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While the super-charged real estate market has slightly cooled in 2022, many people are still on the lookout for the best places to buy a vacation home in America. Based on the mortgage rate lock-in numbers, second-home demand is still 35% greater than pre-pandemic levels.
The National Association of Realtors released a new study that included rankings of the country’s top 1% of counties for vacation homes. Based on approximately 30 markets, the study looked at sales growth, the number of seasonal homes available compared to the previous year, and changes in days on the market.
From Arizona to New York, Palm Springs to South Carolina and Orlando, we looked at cap rate (return on investment). We provided the crucial details that make these locations ideal vacation home areas.
Whether you’re in the market for a second home for your family or Airbnb vacation rental income, here are some of the top spots to buy a vacation home.
Seaside, Florida
Nestled along the Emerald Coast—known as the crown jewel of Florida—this 26-mile stretch of beach is called 30A, Seaside. After being featured as a location in the 1998 hit movie “The Truman Show,” this town saw a big jump in tourism.
With its pastel-colored homes, exquisitely preserved coastal architecture, enviable beaches, top-tier shopping scenes, and world-class dining, this panhandle area is a vacation destination for buyers and visitors alike.
Keep in mind that Seaside’s real estate happens to have the highest price (per square ft.) for 2021 of all the 30A communities, but that doesn’t seem to stop home sales for real estate investing and visitors from flocking here.
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Some have called Temecula a secret paradise for tourists, and it’s easy to see why. Ideally located less than two hours from San Diego or Los Angeles, Temecula welcomes 3+ million visitors and continued vibrant rental demand.
Home value appreciation in Temecula has been reported as high as 29.2%, with a competitive median sale price of $685,000. Vacation rentals are already available in surrounding areas, many featuring luxurious pools, putting greens, and outdoor kitchens.
Wine tasting can be found throughout Temecula, with 50 full-service boutiques and vineyards in the region. An Old Town shopping district has a quaint yet vibrant selection of shops and dining. Bike trails are a-plenty, along with unique western attractions, including the Temecula Stampede—the biggest country music venue on the West Coast.
Austin, Texas
The capital of Texas is considered one of the top US markets for real estate year-round. With a higher net migration than all other American cities, Austin, Texas, has home values appreciating at 3.5% per month and as much as 9% rental returns.
Furthermore, different properties do well here (financially speaking)—from cottages to condos to East Side bungalows. There is plenty of shopping, fine dining, pools, and patios for all your entertaining needs.
A sun-worshiper’s delight, this urban Texas jewel has an average of 300 days of sunshine, which homeowners can enjoy along the banks of the Colorado River or one of their glittering lakes. A spectacular velvet crown sunset can light your goodnights in the best way.
Bryson City, North Carolina
With a soothing mix of mountain views and small-town charm, Bryson City is a place that hasn’t been on the vacationer’s radar for far too long. Quieter than the hotspots you find in neighboring Tennessee, this North Carolina town is a gateway to the natural beauty of the Great Smoky Mountains National Park and the Appalachian Trail.
Despite having only 1,300 residents, Bryson has a thriving arts community with a pedestrian-friendly layout downtown that features galleries, bookstores, and craft brewing. Cutting a gentle swath through town is the Tuckasegee River, a favorite for kayaking, paddleboarding, or fly fishing.
Average home prices for Bryson City are around $195,000—an ideal consideration for vacation rental properties. In addition, smaller cabins are popular throughout the area, giving homebuyers options for short-term rentals or their getaway spot.
Gulf Shores, Alabama
Beyond having almost every water sport available, this Alabama treasure has some famous bars and restaurants for unforgettable nightlife adventures. Attractions are available for the entire family alongside white-sand beaches of the Gulf of Mexico that you’ll likely remember for the rest of your life.
The famous Hangout Restaurant has helped spawn the Hangout Festival, which brings waves of visitors for a yearly three-day music fest. Afterward, why not pop over to Lulu’s, another of the great hot spots of Gulf Shores featuring events, live music, boating, and other attractions.
Real estate investors with an eye on value can find homes in the $400,000 range with a competitive cap rate of 7.1%.
Bend, Oregon
Located three hours south of Portland, Bend has one of Oregon’s highest average sunny days. It also happens to be one of the top markets in America for prospective vacation homeowners.
Formerly named Farewell Bend, this is a haven for outdoor enthusiasts looking for adventure. There are over 300 miles of biking trails and climbing routes, plus plenty of skiing and snowboarding trails to entice you. And thanks to the Deschutes River, you also have hours of water sports available for the wet and wild folks.
After you’ve exhausted yourself with outdoor fun, you can take advantage of more than 15 fine wineries and craft breweries to keep you dancing all night long.
However, this is not a real estate market where you can be idle—most homes have only an average of eight short days on the market.
Windham, New York
Known in real estate markets as the “Gem of the Catskills,” Windham has unparalleled outdoor and indoor recreation. Fine dining restaurants, wine bars, and art galleries are just a few attractions of this gem.
Explore the charm and vibrancy of New York state without the congestion of New York City. Golf courses abound. Ski properties are also frequently available in the mountains for winter enthusiasts.
Median list prices are under $500,000, which is competitive compared to other upstate locations like the Hamptons (a median home price of $1.2 million). Regardless of its price competitiveness, Windham still has a cap rate of 7.1%, sitting in a sweet spot of affordable getaway and investment properties.
Best places to buy a vacation home
Buying a vacation home or any new home can be an exciting prospect. But, whether you are looking for a vacation rental property for some enriching rental income or a permanent vacation destination for yourself and your family—you need to start with the right mortgage company.
Homefinity can help finance a homebuyer’s dreams and get you the keys to your new second home away from home.
Contact us today to get a snapshot of your current and future options. Then, we can walk you through the process of buying a second home and the significant differences between a vacation home and a vacation rental investment property.
Photo by Nextvoyage
