When looking for a beach house, there are a number of criteria and issues to address.
Before searching around to look at vacation rental beach homes, you need to figure out which one best suits your needs and most importantly your budget. Location is another important factor to include and usually beachfront properties with a view of the ocean never grow old and don’t go out of style.
If you’re looking for a vacation rental for short-term use, then you need to calculate your net operating income over your costs, typically known as Total Cap Rate. To do that, you need to determine the gross rental income and minus expenses, such as management fees and property tax.
- Ocean Shores, WA
A small coastal city in Washington State, it’s quite famous for its long Pacific beach and a network of lakes and waterways. It’s one of the top and most popular destinations to buy a beach house as it offers a cap rate of 7.6 percent, average annual revenue of more than $32k, and the median cost of the house is estimated at less than $250k.
- Myrtle Beach, SC
A popular spring-break destination, Myrtle Beach is the best place for all ages. If you’re looking for something energetic, theme-park rides, and wildlife tours this one have you covered. Or if you prefer a quiet, sunny afternoon, you can go golfing on one of the numerous golf courses and have a great time.
If you’re looking to stay at America’s most desirable place, new homes are for sale in Myrtle Beach SC with new constructions going on everywhere to give you a fresh start. The place provides low taxes, low cost of living, affordable housing rates, a friendly neighborhood, warm, sunny beaches, and a large piece of land for new developments. Look for the oceanfront lots or properties that are near the water as they generate more income.
Myrtle Beach has a cap rate of 7.4 percent, its average annual income is also above $32k and the median home cost is around $260k.
- Panama City & Santa Rosa Beach, FL
Crystal-clear turquoise waters and white, sandy beach that stretches for miles, Panama City Beach remains high in the real estate investment list. Due to an increasing number of developments, high-rises have paved their way into the city with fewer historic homes left. With around 30 miles northwest lies Santa Rosa Beach where families looking for a coastal environment and open nature can buy a vacation home.
Panama City Beach and Santa Rosa Beach have a cap rate of 6.1 percent, an average annual income of more than $44k, and the median cost of a home is more or less $420k. Since Florida tends to be a breezy place with warm atmospheres, it is recommended to think about replacement windows.
- Galveston Island & Port Bolivar, TX
People in Galveston are of two types: Born on Island (BOI), and Islander by Choice (IBC). They take huge pride in this but also welcome tourists with open hands. Although there are several hotels available, vacation rentals are more in demand. With median home costs floating around $350k, buyers are encouraged not only to book a rental but also to come and take a look. The vacation rentals look like something out of a magazine with interesting architecture and full of color. The same can be said for Port Bolivar which lies just north across the water.
This place has a cap rate of 5.6 percent and an average annual income of more than $40k.
- Kauai, HI
One of the oldest of the main Hawaiian Islands, Kauai is an island filled with raw and undisturbed nature, with high peaks of mountains, gorgeous valleys, and scenic waterfalls that will take your breath away.
Kauai’s unique cap rate, of approximately 5.4 percent, makes it a dream place to invest in. Most travelers prefer a 2-bedroom condo and the ones near the ocean also portray a vacation rental-friendly. However, if the condo isn’t your type, Princeville has several rental homes available to meet your needs.
The median cost of a home here hovers around $690k and the average annual income is more than $61k.
- Ocean City, MD
As the name suggests, you can expect a lot of sunbathing, swimming, socializing as local shops, restaurants, parks and even the beach are all accessible via walking or cycling along a 3-mile beachfront boardwalk. Ocean City has been listed to have the “best beaches in America” and rightly so, as surfing, canoeing, fishing, kayaking you name it, are all available here.
Oceanfront vacation rentals are the way to go with a median home cost of around $285k, it is encouraged to grab the rentals before they become unavailable. The place has a cap rate of 5.4 percent and an average annual income of more than $30k.
Tips before Purchasing
When you are done selecting the perfect place to buy a vacation rental, the next step is to make sure if you’ve thought it through.
- Purpose: are you going to buy it for personal use or investment purposes? Choosing the best cap rate would be the best option if you are looking to get a return on your investment.
- Oceanview: oceanfront houses yield more income than others, however, you need to keep in mind that not everyone will be able to afford it. If you purchase one without an oceanview, think about including a pool. However, most travelers do prefer ocean scenery when on vacation.
- Find the right real estate agent: if you are planning on buying a vacation rental, find an agent that has good knowledge about the place and can give you the necessary data required for you to make an informed investment.
- Design: once you’ve acquired your rental house, design it the way you would like it to look if you were a guest.
- Marketing: last but not the least, you need to attract tourists and convince them to stay at your rental. For this, you can stage your rental property, put in ads, and make easy income from your investment.
Wherever you intend to buy a vacation rental, make sure you do your homework. Don’t judge the rental via pictures, instead go out there and take a look for yourself. Ask real estate agents for advice and talk to surrounding neighbors to know more about the area. Make your investment count.