Best places to buy a beach house 2022

Published March 2022

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According to a recent report from Redfin, buyer demand for second homes was up 87% at the start of 2022 from pre-pandemic levels, and while other areas of the real estate market may begin to normalize, second home sales are expected to remain steady.

Each year, we publish multiple reports on the Best Places to Buy a Vacation Home. Our top 25 list takes a look at the top destinations to purchase a vacation rental property, while others focus on more specific types of homes—namely beach or lake houses and winter vacation homes.

This year’s Best Places to Buy a Beach House report takes a look at the top waterfront vacation rental destinations where purchasing a second home has the sunniest outlook. It ranks destinations by cap rate, or yearly rate of return on investment, using both Vacasa’s proprietary and market data. As second home sales continue to soar, our report can serve as a handy guide to some of the best beach markets to purchase a second home.

The 10 best places to buy a beach house in 2022, ranked

Market

Cap rate

Median home sale price

Average annual gross rental revenue

1

Gulf Shores, AL

10.2%

$402,905

$56,198

2

Corolla, NC

9.5%

$608,953

$77,971

3

Navarre Beach, FL

6.6%

$382,392

$43,202

4

New Buffalo, MI

6.6%

$569,873

$58,544

5

Daytona Beach, FL

6.5%

$247,960

$31,913

6

Galveston, TX

6.4%

$340,559

$43,981

7

Hatteras Island, NC

6.4%

$482,447

$45,968

8

Rockaway Beach, OR

6.1%

$384,152

$48,030

9

Port St. Joe, FL

6.1%

$360,721

$39,688

10

Lahaina, HI

5.8%

$725,000

$58,496

1. Gulf Shores, Alabama

Boasting over 32 miles of sandy white beaches, Gulf Shores is a mecca of pure paradise on the Alabama coastline. However, this family-friendly destination is more than just life at the beach with award-winning restaurants, championship golf, amusement parks, and water sports to entertain guests year round. Taking the #1 spot on our Best Places to Buy a Beach House 2022 list, a Gulf Shores vacation home or condo will cost around $400,000, but can yield a cap rate over 10%. How’s that for Southern hospitality?

Cap rate

10.2%

Median home sale price

$402,905

Median annual gross rental revenue

$56,198

2. Corolla, North Carolina

The popularity of the Outer Banks may have grown given its national exposure on a hit reality show, but those who have been traveling there for years have always admired the area’s subtle charm and wide open spaces. With minimal development, but access to high-end dining, shopping, and entertainment, it’s an ever-popular choice for those seeking a rejuvenating getaway. Splash in the salty ocean waves, grab a kayak and hit the sound waters, or explore the maritime forests. And with activity options like that, the fact that a vacation rental property in Corolla could net you approximately $77,000 in median annual gross rental revenue only shores up the investment.

Cap rate

9.5%

Median home sale price

$608,953

Median annual gross rental revenue

$77,971

3. Navarre Beach, Florida

Located just east of Pensacola lies a quaint beach community with big guest appeal. Here, relaxation is the name of the game, and visitors can mostly be found sunning and swimming in the area’s emerald waters. In fact, according to Visit Florida, guests crossing the Navarre Beach Bridge often describe it as “a transcendence into paradise” due to the town’s zen-like state. If you’re able to scoop up a spot on the sand in Navarre Beach, the median home sale price sits under $400,000, and boasts a 6.6% cap rate to boot.

Cap rate

6.6%

Median home sale price

$382,392

Median annual gross rental revenue

$43,202

4. New Buffalo, Michigan

The Gateway of Michigan may not immediately strike your fancy as a Best Place to Buy a Beach House, but take a closer look, and you’ll find the beach-like lakeshore rivals any destination on our list. A small lighthouse anchors the city, which lies just one hour from Chicago and is ideal for a quick trip to kick back. New Buffalo is home to a charming downtown district flanked with restaurants and breweries, as well as a casino and active marina. Holding steady at a 6.6% cap rate, the median annual gross rental revenue in this midwest escape is just over $58,000.

Cap rate

6.6%

Median home sale price

$569,873

Median annual gross rental revenue

$58,544

5. Daytona Beach, Florida

Naturally, when Daytona Beach comes to mind, so do crowds of NASCAR fans that flock to the international speedway each year. But for the subset of guests who prefer a bit more peace and quiet, a stretch of white sand and warm ocean waters awaits—among a plethora of vacation activities Daytona Beach has to offer. From scuba diving to golfing, to shopping and spas, to birdwatching and hiking, Daytona Beach has it all. For many, the median home sale price of just under $250,000 offers a more affordable way to own a piece of the Sunshine State.

Cap rate

6.5%

Median home sale price

$247,960

Median annual gross rental revenue

$31,913

6. Galveston, Texas

While really any of our Best Places to Buy a Beach House are considered year-round destinations, Galveston’s weather, in particular, is so mild that every day can be a beach day. From your towel, you can take in the Victorian architecture that makes the area unique, or pop over to one of the city's top attractions, including the Moody Garden or Schlitterbahn Waterpark. Everything is bigger in Texas, except perhaps the median home sale price, which lands at around $340,000.

Cap rate

6.4%

Median home sale price

$340,559

Median annual gross rental revenue

$43,981

7. Hatteras Island, North Carolina

Another North Carolina market that was (beach) bound to make our Best Places to Buy a Beach House 2022 list is the sunny coastal town of Hatteras Island, which consists of seven villages, two lighthouses, and one National Seashore. The area draws guests to a simpler time, before the world became familiar with the Outer Banks, and offers a more rugged place to relax, ride horses on the sand, or even climb a lighthouse for the perfect sunset shot. If searching on Hatteras Island, one of the area’s homes (stilts optional) will run around $480,000.

Cap rate

6.4%

Median home sale price

$482,447

Median annual gross rental revenue

$45,968

8. Rockaway Beach, Oregon

The Oregon Coast isn’t exactly known for some of the sunny activities that other Best Places to Buy a Beach House are, but that’s what makes the Pacific Northwest an ideal destination for those who prefer seashore with a cooler climate. Instead of sunning on the warm sand, guests along Oregon’s coastline can find themselves storm-watching from the comfort of their vacation home, perusing the local shops, or grabbing a beer at one of the area’s popular breweries, dog in tow. Median annual gross rental revenue, though, is on par with other best coastal towns to invest in, at $48,030.

Cap rate

6.1%

Median home sale price

$384,152

Median annual gross rental revenue

$48,030

9. Port St. Joe, Florida

When considering buying a beach house, buyers looking for a healthy cap rate and postcard-inspiring views can look no further than Port St. Joe. Dubbed the “small town with a big heart,” Port St. Joe is the perfect place for guests to take a relaxing respite. Cruise America’s Scenic Highways and Byways, climb the Cape San Blas Lighthouse, or visit one of the town’s many rustic seafood shacks for over-the-top delicious fare. A place to call your own in Port St. Joe will run approximately $360,000, with a 6.1% cap rate.

Cap rate

6.1%

Median home sale price

$360,721

Median annual gross rental revenue

$39,688

10. Lahaina, Hawaii

The “land of relentless sun” rounds out our Best Places to Buy a Beach House 2022 report, taking the #10 spot. Located on the island of Maui, Lahaina is one of the area’s most popular escapes for swimming and snorkeling in the warm Pacific waters, indulging in a traditional luau, or simply taking in the sunset from your vacation rental lanai. There will be no shortage of guests flocking to Lahaina, which is good news, as homes and condos can skew a bit higher at a median home sale price of $725,000.

Cap rate

5.8%

Median home sale price

$725,000

Median annual gross rental revenue

$58,496

Our methodology

To determine its ranking of top vacation rental markets, Vacasa analyzed home sales and vacation rental performance data from the last 12 months for vacation destinations throughout the country where Vacasa and its licensed subsidiaries manage vacation rentals.* To determine average gross rental income (homeowner revenue made from bookings, excluding any fees) for a market, we used actual performance data for the market as a whole, where available, except that Vacasa-only data was used for markets where Vacasa manages more than 50 units and actual Vacasa rental performance beats the market average by at least 25%. To calculate average cap rate, we considered the averages of the following in each market: property taxes, utilities, HOA fees, insurance, and property management fees.

Local regulations vary by jurisdiction and the transfer of a property to a new owner may affect its ability to be used as a vacation rental. Generally, all vacation rental regulations are subject to change, which may affect your ability to use a property as a vacation rental in the future. Buyers should always check current local regulations prior to making an investment decision.

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Vacasa offers property management and other real estate services directly through Vacasa LLC and through Vacasa LLC's licensed subsidiaries. Click here for more information about Vacasa's licensed real estate brokerage/property manager in your state. Vacasa’s licensed real estate brokerages/property managers include: Vacasa Alabama LLC; Vacasa Arizona LLC; Vacasa Colorado LLC (Micah Victory); Vacasa Delaware LLC, 302-541-8999; Vacasa Florida LLC; Vacasa Louisiana LLC, Dana MacCord, Principal Broker, ph 504.252.0155 (Licensed in LA); Vacasa Michigan LLC, 947-800-5979; Vacasa Missouri LLC, Susan Scanlon, Designated Broker; Vacasa Nevada LLC; Vacasa New Hampshire LLC,45 NH-25, Meredith, NH 03253, Dave Grant, Broker of Record; Vacasa New Mexico LLC, 503-345-9399; Vacasa New York LLC, 888-433-0068, Susan E. Scanlon, Real Estate Broker; Vacasa North Carolina LLC; Vacasa Pennsylvania LLC; Vacasa Real Estate Corporation, California DRE #02105811, Joseph Czapkowicz, California DRE #01380722; Vacation Palm Springs Real Estate, Inc., California DRE #01523013, Mark Graham, California DRE #00700720; Vacasa Real Estate LLC (licensed in Colorado, Daned Kirkham); Vacasa Real Estate LLC (licensed in Idaho, Oregon, and Utah); Vacasa Real Estate LLC (licensed in Maine, Michael McNaboe, Designated Broker); Vacasa Real Estate LLC (licensed in Texas, Debra Brock, Designated Broker); Vacasa Real Estate LLC (licensed in Washington, Robert Brush, Designated Broker); Vacasa Seasonals Inc., California DRE #02160171, Lisa Renee Stevens, California DRE #01485234; Vacasa South Carolina LLC; Vacasa South Dakota LLC; Vacasa Tennessee LLC; Vacasa Vacation Rentals of Hawaii LLC, 3350 Lower Honoapiilani Road, Suite 600, Lahaina, HI 96761; Vacasa Vacation Rentals of Montana LLC, Terah M Young, Licensed Property Manager; Vacasa Virginia LLC; Vacasa Wisconsin LLC; Vacasa Wyoming LLC. In Canada, this advertisement is provided by Vacasa Canada ULC, CPBC lic. number 75826, 172 Asher Rd. V1X 3H6 Kelowna, BC.

*This document is for information and illustrative purposes only. It is not intended to provide “investment advice” or a “recommendation” regarding a course of action. The discussion is general in nature and has not taken into account your personal financial position or objectives. You should consult a licensed financial advisor or other professional to discuss your specific situation.

Estimated rental income figures and home sale prices are based on historical averages; for any specific property, the actual revenue, purchase price, and cap rate may differ materially from estimated amounts and depend on a wide range of factors outside Vacasa's knowledge or control, such as the property's condition, layout, and furnishings; expenses associated with the acquisition and ownership of the property (such as property taxes, utility fees, HOA fees, insurance fees, and mortgage-related expenses); rental calendar availability; existing and future regulations; current and future economic, social, and political trends and conditions; and weather and environmental factors. These estimates do not take into account the potential impact of state income taxes.

Many locations restrict or impose conditions on the use of properties as vacation rentals, or restrict vacation rentals to certain defined areas. Before purchasing a particular property as a potential vacation rental a buyer should confirm that the property can legally be used for this purpose.

Vacasa makes no representations or warranties, express or implied, about the accuracy of this document. Furthermore, Vacasa has no obligation to update, modify or amend this document or to otherwise notify users in the event that any opinion, assumption, forecast or estimate set forth herein changes or subsequently becomes inaccurate. Therefore, you should not place undue reliance on statements in this document.