Buying a property can prove to be a fruitful investment. It can also be a great source of extra income.
In October, Evolve, a vacation rental company, released its ranking of the best places to buy a vacation house right now.
The company used a combination of proprietary and public data and three key metrics to determine the best places to buy a vacation house right now:
- Vacation rental performance metrics for vacation destinations around the U.S. to learn where bookings lead to higher median revenue
- A combination of Zillow, Redfin and internal data to identify median listing prices in vacation destinations
- Estimated yearly expenses to run a vacation rental (approximately 30% of total revenue) to help calculate the cap rate
No. 1 best place to buy a vacation house right now: Finger Lakes, New York
Median rental revenue: $31,434
Median listing price: $202,257
Example cap rate: 10.9%
Located in upstate New York, just south of Lake Ontario, Finger Lakes is the No. 1 place to buy a vacation house right now, according to Evolve.
The report states that properties with easy water access tend to do well in the region. Some owners earn more than double the median annual revenue with additional perks like kid-friendly amenities and furnished decks or patios.
The Finger Lakes region is home to an expansive wine country that is often compared to Napa Valley, according to U.S. News and World Report. It has over 400 wineries and vineyards and is the largest wine-producing region in the state.
According to data from HomeToGo, the median nightly price of house rental in Finger Lakes is $592 for larger homes while the average price of a cabin is $517 per night.
10 best places to buy a vacation house right now
- Finger Lakes, New York
- Holland, Michigan
- Hocking Hills, Ohio
- Palo Pinto, Texas
- Wisconsin Dells, Wisconsin
- Savannah, Georgia
- Michigan City, Indiana
- Vernon Township, New Jersey
- Dover, Vermont
- Sevierville, Tennessee
Holland, Michigan is the No. 2 best place to buy a vacation house right now.
The Evolve report states that the median rental revenue for Holland is $44,577, the example cap rate is 8.8% and the median listing price is $355,544.
Located near Lake Michigan, top-performing vacation rentals in Holland are kid-friendly, tend to have three bedrooms and boast waterfront views.
These types of properties have been known to bring in more than $83,000 annually for some Evolve owners — more than twice the market's median revenue, according to the report.
The area is famous for its annual Tulip Time Festival, celebrating Holland's vibrant tulip fields and Dutch heritage.
The local Holland State Park is known for its sugar-sand beach and views of the famous Holland Harbor Light, also known as the Big Red Lighthouse.
Rounding out the top three is Hocking Hills, Ohio.
Located in Southeast Ohio, Hocking Hills is mainly known for its massive caves, stunning waterfalls, and towering cliffs.
The median rental revenue is $42,751, the example cap rate is 8.6% and the median listing price is $349,260, according to the Evolve report.
Cabins are the most popular homes in the area and can be booked for as low as $104 a night, according to HomeToGo. The cost for a cabin rental in Hocking Hills is usually around $328.
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