4 Tips to Choose a Vacation Rental Market

Traveling is truly a great way to de-stress, unwind, and escape the hustle and bustle of daily life. But it’s also a well-known fact that it can be expensive, especially if you didn’t plan it right. Accommodation alone can take up a huge chunk of your budget, so much so when you’re traveling for a few weeks. Thanks to short-term vacation rentals, travelers can cut down on their expenses by a lot, while enjoying some benefits that hotels couldn’t offer.

For property investors, vacation rentals also offer a huge opportunity to make good money as well. The possibilities of earning high returns on investments (ROIs) are endless, especially when you put your money on the right properties.

Check out the best places to buy vacation rental property, and how to find a good investment:

1. Cities with Favorable Regulations
Although vacation rentals are highly beneficial for investors, not all cities accept them as a legal type of accommodation. Some tourism regulatory boards can be strict in implementing their policies, which pose a challenge to both property owners and travelers.

One of the biggest reasons for this is the industry’s impact on existing businesses. A lot of regulators would argue that allowing vacation rentals in their cities would affect the business of hotels, hostels, and other typical accommodation options that are already present for many years.

Travelers would also flock to private residential communities and invade the privacy of residents. This is why if you want to find the best places to buy vacation rental property, you should first look into a city’s regulation on such properties.In the US, New York, San Francisco, and Santa Monica are some of the cities with the strictest rules for vacation rentals.

While New York may be one of the biggest tourist destinations in the world, it also has some of the strictest laws regarding short-term rentals. In 2011, the New York State Multiple Dwelling Law made it illegal for an apartment to be rented out for less than 30 days without the permanent tenant living in the building at the same time. Advertising a rental was even illegal and was subject to fines of up to $7,500. In 2018, the New York City Council also introduced a bill that requires hosts to disclose details about listings, their identities, and addresses each month.

So, if you want convenience and hassle-free transactions, you should know how to buy a rental property and opt for places with more favorable regulations. Some of the best cities for short-term rentals are Big Bear Lake in California, Savannah in Georgia, Louisville in Kentucky, and San Diego in California.

2. Places That Are Highly Dependent on Tourism

A lot of cities in the US depend highly on tourism as a major source of income, and you can expect 

these places to be more open to different types of accommodation options, including short-term 

vacation rentals.

Tourism-dependent cities and regions include New Orleans, the Outer Banks, the Great Smoky 

Mountains, and Big Bear Lake. Tourism is also a key economic driver for states like Texas 

(earned $164 billion in 2018 from tourism), California, Nevada, New Jersey, New York, and Florida.

When looking for the best places to buy vacation rental property, it is always a good option to 

search in these locations, as they ensure a high ROI year after year.

3. Areas Where Short-Term Rentals for Overnight Stays 

Are a Norm

Vacation rentals are not for every city; that’s for sure. But in some areas, renting a beach 

house or an apartment has been popular even before short-term rental websites, like Airbnb, came 

to being.

Since these cities are used to having a huge influx of tourists renting holiday apartments and 

houses within their communities, you’ll have no problem with regulations over renting out 

properties. Also, your guests will easily feel right at home knowing that locals are used to having 

visitors in the neighborhood.

You don’t always have to choose the bigger cities to invest in a rental property. You’ll surely find 

good options in off-the-beaten-path destinations, and they could be surprisingly beautiful. 

And, since these places thrive on tourism, they are also more welcoming to visitors, which is a 

huge advantage for investors like you.


4. Properties That Are Near Proven Attractions

It’s a no-brainer that if you’re going to visit a place with proven attractions, like beach towns, ski 

resorts, and national parks, you’ll most likely find several vacation rentals in the area. This means 

that you will always have a piece of the pie when you buy a property in the area too.

It is best to arm yourself with knowledge on how to buy a rental property for a particular location. 

So, check if the place has tourist spots that attract a high number of tourists every year. A good 

example of such a place is the Florida Keys, where people from all over the world flock to experience 

exciting water activities and a beach life you’ll not experience anywhere else in the world.


Make the Best Decision in Choosing a Rental Investment Market!

You should evaluate the neighborhood where you’d like to buy a vacation rental. Read reviews to 

get an insight into what other property owners think about the area to make sure that it is what you’re 

looking for.

Don’t be afraid to negotiate for the price. A lot of owners and developers are willing to offer 

favorable deals on their properties.

However, always remember that learning how to find investment properties involves visiting the 

places personally and get a feel of how it’s like to live in them. Living like a tourist yourself—just 

soaking in the beauty of your surroundings and enjoying a stress-free time with your loved ones—

gives you a complete understanding of how you can provide a quality experience to your future guests.

Of course, you should also work with real property experts who can give you valuable insights and guide you through the plethora of options in today’s short-term rental property market. It is always good to have professionals by your side, especially when you are new to this trade.