The 10 Best Vacation Cities for Investors to Buy Rentals

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  • Realtor.com analyzed rental markets to find where vacation homes were making the most money.
  • A new report lists vacation towns in the United States that investors should target for the best returns.
  • Most of the areas listed are close to national parks, with Joshua Tree in California at the top of the list.
  • See more stories on the Insider business page.

Trying to land a vacation rental this summer has been brutal, unless you’re willing to shell out thousands of dollars. And many Americans, after months inside, were ready to do it.

If you’re looking to get in on the action, real estate resource Realtor.com has just analyzed which markets have been most profitable recently for short-term rentals.

Short-term rental occupancy rates are up 21% this summer from 2019. The pandemic-inspired travel boom is propelling vacation towns to new heights and filling the pockets of savvy real estate investors.

Realtor.com has partnered with real estate data company AirDNA to assess the nation’s 250 largest rental markets and make a list of the most profitable markets based on short-term rental revenue growth from May 2020 to May 2021.

The resulting list, presented in ascending order, features the places with the greatest increase in potential short-term vacation rental income – which will only remain desirable if the travel boom continues. It also includes the median price of a home in the area, as well as the number of days per month that a home should be rented to cover typical mortgage payments, where buyers have a 20% down payment and a down payment rate. 3% mortgage interest.

The best places are all near tourist attractions such as huge national parks – # 1 on the list borders Joshua Tree National Park in California while # 10 borders Hot Springs National Park in Arkansas.


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