So you’re thinking about investing in a vacation rental property. Smart move. The vacation rental market is hot and only getting hotter. People are traveling more than ever and turning to rentals over hotels. The potential to earn a healthy profit while also enjoying some vacation time of your own is huge. But where to start? There are so many options, how do you choose? As a beginner, you want a location that will attract plenty of interest from renters without too much hassle or risk. You want a place you'll enjoy visiting too, of course. In this guide, we've scouted the top vacation rental spots for beginners in 2023. The locations we've chosen offer strong demand, high rental potential, and relative stability. We’ve also included tips for finding and financing the right property, marketing it, and managing it to maximize your returns. By the end of this guide, you’ll have the knowledge to become a vacation rental pro in no time. Ready to get started? Let’s go!
Top Vacation Rental Locations in the U.S. For 2023
If you're looking to invest in a vacation rental property, 2023 is shaping up to be an excellent year. Some of the top locations in the U.S. are poised to bring strong returns.
The Florida Keys, with its tropical vibe and proximity to Key West's attractions, remains a premier destination. Rentals do well year-round but peak in winter. The natural beauty and outdoor activities attract nature lovers and families alike.
Just north, Orlando and nearby theme park areas continue to draw huge crowds. Turning your property into a vacation rental here means essentially guaranteed occupancy and premium rates, especially if located within 10-15 minutes of Disney World or Universal Studios.
Out west, Colorado mountain towns like Breckenridge, Vail and Aspen offer stunning scenery and world-class skiing in winter with hiking and biking in summer. Rentals typically rent at a premium during peak snow season from December through March.
In California, Palm Springs remains an ideal retreat with its resort atmosphere, golfing, and proximity to Joshua Tree National Park. Mid-century modern homes are especially popular with design-savvy travelers.
The Pacific Northwest, from Seattle down to Portland, attracts outdoor enthusiasts and foodies. Rentals located on the coast or near national parks like Olympic or Mt. Rainier can demand higher rates, especially in summer.
Any of these locations would make an excellent investment for 2023. Do your research to determine the specific area and property type that matches your budget and goals. With the right place and some smart marketing, you'll be on your way to running a profitable vacation rental business in no time!
How to Find and Purchase an Investment Property
Finding the right investment property for your vacation rental business takes time and research. Where should you start?
Focus on popular tourist destinations. Places like beach towns, mountain resorts, theme park areas and big cities are always good options. Do some searching on Airbnb, VRBO and TripAdvisor to see which locations get the most interest from travelers.
Check real estate listing sites for potential properties. Sites like Zillow, Trulia and Realtor.com allow you to filter by location, price, number of rooms and amenities. Look for places with 3-5 bedrooms, lots of extras like a pool or hot tub and in a desirable neighborhood.
Visit the top candidates in person. There’s no substitute for seeing the property and area with your own eyes. Make sure the home is in good condition, has nice decor and any needed repairs or updates will still allow you to make a profit after accounting for costs. Talk to others in the local vacation rental community to learn more about the location.
Negotiate the best deal. Work with the seller to determine a fair price based on the property features, recent comparable sales and income potential. You want to buy at a good value so you have more opportunity for higher returns on your investment.
Be prepared to act quickly. Desirable investment properties often sell fast, so have your financing ready and be prepared to make a solid offer right away if you find a great place that checks all the boxes! Following these steps will help you find and purchase a vacation rental property primed to generate profits for years to come. Success is closer than you think!
Setting Up Your Vacation Rental Business for Success
Choosing a Property Management Company
Once you’ve found the perfect vacation rental property, you’ll need to determine how to manage it. For many owners, hiring a property management company is the best option, especially if you don’t live nearby. A good company can handle tasks like:
Advertising your rental and booking guests
Greeting guests when they arrive and providing check-in/check-out services
Handling maintenance, repairs and cleaning between guests
Managing payments and accounting to ensure you get paid on time
Look for an established company with experience managing vacation rentals. Check online reviews from their current owners and guests. Meet with a few candidates to discuss their fees and the specific services they provide. You’ll want a company that can professionally market your rental, keep it in great shape and deal with any issues that arise so you can relax and collect the profits.
Setting Competitive Rates
Work with your property manager to determine rates that will attract guests while still being profitable. Check rates for comparable rentals in your area to determine a competitive price range based on factors like:
Size and amenities of your rental
Time of year (high season vs. low season)
Location and desirability
Type of rental (house, condo, cabin, etc.)
You may be able to charge a premium if your rental is particularly luxurious, in a prime spot or includes lots of extras. But in general, you'll want to price similarly to other rentals to maximize bookings, especially when you're first getting started.
Marketing Your Vacation Rental
With the help of your property management company, focus on marketing your rental on popular vacation rental sites and booking platforms to reach potential guests. High-quality photos and an enticing listing highlighting the amenities and experience you offer will draw more interest. You should also spread the word on social media using eye-catching images and posts to build buzz.
Positive reviews from your first guests can significantly impact future bookings. Ask happy guests to leave reviews on the sites they booked through, as well as your social media profiles. Provide a small discount or perk for the favor in exchange.
Conclusion
You now have the basics to get started with your own profitable vacation rental business. The opportunities are endless if you do your research, invest in the right locations, and provide a five-star experience for your guests. While the initial costs and work involved may seem daunting, the rewards of residual income and owning a successful rental business can be life-changing. Follow the tips in this guide, start small if needed, build up your properties over time, and soon you'll be living the dream - making money from your very own vacation kingdom and helping others experience memorable getaways. The vacation rental world is your oyster, so take that first step and start reaping the benefits of this exciting industry. You've got this!
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