The vacation rental business has gotten tougher in recent years. Cities are tightening short-term rental restrictions and housing prices are rising around the country. Yet there's still money to be made investing in vacation rentals.
That's especially true in the wake of the coronavirus pandemic as families are eager to travel but not quite ready to jet-set abroad. Experts predict high demand for domestic travel in 2021, particularly to rural, coastal, and outdoorsy locales.
If you’re ready to break into real estate investing, these tips will help you make a strong entry into the vacation rental business in 2021.
2021 Vacation Rental Industry Trends
The coronavirus pandemic turned the travel industry upside down and vacation rentals were no exception. As the industry bounces back, it looks a bit different than in 2019.
● Locations that let travelers spread out will come out ahead of urban destinations in 2021. The Poconos, Hot Springs, Arkansas, Cape Coral, Florida, and Pigeon Forge, Tennessee rank among the top places to invest.
● Small towns don't necessarily come with small prices, however. Home prices in small towns are rising, too. Luckily, that represents an opportunity for real estate investors.
● Americans crave meaningful travel in 2021, Millionacres explains. That means longer stays, larger spaces, and a willingness to pay more for home-like amenities and curated local experiences.
● Investors will need strong credit and hefty down payments to secure a rental property mortgage this year. However, those who qualify benefit from low-interest rates.|
How to Maximize Vacation Rental Income
Now you understand where the market is headed, but how can investors capitalize on today's vacation rental opportunities? Here's how to invest profitably in the vacation rental market.
● Like all real estate investments, vacation rental profitability is all about location. However, travelers want more than a great destination. Spacious layouts, high-tech connectivity, and a focus on cleanliness and safety will be paramount for travelers.
● Be wary of overpaying for a vacation rental. It doesn't matter how great a property looks if you can't rent it for a profit. Hire