While we love booking beach vacation homes, paying steep every day rates is not exactly fun. But in the event you are lucky enough to own such a spot, renting it for a brief period can generate significant income.
in recent testAirDNA, an Airbnb data analytics company, has found US vacation rental markets where owners are more likely to see the very best annual returns. Researchers divided the cottage, city apartment, and beach house markets, after which based the outcomes on occupancy and average every day rates based on data from April 2022 to March 2023. Potential annual gross income was calculated by subtracting Airbnb fees from expected fees for rent (although mortgage payment and other expenses weren’t included within the calculation).
City rents had the bottom potential income of the three housing types. The cottages showed more potential. Large beach houses appeared at the highest. It’s true that purchasing in expensive markets is pricey – just like the top-ranked Santa Barbara, California, where an occupancy rate of 66 percent and a mean every day rate of $1,224 generated a possible annual gross income of $261,115. Los Angeles and Miami followed with similar revenue potential. In fact, 17 of the 20 most profitable short-term beach house rental markets were in California or Florida. To determine the profitability of beach houses, only the coastal areas of the customarily larger markets were considered.
New York’s Long Island (considered a person market within the study) ranked twentieth in beachfront homes, little doubt due to luxury rentals within the Hamptons and elsewhere within the East End. Long Island’s occupancy rate skyrocketed from 43 percent in 2019 to 52 percent in 2020, and has hovered around that level ever since. The average every day rate has increased significantly, from $796 in 2019 to $1,447 in 2023.
Holiday areas on each coasts have shown a rise in demand this 12 months, which is encouraging for those lucky enough to own properties. But recent owners needs to be warned: the increased risk of severe weather and rising sea levels threatens to cut back these incomes within the short term.
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