According to a recent Redfin report, buyer demand for secondary homes will increase by 87% in early 2022 compared to pre-pandemic levels. And what’s more romantic than a second home on the waterfront? While other areas of the real estate market begin to normalize, secondary home sales should remain consistently strong. Let’s consider the most optimal places for buying real estate that can be rented out to vacationers. Use market data and information from Ewa Beach, HI real estate agents to rank destinations by annual return on real estate investment. As home sales continue to rise, the information will be a useful guide to buying homes in the best beach real estate markets.
Ten best places to Buy a beach house in 2023
1. Gulf Shores, Alabama
With more than 32 miles of white sand beaches, Gulf Shores is a true paradise on the Alabama coast. This family-friendly destination offers more than just beach life. You can play golf, go to numerous restaurants, take a walk in a theme park, and do water sports. A vacation home in Gulf Shores will cost around $400,000, but the markup can be over 10%.
2. Corolla, North Carolina
The Outer Banks may have grown in popularity thanks to the popular TV show, but those who have traveled there over the years appreciate the area’s elegant charm and many attractions. Dive into the salty waves of the ocean, take a kayak, dive into the ocean of sounds, and explore the marine jungle. A rental property in Corolla can generate an average annual gross rental income of approximately $77,000, which only reinforces the investment in an active area of the local real estate market.
3. Navarre Beach, Florida
The picturesque coastal community east of Pensacola attracts many visitors. Most vacationers spend their days sunbathing and swimming in the area’s emerald waters. Visitors who cross the Navarre Beach Bridge often describe it as a “gateway to heaven.” The average sale price of a home is less than $400,000 and rising rapidly, so investing here is the most profitable for many investors.
4. New Buffalo, Michigan
This location might not immediately come to mind as the best place to buy a beach house, but take a closer look and you’ll see that the lakefront rivals any destination on your list. Just an hour away from Chicago, New Buffalo is a mainstay in the city and perfect for a short vacation trip. New Buffalo has a charming downtown with restaurants, breweries, casinos, and a bustling harbor. The median annual gross income for rental properties in New Buffalo is over $58,000.
5. Daytona Beach, Florida
Of course, Daytona Beach comes to mind for NASCAR fans who flock to International Speedway every year. Here are beaches with white sand and warm water, they await those looking for a peaceful vacation. From snorkeling and golfing to shopping, spas, bird watching, and hiking, Daytona Beach has it all. With an average home sale price of approximately $250,000, it offers a less expensive way to own your beachfront property.
6. Galveston, Texas
Each of the best places to buy a summer home is considered a year-round destination, but especially in Galveston, the weather is so mild that every day can be a beach day. Relax in one of the main attractions of the city, and enjoy a quiet, peaceful beach vacation.
7. Hatteras Island, North Carolina
Hatteras Island is on the list of the best places to buy a beach house in 2023. Here you can relax, lie on the warm sand or climb the lighthouse at sunset. This area attracts visitors with its calm, relaxed atmosphere. The average home costs approximately $480,000.
8. Rockaway Beach, Oregon
Known for its sunny vacations, the Oregon Coast is a great place to buy a vacation home for those who prefer a seaside climate. You can watch storms, browse the local shops, or visit one of the Oregon Coast’s favorite breweries. The average annual gross rental income is $48,030, which is in line with that of any other major beach town that is good for investment.
9. Port St. Joe, Florida
Buyers considering buying real estate here are well aware that Port St. Joe is known as a “small town with a big heart” and is the perfect place for a relaxing vacation. Travel America’s scenic highways and byways, admire the Cape San Blas Lighthouse, and visit one of the many fishmongers for a delicious meal. The average home here costs around $360,000.
10. Lahaina, Hawaii
The Land of Relentless Sunshine closes out the list of best places to buy a beach house in 2023, one of the most popular vacation spots for swimming and outdoor activities in the warm waters of the Pacific Ocean. When you check with real estate agents in Hawaii, you’ll find that single-family homes and condos, with an average sales price of $725,000.
When purchasing a beach house, it is important to thoroughly review the documentation of the developer and ensure that they are legally authorized to carry out construction activities. Additionally, it is essential to verify that the property meets all legal standards and requirements before completing the purchase. This process typically involves a detailed assessment of the project application, which contains critical information regarding the property’s technical condition. Finally, it is important to be aware that some property owners may conceal defects in their properties, so it is crucial to carry out inspections in stages and ensure that all key requirements are met before completing the transaction. Overall, buying beach real estate can be a highly valuable investment, but it requires careful consideration and attention to detail to ensure a successful outcome.
Buying beach real estate with a mortgage
Currently, many investors do not have the money to purchase their beach property in cash. The most common option for buying beach real estate is using a mortgage. This allows you to buy real estate without the total capital on hand. However, it should be remembered that only people with a stable income can get a mortgage.
The step-by-step process of buying real estate with a mortgage is quite complicated, it is difficult and risky to do without qualified legal assistance. Different parts of the country have different mortgage rates. A detailed description of the housing mortgage will allow you to choose the most favorable offer. However, even if you get approved for a mortgage, expect to pay a down payment of 10-40% of the total value of the real estate. Rates vary depending on the specifics of the financial institution’s work.
Applying for a mortgage to purchase beachfront real estate can be a complex process. First, it’s important to research and compare mortgage options from various lenders, taking into account interest rates, terms, and fees. The lender will also evaluate the potential buyer’s credit history, income, and debt-to-income ratio to determine eligibility for the mortgage. When applying for a mortgage, the lender will require documentation such as tax returns, bank statements, and proof of income. It’s important to be prepared to provide all necessary documents and to respond quickly to any requests from the lender to ensure a timely approval process. Once the mortgage is approved, the buyer will need to work with a title company or attorney to complete the transfer of ownership and finalize the purchase of the beachfront real estate.