The Best Place to Buy a Vacation Home in Every Southern State

Savannah Georgia
Photo: Jordan Banks/Getty Images

Whether or not you have the extra cash to invest in a vacation home, chances are you've dreamt of exactly where yours would be: Perhaps it's a quiet cabin tucked away in the Blue Ridge Mountains, or a beach condo overlooking the piercing aqua seas off Panama City Beach. Second homes are often envisioned as personal paradises, but for those who can afford them, they can also be much more. According to a report by GoBankingRates.com, some cities in particular can yield especially high returns on investment, thanks to factors such as destination popularity and affordability of homes. Interested in trying your luck as an Airbnb Superhost? Here are the best places in your state to start the house hunt.

01 of 18

Properties in These Southern Cities can Yield High Returns on Investment

02 of 18

Alabama: Gulf Shores

Gulf Shores, Alabama
Gregory Kurpiel/EyeEm/Getty Images

Known for its sugar-white sand and crystal-clear Gulf waters, Alabama's liveliest beach town understandably attracts a loyal following of repeat visitors (many of whom make the trek to paradise multiple times a year). From a homeowner's standpoint, this translates to a pretty reliable annual rental income—to the tune of $16,700, on average.

03 of 18

Arkansas: Hot Springs

Hot Springs Arkansas
Daniel Haynes/Getty Images

While it's the city's namesake natural wonders that initially attracted visitors here, Hot Springs has built a reputation as a charming little getaway all on its own. Today, visitors come not just for the mountain escape's healing thermal waters and natural beauty, but also for the food, shops, culture, and family-friendly attractions. Couple the destination's popularity with surprisingly affordable home prices, and second homeowners can expect a rental property to yield more than 10 percent of the home's purchase price annually—one of the highest percentages in the country.

04 of 18

Delaware: Rehoboth Beach

Rehoboth Beach Delaware
Photo by Scott Dunn/Getty Images

In a town that encompasses just one-square-mile, homeowners in Rehoboth Beach can certainly count themselves as members of an exclusive club. But if you can swing the initial investment toward a home purchase, the storybook beach town certainly won't disappoint in terms of income and overall charm.

05 of 18

Florida: Kissimmee

Kissimmee Florida
Education Images/UIG/Getty Images

In a state that perpetually attracts couples, snowbirds, Spring Breakers, families, solo travelers, young, old, and everyone in between for vacations, where do you choose to set down roots for a second home? Have faith in Disney World. Of all the tourist towns in the Sunshine State, Kissimmee—with its affordable home prices and proximity to Mickey Mouse—yields the highest return on investment.

06 of 18

Georgia: Savannah

Savannah Georgia
Jordan Banks/Getty Images

Always fantasized about owning a historic cottage in Georgia's most charming waterfront town? Good news: Your dream could also be a smart financial decision. According to the report, Savannah boasts the third-highest rental return in the country, with reasonably priced real estate available (compared with other popular tourist destinations) and an average annual rental income of $13,700.

07 of 18

Kentucky: Louisville

Louisville Kentucky
Kevin R. Morris/Corbis/VCG/Getty Images

Anyone who owns a rental home near an annual mega-event like the Kentucky Derby can expect to seriously bank at least once a year. But, outside of Churchill Downs, Louisville is an attraction in its own right for those seeking both history and bourbon-filled fun, making year-round returns on a rental property a real possibility. Here, second homeowners can expect to recoup more than 10 percent of their home purchase price annually.

08 of 18

Louisiana: New Orleans

New Orleans Louisiana
John Coletti/Getty Images

As one of the most preeminent cities in the South, New Orleans attracts tourists from all over the globe thanks to a roster of world-class festivals, restaurants, and storied jazz clubs. For investors, that year-round draw makes second homeownership here a no-brainer. According to the report, rental properties in The Big Easy can bring home an average annual income of $16,800.

09 of 18

Maryland: Ocean City

Ocean City Maryland
rypson/Getty Images

The charming sliver of a resort town that makes up Ocean City is packed with family-friendly fun, including an amusement park, boardwalk serving up classic beach treats, and 10 miles of pristine beaches—AKA all the makings of the perfect summer vacation. Every season, Ocean City attracts hordes of tourists looking for a comfy place to stay, which translates to a reliable source of income for anyone lucky enough to own a home here.

10 of 18

Mississippi: Pass Christian

Pass Christian Mississippi
Meinzahn/Getty Images

For residents of Pass Christian, time moves by at a pleasantly slow pace. It's that laid-back way of life that lures visitors to the quaint fishing town, where to-dos consist of nothing but leisurely strolls along the beach, antiques shopping, and settling down for some fresh Gulf coast seafood come happy hour. Those who want to join the club can get in for a reasonable price and expect to earn a good chunk of that back—roughly 9 percent—annually.

11 of 18

Missouri: Osage Beach

Osage Beach Missouri
fozzyb/Getty Images

There isn't a Southerner around who doesn't know the joys of lake house life (and the spectacular sunsets that come along with it). In Missouri, Lake of the Ozarks is perhaps the most popular place to point your GPS come summer, with 1,100 miles of shoreline and plenty of activity both on and off the water. Osage Beach offers variety in terms of real estate pricing, and thanks to its popularity and resort-quality amenities, can bring in an average annual rental income of $14,100 for second homeowners.

12 of 18

North Carolina: Wrightsville Beach

Wrightsville Beach North Carolina
Morgan Wehring / EyeEm/Getty Images

If money isn't a factor in your second home search—meaning: you have a hefty chunk of cash saved up for down payment—skip North Carolina's well-trafficked Outer Banks and head down toward Wrightsville Beach instead. The tiny resort town just east of Wilmington comes with a steep home price (just shy of $1 million) but those who can afford that can count on bringing in, on average, nearly $50,000 in rental income per year.

13 of 18

Oklahoma: Oklahoma City

Oklahoma City
Jeremy Woodhouse/Getty Images

As the largest city in Oklahoma, this urban destination attracts all kinds of renters, from the business travelers to the vacationers looking to explore the area's museums, shops, performing arts venues and more. Couple that with low housing prices, and real estate investors can expect to pay off the full cost of their second homes in about 10 years, according to the report.

14 of 18

South Carolina: Hilton Head

Hilton Head South Carolina
Sean Pavone/Getty Images

Beaches, golf courses, luxury resorts, dreamy wedding venues … in terms of tourist draws, one of South Carolina's most beloved island destinations has it all. For aspiring vacation homeowners looking to capitalize on both personal leisure and income potential, Hilton Head is a good option: Prices here can range from the $300ks to well over $1 million, so there's a good deal of variety for both investors and vacationers.

15 of 18

Tennessee: Nashville

Nashville Tennessee
John Wylie / EyeEm/Getty Images

Whether you come for the live music, the food scene, the lively country bars, or the urban vibe, Nashville offers everything you'd want from a quintessential Southern city. And as the area's growth continues to boom, now might be the perfect time to invest. According to the report, second homeowners in Music City can expect to earn an average annual income of nearly $20k from a rental property.

16 of 18

Texas: South Padre Island

South Padre Island Texas
Jeff R Clow/Getty Images

Everything is bigger in Texas—and on South Padre Island, that includes rental property incomes. Blame it on the barrier island resort town's miles of idyllic beaches, its family-friendly attractions, and its world-class birding and nature center, all of which attract healthy crowds to the Gulf coast town each year. With steady traffic, second homeowners can expect their vacation pads to pay for themselves in 11 years.

17 of 18

Virginia: Virginia Beach

Virginia Beach
DenisTangneyJr/Getty Images

Virginia may be for lovers, but the state's namesake beach town is certainly for smart real estate investors. With draws that include a beach, boardwalk, museums, and a smattering of craft breweries, the city is a natural magnet for fun seekers from Virginia and beyond. And according to the report, capitalizing on that traffic with a rental property could add an extra $19,000 to your income.

18 of 18

West Virginia: Charles Town

Charles Town West Virginia
L. Toshio Kishiyama/Getty Images

Offering a quaint downtown steeped in history with a side of outdoor adventure, tiny Charles Town is beloved for its small town charm and natural beauty. With a footprint that spans less than six square miles, real estate isn't exactly plentiful, but if you can find a gem within the town limits, you can expect to earn back an average of 8 percent of your home cost annually.

Was this page helpful?
Related Articles