Gulf Shores, Alabama Named No. 1 Place to Buy a Beach Home

Beaches in North Carolina, Florida, and Texas also topped the list.

Good news for Southerners looking to buy a beach home! Gulf Shores, Alabama has been named the top destination to buy a beach home in the United States, according to a new report released by Vacasa. Best Places to Buy a Beach House 2022 ranked the best U.S. destinations to purchase a vacation rental property based on average capitalization rate, the rate of return on a real estate investment.

According to the study, an average Gulf Shores vacation home or condo costs around $400,000 and yields a cap rate of around 10.2%, resulting in around $56,000 in annual gross rental revenue. To calculate average cap rate, Vacasa considered average property tax utilities, homeowner association fees, insurance, and property management fees in each destination. To determine average gross rental income, the study used performance data from the market as a whole, as well as performance data specific to Vacasa properties.

Gulf Shores/Orange Beach, Alabama
Gulf Shores & Orange Beach Tourism

While Gulf Shores took home the top spot, several other Southern beaches cracked the list's top 10. Corolla, North Carolina came in at number two, and Navarre Beach, Florida took home the number three spot. Another Florida destination, Daytona Beach nabbed the fifth spot, followed by Galveston, Texas and Hatteras Island, North Carolina at six and seven. Rounding out the top 10, Port St. Joe, Florida was named the ninth best place to buy a beach home.

When it comes to beach destinations, the South is clear and away the winning region for buying, renting, and vacationing.

"According to our 2021 Vacation Rental Buyer Report, 42% of buyers looking to purchase a vacation home chose a beach destination as the market type they'd be most interested in investing in, and for good reason," Senior Director of Real Estate for Vacasa Daned Kirkham said in a release.

During the past couple of years, beach destinations have become increasingly popular. In particular, Alabama's travel industry survived the pandemic better than 45 other states. The positive growth rate was due in large part to the state's thriving beach destinations, including Gulf Shores and Orange Beach. Coincidentally, Orange Beach took home the third spot on our South's Best Beach Towns 2022 list. Alabama also experienced its largest growth in travel search activity since 2019, rising to the number six spot for vacation search activity nationwide.

We love to see our favorite Southern destinations getting the recognition they deserve. And now we have one more reason to finally buy that Southern beach home we've been dreaming about!

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  1. Vacasa. Best places to buy a beach house 2022.

  2. Vacasa. 2021 vacation rental buyer report.

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