Short term rentals continue to be a topic of conversation on the Monterey Peninsula and Pacific Grove will be voting on the future of their vacation rentals in November. Based on the information below, STR's can be a great source of income for a home owner. There are pros and cons on both sides of the discussion similar but it's clear why some vacation rentals can be a great investment. Realtor.com® researchers recently ranked the most lucrative second-home markets, where sellers stand to cash out with some of the largest profits. Realtor.com® analyzed the 500 largest metro areas where second homes comprise at least 12 percent of the properties. They focused on the homes sold over the past 12 months and then compared the most recent sale prices to their previous ones dating back to 2008. They defined the profit as the difference between those two sales. You'll see that one market is in Northern California.
The most profitable second-home markets, according to realtor.com®, are:
Traverse City, Mich.
Annualized rate of return: 14%
Median home list price: $315,000
Claremont, N.H.
Annualized rate of return: 12%
Median home list price: $255,000
Clearlake, Calif.
Annualized rate of return: 11%
Median home list price: $325,100
Brainerd, Minn.
Annualized rate of return: 11%
Median home list price: $286,200
Port St. Lucie, Fla.
Annualized rate of return: 11%
Median home list price: $279,300
Bend, Ore.
Annualized rate of return: 11%
Median home list price: $442,000
Source:
“Chill Out, Then Cash In: The 10 Most Profitable Markets for Vacation Homes,” realtor.com® (Oct. 8, 2018)