Investing in vacation rental properties is one of the best ways of making money and building wealth in real estate. Recent statistics show that Airbnb hosts generated gross revenue of $14.2 billion in North America in 2019. Due to the Coronavirus-induced travel restrictions and stay-at-home orders, gross revenue dropped to $12.6 billion in 2020.
However, with the release of the Covid-19 vaccines and the reopening of economies, the short-term rental industry is expected to rebound in a significant way.
When it comes to buying a vacation home to rent out, the Florida housing market has always been one of the best locations. The advantages are numerous, including the hot Florida vacation spots and tourist attractions, the influx of tourists, the relatively affordable property prices, and the conducive Airbnb rules.
So, in this article, we will investigate the 10 best places for buying a vacation home in the Florida real estate market. But before we do that, let us first look at some reasons why you should buy a condo, apartment, single family home, or multi family home for Airbnb Florida.
Benefits of Airbnb Investing
Here are three reasons why investing in Airbnb Florida is a good idea:
- Higher rental income – An Airbnb rental with a good occupancy rate is usually more profitable than renting the same home to a long-term tenant. With this type of rental property investing, rent is charged on a nightly basis. Depending on the season, you could even increase your nightly rate to earn a higher Airbnb income.
- Tax deductions – As the owner of a vacation home that you rent out on Airbnb, you are allowed to write off the expenses you incur in the maintaining of your investment property. These include costs like occupancy taxes, supplies, cleaning costs, utility costs, and hosting fees.
- A personal getaway spot – Buying a vacation rental property means having a place where you can take a vacation with your friends or family. In addition to saving on accommodation costs, you get to spend your time off from work in the comfort of your own second home. And when it comes to vacations, Florida is definitely one of the best possible destinations in the US housing market.
What to Consider Before Buying a Vacation Home in Florida
The Sunshine State is the third most populous state in the US. With its pristine beaches, warn climate, and wide array of attractions, Airbnb Florida continues to attract millions of tourists every year. Popular attractions in the state include the Kennedy Space Center, Disney World, Universal Studios, Clearwater Beach, The Ringling, SeaWorld Orlando, and Salvador Dali Museum.
VisitFlorida.org reports that 86.7 million people visited Florida in 2020, which is a 34% decline from the previous year. However, the numbers are expected to go up significantly, thus creating a huge demand for short-term rentals.
When it comes to short-term rental laws, Florida is one of the most Airbnb-friendly states in the US. Currently, local governments are not allowed to pass laws that prohibit Florida vacation homes. Nevertheless, before buying houses in Florida to rent out on Airbnb or similar platforms, be sure to check out local government websites to stay updated on any changes in the regulations.
With regards to getting a vacation home loan for buying a house in Florida, you could consider options like a cash-out refinance, home equity line of credit (HELOC), private lenders, and real estate partnerships. Take note that lenders usually require a larger down payment and a higher credit score.
In addition, the interest rates charged for vacation homes are typically higher than those charged for primary residences.
To learn more about the factors which make Florida a great place to invest in a vacation rental home this year, watch our video below:
Best Places in Florida to Buy a Vacation House
Whether you are looking for affordable beach towns in Florida or houses for sale with pool, you can find profitable investment properties for sale on the Mashvisor real estate data analytics software. Once you’ve selected the most appropriate Florida real estate market for your Airbnb strategy, you can start searching for lucrative opportunities on our platform.
When thinking about where to buy vacation homes in Florida, the most important metric to consider is the cash on cash return. Based on the latest Mashvisor Airbnb data, here are some of the best towns in Florida for Airbnb investment:
1. Deland, Florida
Deland is the most profitable location for owning a vacation home in Florida this year, according to Mashvisor data
- Median Property Price: $316,223
- Price per Square Foot: $157
- Average Airbnb Daily Rate: $115
- Monthly Airbnb Rental Income: $2,595
- Airbnb Cash on Cash Return: 4.86%
- Airbnb Occupancy Rate: 60.37%
According to our Airbnb data analytics, Deland leads the list of the best places for buying a vacation home in Florida. This city offers the highest average return on investment for short-term rentals.
While 4.86% might not seem like a good cash on cash return for seasoned investors, you should keep in mind that this is just a city average, while Mashvisor can help you find Florida real estate income properties that bring double-digit returns.
2. Plantation, Florida
- Median Property Price: $405,098
- Price per Square Foot: $213
- Average Airbnb Daily Rate: $235
- Monthly Airbnb Rental Income: $3,365
- Airbnb Cash on Cash Return: 4.24%
- Airbnb Occupancy Rate: 59.19%
Second on our list of the best places to buy rental property to offer on Airbnb this year is Plantation. If you’re looking for strong Airbnb income, that’s the right location for you.
3. Oakland Park, Florida
- Median Property Price: $354,653
- Price per Square Foot: $267
- Average Airbnb Daily Rate: $182
- Monthly Airbnb Rental Income: $2,932
- Airbnb Cash on Cash Return: 3.98%
- Airbnb Occupancy Rate: 60.28%
Yet another top location for buying a vacation home in Florida is Oakland Park. This vibrant community offers many attractions for domestic and international tourists.
4. Tallahassee, Florida
- Median Property Price: $296,750
- Price per Square Foot: $162
- Average Airbnb Daily Rate: $145
- Monthly Airbnb Rental Income: $1,923
- Airbnb Cash on Cash Return: 3.77%
- Airbnb Occupancy Rate: 51.65%
The multitude of historical and cultural attractions easily turn the capital of Florida into one of the hottest destinations for Airbnb investments.
5. Jacksonville, Florida
- Median Property Price: $285,686
- Price per Square Foot: $159
- Average Airbnb Daily Rate: $132
- Monthly Airbnb Rental Income: $2,054
- Airbnb Cash on Cash Return: 3.67%
- Airbnb Occupancy Rate: 58.92%
Jacksonville continues to be one of the top markets for buying a vacation home in Florida this year. The below-average home values make it an ideal destination for beginner investors who face budget constraints.
6. Gainesville, Florida
- Median Property Price: $372,896
- Price per Square Foot: N/A
- Average Airbnb Daily Rate: $149
- Monthly Airbnb Rental Income: $2,304
- Airbnb Cash on Cash Return: 3.60%
- Airbnb Occupancy Rate: 55.25%
Airbnb Gainesville should remain on the radar of savvy real estate investors looking for the best places for buying a vacation home in the Sunshine State. The combination of property values and Airbnb revenue results in a high rate of return for short-term rentals.
7. Lakeland, Florida
- Median Property Price: $339,394
- Price per Square Foot: $166
- Average Airbnb Daily Rate: $104
- Monthly Airbnb Rental Income: $2,089
- Airbnb Cash on Cash Return: 3.49%
- Airbnb Occupancy Rate: 60.67%
The analysis conducted by the Mashvisor real estate investment software places Lakeland as number 7 among the most profitable Airbnb locations in Florida.
8. Pensacola, Florida
- Median Property Price: $585,122
- Price per Square Foot: $265
- Average Airbnb Daily Rate: $137
- Monthly Airbnb Rental Income: $3,125
- Airbnb Cash on Cash Return: 3.44%
- Airbnb Occupancy Rate: 68.00%
If your investment budget is relatively larger or you have access to good real estate investment loans, you should consider buying an Airbnb Florida property in Pensacola. This city benefits from a particularly high Airbnb occupancy rate, even when compared to the rest of the Florida housing market.
9. Bradenton, Florida
- Median Property Price: $515,287
- Price per Square Foot: $228
- Average Airbnb Daily Rate: $142
- Monthly Airbnb Rental Income: $2,510
- Airbnb Cash on Cash Return: 2.63%
- Airbnb Occupancy Rate: 64.01%
Number 9 on our list of the top markets for investing in a short-term rental property in Florida this year is Bradenton. Despite the above-average home values, this city brings good cap rate and cash on cash return to Airbnb hosts.
10. St. Petersburg, Florida
- Median Property Price: $303,020
- Price per Square Foot: $223
- Average Airbnb Daily Rate: $117
- Monthly Airbnb Rental Income: $1,497
- Airbnb Cash on Cash Return: 2.53%
- Airbnb Occupancy Rate: 55.57%
Last but not least, you should look into St. Petersburg when exploring where to buy a vacation home in the Florida real estate market.
Conclusion
Knowing the best places for buying a vacation home in Florida is a good place to start. Once you’ve decided on the best vacation spots in Florida for your particular investment needs and requirements, you can find an affordable and profitable rental vacation house on the Mashvisor platform.
Furthermore, you can analyze the profitability of each Florida beach house using the investment property calculator. You will see metrics presented above in addition to estimates of the rental expenses, cash flow, and Airbnb cap rate. We’ll help you turn 3 months of real estate research and analysis into 15 minutes.
To get access to our real estate investment tools, click here to sign up for a 7-day free trial of Mashvisor today, followed by 15% off for life.