What to look for when buying a vacation rental property

Investing in a vacation rental property can be an exciting and profitable venture — if you choose the right one. Whether you're dreaming of owning a beachside bungalow, a cozy cabin in the woods, or a trendy city apartment, there are key factors to consider before making your purchase. Here's what to look for when buying a vacation rental property.

1. Location, Location, Location

The golden rule of real estate applies even more so with vacation rentals. Look for:

Tourist demand: Is the area a popular travel destination year-round or seasonally?
Proximity to attractions: Beaches, ski resorts, national parks, downtown areas.
Accessibility: Is it easy to reach by car, plane, or public transportation?
Local amenities: Restaurants, grocery stores, entertainment options.

Tip: Use platforms like Airbnb and Vrbo to research top-performing neighborhoods.

2. Rental Regulations & Zoning Laws

Before falling in love with a property, investigate local laws and HOA rules:

Some cities and towns have strict short-term rental regulations or bans.
Check if there are permit requirements, occupancy taxes, or zoning restrictions.
Make sure HOAs allow short-term rentals if you're buying in a managed community.

3. Financial Potential

Run the numbers before making a commitment:

Estimate occupancy rates, seasonal pricing, and yearly income potential.
Don’t forget to factor in expenses like:
- Property management fees
- Utilities and maintenance
- Cleaning and restocking
- Insurance and taxes
Use tools like AirDNA or Mashvisor to forecast income based on real data.

4. Property Condition & Maintenance

Vacation rentals need to be well-maintained to keep guests happy:

Inspect for needed repairs, updates, and compliance with safety codes.
Look for durable materials and low-maintenance landscaping.
Consider whether you’ll self-manage or hire a property manager — remote properties often need local support.

5. Guest Appeal

Ask yourself: “Would I want to stay here?”

Unique features like hot tubs, fire pits, balconies, or water views can boost bookings.
A functional layout, quality furnishings, and modern amenities are key.
Pet-friendly properties or homes with space for families can appeal to wider audiences.

6. Seasonality & Local Events

Know the rental rhythm:

Is the destination popular year-round or just a few months a year?
Are there festivals, holidays, or events that attract guests and boost occupancy?
How will your income fluctuate throughout the year?

7. Exit Strategy & Appreciation Potential

Even if your main goal is rental income, consider long-term value:

Is the area growing in popularity or infrastructure?
What’s the resale potential?
Can you use the property personally if demand drops?

Final Thoughts

Buying a vacation rental property can generate both income and enjoyment — but success depends on smart decisions. Do your research, understand the local market, and make sure the numbers work for your goals. With the right property, you’ll be hosting happy guests and growing your investment in no time.