Pros: Buying a beach house as an investment
Higher rates and occupancy
A beach investment property can be a fantastic earner. Generally, travelers are willing to shell out more and pay a premium to stay at the beach over inland destinations. Even better, it’s not uncommon for beach homes in popular destinations to be booked out entirely during peak season.
A lifestyle of health and wellness
Warm sand, soothing ocean waves, fresh air in your lungs. Owning a piece of coastal property isn’t just an asset for your portfolio, but also your well-being. Not to mention the seemingly endless activities and adventures—surfing, swimming, paddleboarding, boating, biking, and more.
A personal seaside retreat
Family beach bonfires at sunset. Early morning jogs on the shore with your dog. Having your own beach house can make this all happen. Plus, there’s no better place to stash your water toys, such as paddle boards, surfboards, kayaks, and beach cruisers.
A future retirement home or sizable nest egg
Years from now, your home’s value could be up and your mortgage payments paid down. Consider investing in upgrades and amenities that can boost your appreciation, such as a pool or a hot tub. When the time comes, you can cash in on the profits from selling your home. Or, kick back and enjoy your well-earned retirement in your beach house.
Tax benefits
If you rent out your beach house for more than 14 days a year, you may be eligible for vacation rental tax deductions. Possible tax-deductible expenses include HOA fees, cleaning costs, property management fees, and furniture and supplies. We recommend reaching out to a CPA to help you understand the vacation rental investment tax codes and tax laws for your state.
Cons: Buying a beach house as an investment
Ongoing maintenance and expenses
Salty sea air and constant exposure to the harsh coastal elements can take a toll on beachfront properties, requiring regular upkeep and repairs. From repainting the exterior to replacing corroded fixtures, these costs can add up over time.
Environmental concerns and natural disasters
Hurricanes and tropical storms can happen in many beachfront locations. These natural disasters can cause severe damage to properties, resulting in expensive repairs and potential loss of rental income. Insurance premiums may also be higher in these areas due to the increased risk of hurricanes.
Seasonality
While the summer months may bring in a steady stream of vacationers, the off-season can be much quieter. Depending on the location, you may have to rely on a few peak months to cover the expenses for the entire year. Or consider locations that appeal to snowbirds and other visitors year-round, such as Southern California and the Gulf Coast.
How to get more bookings during low season >
Changing regulations and short-term rental laws
Many cities—beachfront or not—have local laws and regulations that can limit how long you can rent out your vacation rental property, how often, or if you can rent it out at all. Your best bet? Refer to our latest list of top places to buy a beach house. This list only features destinations that allow short-term rentals, ranked by return on investment.
Mounting property management responsibilities
Vacation rentals take work. From marketing to house cleaning, to communicating with guests, to adjusting rates, to stocking your home, to juggling multiple booking calendars. Many vacation homeowners compare it to a second job. One solution: Vacation rental property managers—like Vacasa—who can relieve you of these hassles and handle everything to care for your vacation home and guests.
