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Well-known short-term rental management company Vacasa has ranked Navarre Beach as one of the top markets in the country to invest in a rental home to get the most bang for your buck.
Navarre Beach’s third-place ranking should come as no surprise to those paying attention to the real estate market over the last year. Experts say demand has increased significantly in the Panhandle area, causing a huge inflation of housing prices.
Those prices — though they have increased significantly in the eyes of locals — are still much more affordable to out-of-towners who otherwise would be looking in markets like South Florida or other coastal communities.
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Vacasa’s study shows that the median home sale price in Navarre Beach is $382,392, and that the annual gross income of those who list their Navarre Beach homes for rent through the company is $43,202.
Nearby Gulf Shores, Alabama, landed the company’s No. 1 ranking with potential for an average $56,198 in income for the year with just over a $400,000 home sale price, and Port St. Joe west of Panama City ranked No. 9.
Bart Pullum, president of the Navarre Area Board of Realtors, said the rental home market differs somewhat from traditional residential sales, but it’s still been as competitive and fast-moving as all of real estate has this last year.
Navarre doesn’t have many hotel options, so its tourism market is dominated by short-term rentals like houses and condos, he said.
“The majority — I would say 80% or maybe even more — of the buyers of these condos are from out of state or out of region and they come in typically wanting to purchase condos for short-term rentals, but they set aside several weeks a year for themselves and their families to use, so it’s kind of a hybrid,” he said.
Vacasa Senior Director of Real Estate Daned Kirkham said across the country, two- to three-night stays tend to dominate, but weeklong stays have increased over the last year as people — particularly those whose jobs aren’t tied to an office — seek out longer getaways.
Vacasa’s surveys also show that close to 60% of prospective buyers are looking for rental property they too could vacation at, rather than use strictly as an investment.
“Navarre Beach’s unique location, which extends out to Santa Rosa Island, makes it an ideal drive-to destination from several southern urban hubs but with fewer crowds than its neighboring beach towns,” Kirkham said.
Pullum said much like other areas of the country, the inventory in Navarre is so low that it’s very competitive to find a home, with many buyers coming up against nine or 10 other offers on their first choice. The difference in house hunting for a vacation home, though, is that many are seeking out properties across multiple cities and aren’t necessarily tied to one town.
“We see people come in from out of town who’ve been coming for 30 years with their families and they keep coming back, so I think that’s why the return on investment is so good here compared to other places,” Pullum said. “We have that hometown feel still and that’s a big selling point for tourists, so we’re proud of that. It’s very diverse and you can have anything from a studio apartment on the water for a couple hundreds thousand (dollars) or a six-bedroom Gulf-front family home sleeping 25 people that’ll go for a couple million but bring in a lot more money.”
Pullum said he expects the fast-paced market for houses with short-term rental potential will continue for at least another year.
See the full Vacasa report here.
Emma Kennedy can be reached at [email protected] or 850-480-6979.
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