The Top Southern Vacation Escapes

Trista - January 23, 2020

You may not have always had the extra cash to invest in a vacation home, but dreaming about it is free. Whether it’s a log cabin in the Smokies or a beach condo in Florida, second homes are often seen as a personal oasis – somewhere you can get away from the pressures of daily life for a while.

For anyone who can afford a second home, however, they can be more than that: a report by indicates that some cities are particularly valuable investments when it comes to vacation rentals, due to their destination popularity, rental demand, revenue growth, and affordability of real estate. Check out some of the best cities and states in the south to start house hunting for a vacation home.

A relaxing day at the beach could do you some good. Shutterstock.

Gulf Shores, Alabama

The first city to make the list is in the heart of the south. Gulf Shores is known for its snowy white sand and clear Gulf waters, as well as for being the most lively beach town in the state. Loyal visitors come back year after year (and sometimes multiple times a year), which makes it a great place to invest your money.

Annual rental income averages around $16,700 in Gulf Shores, though buying a house in the area will set you back by an average of $345,135. If you don’t plan on living in this home, and truly using it for a vacation home, you should consider renting it the months you are gone.

Walk along the warm sandy beach and let your mind relax. Shutterstock.

Orange Beach, Alabama

Whether you love the gulf’s white sands or you’re more of a mossy tree lover, Orange Beach has something for you. The Backcountry Trail – perfect for bikers and hikers – intersects with Gulf State Park and extends to Gulf Shores. Water-sports fans will be plenty occupied with kayaking, parasailing, and paddleboarding!

Visitors and residents alike can spend a relaxing afternoon at Waterfront Park for some fishing or picnicking at the pier then head over to the Wharf for dinner, shopping, a Ferris wheel, and an amphitheater. The median price of homes that sold in 2019 is $339,200.

See a wide variety of the state’s birds in their natural habitat. Shutterstock.

Dauphin Island, Alabama

Dauphin Island, also known as “the sunset capital of Alabama,” lies on a narrow, 14-mile barrier off of the state’s coast. The island, in its entirety, is a protected bird sanctuary, which explains one of its most popular attractions: the Audubon Bird Sanctuary. Approximately 1300 residents take advantage of the many other attractions like the Dauphin Island Sea Lab, Fort Gaines, the white sandy beaches, golf courses, parks, and multiple piers.

Mobile, Alabama, (and its airport) is only a short ride away, making Dauphin Island easily accessible without missing out on its natural beauty. The median home sale price is $345,281, though investors can expect a capitalization rate of 6.7% on their property.

Natural hot springs are a great way to relax, even if they have a distinctive aroma. Shutterstock.

Hot Springs, Arkansas

Aptly named for its natural hot springs and nestled in the Ouachita Mountains, Hot Springs is a resort city in the state of Arkansas, also known as the Valley of the Vapors. The hot spring water has been popularly believed for centuries to possess magical healing properties and was developed into a thriving spa town after 1832’s federal protection ruling. The city contains countless historic buildings, hotels, and motor courts built in the Art Deco style. It is a desirable destination for music, art, and film festivals.

Despite the city’s popularity, it has surprisingly affordable home prices, so second homeowners can expect a rental property to return over 10% of its purchase price annually! That is a chance for you to have a streaming income from your own vacation home. Sounds like a win-win situation.

Take a walk on the beach after having a delicious dinner at one of the local restaurants. Shutterstock.

Rehoboth Beach, Delaware

This little town only stretches over one square mile and overlooks the Atlantic. The Rehoboth Beach Boardwalk is a wooden, one-mile long boardwalk adjacent to the beach with restaurants, shops, amusements, and attractions. Though the year-round population is less than 2000 residents, the seasonal population swells to over 25,000 just within city limits, making it a highly desirable rental property location.

It is a dream beach for those who want to get away from the hustle and bustle of a big resort town, but still desire to have the chirping birds and ocean breeze in your window. You should consider getting a vacation home in Delaware, even though it is a bit farther north then you expected.

This delightful beach is near the Kennedy Space Center, so you can watch a few rocket launches if you’re lucky. Shutterstock.

Cocoa Beach, Florida

Just the name of this town alone makes people flock to the mouth-watering area. Whether travelers are looking for a romantic getaway or a fun family vacation, Cocoa Beach has something for them. This fun and affordable city offers up multiple beaches, a public golf course, plenty of shopping and dining experiences, and all the nightlife they could want.

Even more, visitors can watch rocket launches from Shepard Park – named after astronaut Alan Shepard – so guests can check the Kennedy Space Center launch calendar, pack a picnic, and have a blast!

A peaceful day by the lake and a glass of sweet tea in your hand will take your troubles away. Shutterstock.

Davenport, Florida

Davenport is a small city that has grown almost 200% in just the last ten years, from under 3000 residents to just under 5500 currently. It’s about an hour away from Orlando, making it a short ride away from the theme park magic we all crave without the crowds we dread. The top-rated attractions in Davenport include the True Blue Winery and, of course, Lake Davenport.

The median home sale price is quite reasonable at $255,390, with a capitalization rate of 8.4%. That might be a bit steep for a vacation home; however, imagine the rental income you can make when you aren’t at this second house.

Key West is a popular tourist destination, so don’t expect a quiet vacation. Shutterstock.

Key West, Florida

The southernmost city in the continental US and the westernmost island connected by a highway in the Florida Keys, Key West lies at the end of US Route 1 – the longest north-south road in the country. The city has a history of attracting writers and artists, including Ernest Hemingway, in the 1930s and Tennessee Williams in the 1940s!

The town also has always had a “live and let live” attitude and elected its first openly gay mayor in 1983, thus becoming a popular LGBTQ destination for decades. Its abundance of sunshine, fishing, water sports, and nightlife make it a popular vacation destination and a profitable investment for second homeowners. However, the price tag on these homes may be a bit steep. The median home sale price in Key West is $763,109, with an average capitalization rate of 6.1%.

Although it’s near a swamp, there are plenty of sites to see and experience. Shutterstock.

Kissimmee, Florida

Florida is a favorite on this list, of course. It has something for everyone: couples, college kids, families, solo travelers, young and old alike. And in a state known for Disney World, how could you possibly go wrong? Kissimmee, with its affordable prices and Walt’s old stomping grounds, yields the highest return on investment in the Sunshine State.

Other nearby theme parks include SeaWorld, Legoland, and Universal Orlando Resort, which just announced a significant expansion. Tourists can also enjoy the Kennedy Space Center, GatorLand, swamp tours, and endless golf courses. The median home sale price in Kissimmee is $264,863, with a capitalization rate of 7.2%.

Panama City Beach has a flourishing nightlife. Shutterstock.

Panama City Beach, Florida

Yes, another Floridan resort town, but isn’t that what vacation homes are really all about? One of Florida’s most popular resort towns, Panama City Beach is visited by millions of visitors each year. It’s paper-white sand, and clear water makes for picture-perfect vacations whether visitors want to relax in the warm sun.

Maybe you prefer to play water sports like sport fishing, boating, surfing, skiing, or hiking along the ocean-side trail. Deep-sea diving allows swimmers to discover artificial reefs and ocean creatures, too – there’s something for everyone here. The median home sale price in Panama City Beach is $278,500.

This landmark has a rich history that everyone should learn more about while you visit. Shutterstock.

Saint Augustine, Florida

Okay, last Florida one for now — promise! Saint Augustine, with its Spanish colonial architecture and sandy beaches, is a top vacation destination for American and international travelers alike. The area is rich in history and has lovely natural attributes like Anastasia State Park, a protected wildlife sanctuary.

The warm weather allows for year-round tourism, while the lower real estate costs leave an excellent opportunity to generate a return on your investment in a second home. The median home price is $209,100, with an estimated median revenue of $50,989 per year!

This gorgeous location would make for a nice hiking trip. Shutterstock.

Blue Ridge, Georgia

Though Blue Ridge is a small town, it makes a high impact on those who visit. It is named after the mountain range that paints the skyline. Once you see it, you’ll understand why it is considered one of the best vacation destinations in the country. Through the last few decades, the city has seen a surge in LGBTQ rights, which has a more significant percentage of the population than is usual for a small, rural community.

Blue Ridge is prime for fishing, kayaking, and tubing, in addition to exploring nature through the Aska Adventure Area. The average capitalization rate on an investment home in this area is approximately 5.4%.

A quiet little town, Ellijay is best known for being the apple capital of the state. Shutterstock.

Ellijay, Georgia

Though a Georgia peach is the natural fruit that comes to mind when you think of the state, Ellijay may change your mind about that. Ellijay is known as the Apple Capital of Georgia and hosts the annual Georgia Apple Festival in early October. For two weekends, hundreds of vendors gather for a festival of live music, arts and crafts, and of course, apples, with a theme centered on Northern Georgia culture.

Ellijay isn’t just about apples, in any case. It’s also considered the Mountain Biking Capital of the state because it has so many trails, like the Mulberry Gap Mountain Bike Getaway that offers guided single-day rides or even multiple-day tours, some of which are also pet-friendly. The median sale price for homes in Ellijay is $232,400. Home values have gone up 5.6% over the past year with the prediction that they will rise 1.4% within the next year.

You can go for a relaxing cruise or just sit on the dock and watch the ships go by early in the morning. Shutterstock.

Savannah, Georgia

When you hear of Georgia, what do you think of instantly (besides peaches)? Well, Savannah is the place to be if you want some down-town Georgia fun — and a great price. Savannah has the third-highest rental return in the country, so if you’ve ever dreamed about owning a little cottage on the waterfront, it’s time to make your dreams come true.

Savannah has reasonably priced real estate compared to other popular tourist destinations and can bank you an annual average of $13,700 in rental income. Things to do in Savannah include culinary tours, trolley rides on the Old Town Trolley, strolling through Forsyth Park, and of course, Savannah ghost tours!

Louisville has a rich history of baseball memorabilia. Shutterstock.

Louisville, Kentucky

The Kentucky Derby alone is a great money-maker for any homeowner in the area. Outside of Churchill Downs, visitors can enjoy the zoo, the Louisville Slugger Museum, theme parks, bourbon distilleries, and countless historic sites. There is something for everyone in this Kentucky city.

Even though there is plenty more to say about Louisville, it is important to note how a vacation home could fare there. Homeowners can expect to earn more than 10% of their home purchase price annually here! That is a huge piece of the pie in terms of a second income.

New Orleans is the birthplace of jazz and fantastic French creole food. Shutterstock.

New Orleans, Louisiana

Ah, the Big Easy – home of jazz, hurricanes (the drink), and Bourbon Street. If you need to know any Cajun French, try this on for size: “Laissez les bon temps rouler!” It means “Let the good times roll,” and it is New Orleans’s motto.

As one of the most famous, or possibly infamous, cities in the world, New Orleans attracts visitors from all over thanks to a variety of festivals, cuisine, and clubs. For anyone with an interest in owning a second home, New Orleans is a smart investment: rental properties here can earn an average annual rental income of $16,800.

Ocean City gets flooded every summer with out-of-state tourists. Shutterstock.

Ocean City, Maryland

Again, this city is going to take you up the east coast a ways, but hear it out. This tiny little resort town has a ton of family activities like a theme park, a boardwalk, and a long, dreamy beach – all perfect for a summer vacation. Then, when you head home to the south for the rest of the year in your regular home, it’s still warm, too!

All this combined means a high return on your investment if you own a second home in the area. The median sale price of a home in Ocean City is around $265,600, with an expected growth rate of about 1.7% in the next year.

Nothing is more relaxing than just listening to the waves lapping against the shore. Shutterstock.

Pass Christian, Mississippi

The M-I crooked letter state has a lot to offer in terms of town culture and rental income. Pass Christian is not one of those booming urban cities. Think about the sleepy towns you read about in picturesque storybooks or see in romance movies – that’s what Pass Christian is like. It’s a quaint little laid-back town with leisurely antique stores and strolls along the beach.

Investing homeowners can find a place for a reasonable price – the median home value in Pass Christian is $189,965, and you can expect to earn about 9% of that back annually. That is a great return if you are planning on getting a southern vacation home.

The price of visiting Branson is definitely worth the cost because there’s so much to do. Shutterstock.

Branson, Missouri

Though Missouri may not top most vacation destination lists, it’s definitely a great contender. Surely you have heard of the amazing city of Branson, right? There’s no shortage of fun activities in this area from theme parks to specialty museums, shops, and all kinds of shows year-round.

Not only that, but this stat is known for its amazing Ozarks. It is a beautiful vacation spot for families and couples, making it an excellent opportunity for investors who want reliable returns without spending a fortune. The median home price averages about $145,000, with rentals producing around $24,062 in revenue annually.

Osage Beach is home to the Ozark Brewery, which you should visit. Shutterstock.

Osage Beach, Missouri

Here is another hidden town that looks simply majestic in the great state of Missouri. With 1100 miles of shoreline and activities to keep you busy, whether on or off the water, Osage Beach is a great vacation destination. Visit the famous Swinging Bridge for a picnic – or a drive across if you’re brave enough.

Take a drink at the local Ozark Distillery and Brewery or visit the Bagnell Dam, or just enjoy the beach and beautiful weather. No matter what, a second home in Osage Beach can bring in an average annual rental income of $14,100.

Go for a hike and take some beautiful pictures you can bring home to share with your family. Shutterstock.

Maggie Valley, North Carolina

Maggie Valley lies in the Smoky Mountains outside of Asheville, North Carolina, which is the real driver of tourism in this area. The natural beauty of the city provides year-round activities: skiing in the winter, hiking in the summer, and watching the leaves change in the fall. Travelers can explore mountains, waterfalls, mountain distilleries, and tubing resorts.

Real estate costs in this area are surprisingly low: median home prices are around $155,000 and a median rental annual income of $38,949! Of course, many of these numbers depend on the amenities provided, like the outdoor area, the views, hot tubs, fire pits, and decks.

An excellent location that’s near a lot of attractive resorts, Whittier is the gateway to fun. Shutterstock.

Whittier, North Carolina

Another area just outside Asheville known for its arts is Whittier. Its population is a mere 5,600, though that changes seasonally with influxes of tourists. The small town is close to numerous big-name attractions like the Nantahala National Forest, the Eastern Cherokee Reservation and its casino, Dollywood in Pigeon Forge, Tennessee, and opportunities for gem mining, hunting, fly fishing and rafting!

The median home sale price in Whittier is $178,000, with an average capitalization rate of around 7.9%. If you desire to live in a quiet yet artsy town, Whittier might be the perfect spot for your southern vacation home.

If walking along the pier isn’t your thing, the beach is rife with exciting water sports. Shutterstock.

Wrightsville Beach, North Carolina

Just one more town in North Carolina tops the list. For anyone who can afford a larger payment for a second home (to the tune of almost a million dollars), Wrightsville Beach is the place for you. It’s a small resort town, but rental income in the area can average nearly $50,000 per year, which is a huge chunk of change for most people.

Known for its indigo blue waters, beautiful beaches, and sporty island lifestyle, Wrightsville Beach is ideal for water sport activities like surfing, stand-up paddle boarding, and kayaking. That is just a few of the things to do in this North Carolina paradise.

Oklahoma City also has a vibrant nightlife that you’ll never want to end. Shutterstock.

Oklahoma City, Oklahoma

OKC is the largest city in the state and attracts all kinds of renters: business and pleasure travelers alike. Visitors can explore museums, shops, art venues, theater, and more. But what about buying a vacation home in Oklahoma City? When you add that to the low cost of real estate, you can’t go wrong!

Investors can expect to pay off the value of their second home in about ten years. The median sale price of homes in Oklahoma City is currently $151,200, with an expected growth rate of approximately 3%.

There is plenty of variety when it comes to living in Hilton Head. You’ll never be bored. Shutterstock.

Hilton Head, South Carolina

It’s time to visit South Carolina — a stunning state! Hilton Head is an excellent option for any vacation homeowner – it has opportunities ranging from the $300,000s to over 1 million dollars, so there should be something to please almost anyone who can afford a second home. You will certainly adore the new home features as well as the gorgeous city.

The area offers beaches, golf courses, luxury resorts – you name it, it’ll be there. However, this town is not the only one to make the list from South Carolina. Maybe you want to stay somewhere more famous.

Myrtle Beach is the place to be if you want every day to be more interesting than yesterday. Shutterstock.

Myrtle Beach, South Carolina

This seaside town is known for a 60-mile stretch of beach plus its many theme parks, museums, and shops. It draws in about 14 million visitors annually, whether they come in for the golf courses, the theater, the boardwalk, festivals, bike rallies, or car shows.

Nine carriers serve Myrtle Beach International Airport, so you know it’s not difficult to get to, and Charleston is less than three hours away by car. Despite its popularity, Myrtle beach isn’t too pricey to invest in. The Median home sale price is around $213,950, with a capitalization rate of about 6.2%. Something to note with Myrtle Beach homes – proximity to the beach does seem to be a factor in the success of the rental, and association fees can play a large part in costs and upkeep.

If country music is your thing, then Nashville is definitely the city for you. Shutterstock.

Nashville, Tennessee

Have you ever visited the capital of Tennessee? It has so much to offer for all ages. Nashville is famous for its lively country bars, urban skyline, tasty food, and wild nightlife. It somehow manages to have the Southern charm of an old town while giving off a unique urban feel – something that has undoubtedly contributed to its growth today.

Second homeowners in the booming Music City can expect to earn an average annual rental income of nearly $20,000, and median home sale prices are around $284,200. That equates to a great amount if you are looking for a vacation home in Nashville, Tennessee.

The biggest attraction here is Dollywood, which sees millions of visitors each year. Shutterstock.

Sevierville, Tennessee

Sevierville, Gatlinburg, and Pigeon Forge are all quite breathtaking. Native singer and actress Dolly Parton bought an interest in a local park in the late 1980s. They renamed it Dollywood, sealing the area’s claim to fame. The city had previously been a popular destination because of the Great Smoky Mountains National Park. However, Dolly’s new park was a whole new game.

The resort is now the state’s biggest attraction, with almost 3 million visitors annually, leading to the development of countless other attractions in the area. What does that mean for homeowners? The median home sale price is around $239,976, with a healthy capitalization rate of 10.3%.

Rentals can be a little expensive, but they give you a magnificent oceanside view. Shutterstock.

Surfside Beach, Texas

Only an hour away from beachy Galveston, Surfside Beach is known for its own lovely beaches and a laissez-fair attitude. With few of the usual tourist gimmicks, the residents and visitors of this area usually spend their time with loved ones rather than looking for activities or attractions. For second homeowners, that emphasizes fully equipped vacation rentals, but it’s quite affordable in Surfside.

The median home sale price in Surfside Beach was $136,500 – a far cry from the stilted homes in the Galveston area that range from $200,000 to $400,000. Average rental revenue of $29,321 gives this area on the Gulf Coast a notable capitalization rate of 15%. For interested investors, make sure to look for a property with ocean views and beach proximity; these are the factors that impact rental success in areas like this.

There are literally miles of beach to walk on, so you may never see another living soul on any given day. Shutterstock.

South Padre Island, Texas

Another Texan town made the list for excellent places to purchase a southern vacation home, and its South Padre Island. With its miles of beaches, family parks, birding activities, and nature center, what’s not to love about South Padre Island?

This barrier island resort town attracts enormous crowds to the Gulf Coast each year, so investors can expect to pay off their second home in just over ten years. The median sales price averages around $255,817 in this area, which isn’t bad considering the bank you’ll make!

Who wouldn’t want to spend their days on this beautiful, peaceful beach? Shutterstock.

Virginia Beach, Virginia

This state is known for its mostly sunny days. If you don’t want to pay an arm and a leg for a Southern California home, try the other coast instead. Virginia Beach has a little bit of everything from great weather to rich culture.

If you’ve got an extra $279,458 lying around, consider spending it on a second home in Virginia Beach. Visitors love the beach, boardwalk, museums, and craft breweries in the area, so investors can expect to make almost $20,000 per year in rental revenue. After all, Virginia is for lovers – of suitable investments.

An old-timey town can offer a lot to those who are looking for a more quiet lifestyle. Shutterstock.

Charles Town, West Virginia

If you’re looking for a second home in an area that’s beautiful but also has a deep history, look no further. This teeny town has charm, natural beauty, and stories to tell – if it were a person, we’d take them out on a date.

Instead, we encourage you to consider buying a home there. Though it is hard to come across the real estate in the area because of how small it is, homeowners can earn back an average of 8% of their home costs annually. The median home sale price is about $250,611, making it reasonable, though not highly affordable. This list by no means covers every great vacation town that could make a substantial investment. However, we hope it points you in the right direction and has you thinking about different options!