If you’re considering investing in a home in Outer Banks, you’re not alone – there are many vacation rentals in Nags Head, Corolla, Duck, Southern Shores and Hatteras Island, as well as in other OBX communities. The reason: These places are highly desirable, and often, people would rather stay in a vacation home than a standard, run-of-the-mill hotel.
But is Outer Banks a good investment for you?
Here’s what you need to know.
Is Outer Banks a Good Investment?
First things first: Tourists adore the Outer Banks. This is a top vacation destination for millions of people each year. About 2.61 million people visited Cape Hatteras National Seashore last year. In fact, Dare County is fifth in the state for tourism spending – in 2018 alone, the area pulled in more than $1.9 billion. (That’s the last year for which data is currently available.)
A tremendous number of those people needed – and found – a place to stay.
Why Outer Banks May Be a Good Investment for You
When you buy an investment property in OBX, you have two options: You can be an absentee owner, visiting the property only occasionally to check on its condition (or to make repairs or upgrades), or you can be a part-time resident who rents the property out when you’re not using it.
Renting out your Outer Banks home is a good way to recoup some – or all – of the money you’re spending on monthly mortgage payments. However, it’s not for everyone. You’ll have to decide whether you want to rent it for long periods of time (such as by having tenants sign a yearlong lease) or you want to use it as a vacation rental, listing it on sites like Airbnb and others. Additionally, you’ll most likely want to hire a property manager to handle the day-to-day aspects of home ownership for you, particularly if you don’t live in the area.
What if You Decide Outer Banks IS a Good Investment for You?
If you’re thinking about buying an investment property in Outer Banks, use these tips to find the right place:
- Stay objective. Renting out a house is a business, so you have to look at – and treat – it that way. You’re looking for a property that will bring in the best possible profit, but that doesn’t necessarily mean it’s going to be a home you fall in love with (like it would have to be if you were purchasing a primary residence for yourself).
- Be realistic. Sometimes sellers make an investment property seem like a huge money-maker – but the reality is that you should talk to your OBX REALTOR® about rental projections to find out where your money is best-spent.
- Do a complete cost analysis. You’ll need a down payment as well as the cash to make monthly mortgage payments. You’ll also need to cover maintenance, updates and repairs, as well as insurance (including wind and flood coverage). Remember that there will likely be periods – long or short – that your home sits empty. As a result, you won’t have rental income. Additionally, owning a second home has tax implications that you should discuss with your financial adviser.
Is Outer Banks a Good Investment? Let’s Talk!
If you’re considering investing in a home in the Outer Banks, we can help you decide what’s right for you. We’ll be happy to show you any listing, run all the numbers, and provide you with all the information you need to make the right choice.
While you’re here, please feel free to explore:
- Avon real estate listings
- Buxton real estate listings
- Corolla real estate listings
- Duck, Southern Shores and Kitty Hawk real estate listings
- Frisco real estate listings
- Hatteras real estate listings
- Kill Devil Hills real estate listings
- Manteo real estate listings
- Nags Head real estate listings
- Rodanthe, Waves and Salvo real estate listings
When you find a home you want to see, call us at 252-491-3333 or contact us online. We’ll be happy to schedule tours of your favorites. Outer Banks Realty Group’s team members know everything there is to know about the area and the rental market here – and we’ll be glad to share our experience and expertise with you.