Special Report

Best Cities to Own a Vacation Rental

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Owning a second home, whether as an investment or a vacation getaway, may seem like a luxury to most of us, but a surprising number of American households — almost eight million of them — do indeed have a secondary property.

Many of these are in rural areas or smaller towns, and the thought of retreating to a more tranquil and probably less crowded place has obvious appeal in the face of the COVID-19 pandemic. In fact, the vacation rental business is thriving right now, as private residences are seen as safer than hotels and better suited for working remotely. (However, before heading off for a getaway, it’s important to be aware of the latest COVID-19 travel restrictions in each state.)

Some locations around the country are particularly good places in which to own a vacation home, whether for personal use or rental or both, and also good places to seek out a rental for a temporary stay.

Click here to see the best places to own a vacation home.

Based on 14 metrics — including rental vacancy rate, median annual property taxes, number of local attractions, and rates of violent crime, property crime, and natural hazards — the lawn care company LawnStarter recently compared 318 destinations to compile a list of 2021’s best cities to own a vacation home.

Some are small towns, though sometimes part of large metropolitan areas; two are good-sized cities rather than semi-rural retreats. (These are America’s 50 best cities to live.)

As varied as they may be, any one of the places on this list would be a nice place to live at least some of the time as well as a good potential source of extra income.

To supplement these rankings, we added the median home value for each city on this list in 2019 and noted how that figure compared to the value of a typical home nationwide.

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10. Fayetteville city, Arkansas
> Median home value in 2019: $207,600 — #6,870 highest out of 29,913

U.S. News designated this Ozark city as the third-best place to live in America in 2016, and it shows up regularly on lists of the best retirement destinations, places to visit, and cities for business. Home of the University of Arkansas, it is known for its arts and music scene and its enlightened environmental policies. The city also boasts an extensive system of trails and parks — and its rental market is the second-best on the list.


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9. Cleveland city, Ohio
> Median home value in 2019: $69,600 — #22,746 highest out of 29,913

By far the largest city in this top ten, with a population of 396,815 (and more than 3,500,000 in its greater metropolitan area), Cleveland is acclaimed for its cultural institutions, including the Cleveland Orchestra, the Rock and Roll Hall of Fame, and the Cleveland Museum of Art. It boasts four major league sports teams, and is noted for its “Emerald Necklace” of parks and its varied downtown architecture. This puts it in the top seventh for attractions — and it holds sixth place for potential return on investment.

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8. Branson city, Missouri
> Median home value in 2019: $157,500 — #10,146 highest out of 29,913

This popular Ozark tourist destination offers a wealth of recreational opportunities in the surrounding area and a concentration of theatres, clubs, and other music venues, making it a capital of classic country and old-style pop music. It also offers the tenth best chance of getting good returns on investment property.

7. Holland city, Michigan
> Median home value in 2019: $151,300 — #10,793 highest out of 29,913

Near the eastern shore of Lake Michigan in the state’s Upper Peninsula, Holland — as its name suggests — has a rich Dutch-American heritage and hosts an annual tulip festival. It also, though, has a significant Latino population, honored with two yearly festivals. In 2010, Holland was named the second-healthiest/happiest town in the U.S. by the Well-being Index, and Farmer’s Insurance subsequently named it the most secure mid-size city in the country.


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6. Sevierville city, Tennessee
> Median home value in 2019: $188,300 — #7,796 highest out of 29,913

Dolly Parton was born in this eastern Tennessee community, and her celebrated Dollywood theme park is nearby. The town hosts two annual bluegrass festivals, a Corvette Expo, and auto races at the NASCAR SpeedPark. Sevierville is also a jumping-off point for visits to the many recreational activities available at Great Smoky Mountains National Park, the most visited national park in America. Its safety rating is about in the middle, but it scores well in the other categories.

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5. Bardstown city, Kentucky
> Median home value in 2019: $123,500 — #13,540 highest out of 29,913

Bardstown is a mecca for whiskey-lovers. It’s the self-styled Bourbon Capital of the World and host to the annual Kentucky Bourbon Festival. The downtown area is on the National Register of Historic Places, and in 2012, Bardstown was named “the most beautiful small town in America” in a “Best of the Road” competition. It’s also the tenth safest city of the 318 surveyed.


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4. Kissimmee city, Florida
> Median home value in 2019: $173,200 — #8,644 highest out of 29,913

Just outside Orlando, with its vast array of amusements (Disney-related and otherwise), Kissimmee has an historic old town, first-class athletic facilities (including numerous golf courses), and an extensive park system. It also scores near the top for rental return on investment and low rental competition.

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3. Buffalo city, New York
> Median home value in 2019: $89,800 — #18,396 highest out of 29,913

Yes, it’s the state’s second-largest city and its safety rating is comparatively low, but Buffalo and its Erie County surroundings boast plenty of attractions, including architectural landmarks (among them a complex by Frank Lloyd Wright), a vibrant lakeside waterfront, first-rate restaurants (and the bar where Buffalo wings were invented), and more. And it’s the U.S. gateway to the jaw-dropping majesty of Niagara Falls.

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2. Brooksville city, Florida
> Median home value in 2019: $61,600 — #24,156 highest out of 29,913

A city of about 7,200 people in the Tampa-St. Petersburg-Clearwater metropolitan area, Brooksville is known for its historic architecture and its proximity to the many outdoor recreational activities offered by Withlacoochee State Forest. It’s also the second-best city on the list for investment potential.


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1. Shelbyville city, Kentucky
> Median home value in 2019: $178,600 — #8,332 highest out of 29,913

This small Applachian city between Louisville and Frankfort is near numerous bourbon distilleries and also in horse country (it’s considered the Saddlebred horse capital of America). KFC founder Colonel Harland Sanders liked it well enough to make it his home for more than two decades. It offers great property investment opportunities.

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