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The Best Place to Buy a Lake House
If owning a beach house isn’t quite your thing, how about a lake house? Many travelers’ idea of the ultimate holiday is being surrounded by a silver lake.
A quick look at the lake house market in the United States reveals that there’s a very good chance that you’ll find a property that you can afford.
Sure, if you look at the price tag of some waterfront properties you would expect to own the lake too. However, the median listing price can vary quite significantly.
Apart from the property price, you’ll also need to keep in mind that your estimated yearly expenses might be more than owning a vacation rental in an urban area.
You’ll have to plan for more wear and tear which comes with living so close to the water and your insurance and utility expenses will likely also be higher.
That said, combine the high demand with the median rental revenue and it’s generally a good vacation rental investment.
Choosing the Perfect Lake House: Important Things to Consider
Whether you're buying a lake house as a peaceful retreat or as an investment for vacation rentals, there are a few things to think about to make sure your decision fits your aspirations and financial objectives.
Every lake and the community around it has something special to offer, from the serene shores of Smith Mountain Lake to the busy activities around Lake Ozark.
Here are some things to consider when choosing your dream lake home:
Place and Size of the Lake
The kind of experience you and possible renters will have at your lake house is greatly influenced by its location.
Are you drawn to well-liked year-round locations with an abundance of recreational opportunities, like Lake Tahoe or Lake Michigan, or are you searching for a tranquil getaway in pristine lakes like those in the Finger Lakes Region?
While larger lakes may offer more opportunities for social activities and water sports, smaller lakes, like Island Lake or Silver Lake, offer charming, intimate settings.
Community Living vs. Waterfront Property
Depending on your preferences for privacy, lake access, and community amenities, you may choose between a lakefront property and a house inside a community.
Because they have easy access to the lake and beautiful scenery, waterfront homes are very popular for both personal use and vacation rentals.
On the other hand, vacation rental properties in lake communities like Brainerd Lakes Area or Pocono Lake Area can also be attractive because they frequently offer shared amenities like clubhouses, swimming pools, and golf courses.
Performance Metrics for a Lake House Vacation Rental:
It's important to comprehend the local vacation rental performance metrics if you're thinking about investing in vacation rentals.
To determine possible profitability, research average daily rates, occupancy rates, and median rental income in areas such as Traverse City or Saranac Lake.
These metrics can be interpreted by vacation rental companies and platforms, which will assist you in determining the market value of the vacation rental and the potential net income of the property.
Recreational Possibilities
The attractiveness of your lake house can be greatly increased by the presence of major attractions and outdoor activities.
Properties with paddle boarding and ice fishing possibilities, hiking trails, ski resorts, and other outdoor activities can draw a diverse range of outdoor enthusiasts.
Being close to charming stores, picturesque lakes, and theme parks can also up the appeal and turn your property into a well-liked year-round travel destination.
Yearly Expenses and Estimated Yearly Expenses for Lake Houses
The costs associated with owning a lake house go beyond the average listing price. Take into account the expected annual costs for upkeep, real estate taxes, and insurance, particularly for waterfront properties where there may be additional expenses.
By being aware of these costs up front, you can make smart financial decisions and protect the profitability of your vacation rental investment.
Where’s the Best Place to Buy a Lake House?
Often times you can examine your own desires and must haves when it comes to buying a top lake house vacation rental.
The desire to just look at scenic lakes and pick the best spot might be your first instinct, but we've taken a look at some vacation rental performance metrics through AirDNA's MarketMinder tool.
We've looked at the market value in each area, the median listing price of property, and what the potential revenue might be for your vacation rental based on occupancy rate and ADR.
We're aiming for a location that's going to allow for your property's net income to be as high as possible.
1. Finger Lakes, NY
The Finger Lakes in New York are a year-round destination. The perfect weekend escape, business trip, vacation, or overnight stay is never far away thanks to the 11 immaculate lakes located in the center of upstate New York.
Major hubs such as New York City, Toronto, Boston, Pittsburgh, Philadelphia, Baltimore, Washington, DC, Cleveland, and more are all within a short drive of the Finger Lakes. This means it's an ideal weekend away destination for potential guests.
- Annual Revenue: Approximately $47,700
- Occupancy Rate: 50%
- Average Daily Rate (ADR): $333.30
2. Saranac Lake, NY
Nestled in the Adirondack Mountains, Saranac Lake is the ideal place to buy a lake house. Tucked away in New York's Adirondack Mountains, Saranac Lake is a center for outdoor recreation, fascinating history, and exciting cultural events. There are lots of things to do and see in this quaint village and the surrounding wilderness.
For starters, there's the Adirondack Scenic Railroad, a scenic train ride like something out of a movie with stunning views of the mountains, forests rolling hills, and waterways.
Lake houses on Saranac Lake have access to hiking trails for any level of hiker, so whether you're looking for a short hike or a big climb, there's something for outdoor enthusiasts of every kind.
It is truly the best place to buy a lake house for your vacation rental company if you're catering to outdoorsy clientele.
- Annual Revenue: Approximately $20,800
- Occupancy Rate: 35%
- Average Daily Rate (ADR): $292.40
2. Branson, MO (Table Rock Lake)
A stunning, crystal-clear lake with almost 800 miles of shoreline for swimming, boating, fishing, and other water sports, Table Rock Lake is an idyllic spot to snag a lake house. Campsites, picnic spots, and hiking routes can be found in the Table Rock State Park surrounding the lake.
The natural beauty of the Ozarks, with the vast expanse of the lake, opens up a world of fishing, boating, and hiking, inviting nature lovers to dive into endless activities amidst stunning scenery.
Did I mention the theme park that's 1880-themed? But there's more to Branson than just thrills and nature. The Titanic Museum offers a poignant glimpse into history with its interactive exhibits and real-life artifacts, while Branson Landing brings shopping, dining, and eye-catching fountain shows to the water's edge.
It's an interesting mix of the excitement of theme parks, the calm of the great outdoors, and the allure of live shows.
- Annual Revenue: Approximately $19,400
- Occupancy Rate: 37%
- Average Daily Rate (ADR): $178
3. Traverse City, MI
If you're interested in a lifestyle where natural beauty meets local charm, then you should buy a lake house in Traverse City, situated in Traverse Bay on Lake Michigan.
Your mornings will start off with views of the Sleeping Bear Dunes and your days will be filled with adventures on sandy beaches or wine tours through picturesque vineyards. It offers a seamless blend of nature's tranquility and the city's vibrancy.
Downtown's boutique shops, art galleries, and eateries capture the essence of the area, while the National Cherry Festival and performances at the Interlochen Center for the Arts highlight the community spirit.
Waterfront property here connects you to the outdoors for all kinds of recreational activities, from kayaking on the Boardman River to exploring trails.
And let's not forget the simple joys, like ending a day with homemade ice cream from Moomers.
- Annual Revenue: Approximately $26,400
- Occupancy Rate: 41%
- Average Daily Rate (ADR): $291.20
4. Lake Chelan, WA
One of Washington's best lake retreats is Lake Chelan. The region is considerably drier than the state's western side due to the lake's location on the east side of the mountains, making it an excellent place to escape the Washington rain. This makes it an ideal location to invest in lakefront cabins for year-round revenue. There are vineyards and trails galore as well as a thriving foodie culture. And in the winter, a notoriously difficult period for vacation rental hosts, Echo Ridge Nordic Ski Area is less than 10 miles from Chelan and has 25 miles of groomed and backcountry tracks for snowshoers and all skill levels of cross-country, single-track, and skate skiers.
- Annual Revenue: $4,198,375
- Occupancy Rate: 49%
- Average Daily Rate (ADR): $4.8K
5. Smith Mountain Lake, VA
If you want to buy a lake house, Smith Mountain Lake isn't just an investment; it's lifestyle upgrade. The lake itself, with its serene waters and scenic surroundings, is a paradise for anyone who loves the water. Here, you can spend your days boating, paddleboarding, or fishing thanks to the abundant marinas and guided tours.
But Smith Mountain Lake offers more than just water-based fun. The area is dotted with parks where families can swim, hike, and picnic against a backdrop of natural beauty. Golf enthusiasts have their pick of scenic golf courses, while those looking for a slower pace can cruise on the Virginia Dare or sip wine at local vineyards.
The area has a ton of significant historical sites, from the D-Day Memorial to the Booker T. Washington National Monument.
In buying a lake house here, you're not just finding a home; you're embracing a lifestyle that combines the thrill of adventure with the tranquility of lakeside living and the depth of cultural exploration. Turning it into a vacation rental makes Traverse City your golden ticket.
- Annual Revenue: Approximately $45,800
- Occupancy Rate: 48%
- Average Daily Rate (ADR): $264
6. Lake Winnipesaukee, NH
The entire area of Lake Winnipesaukee is 72 square miles, so it might be best to focus your search on Gilford, Laconia, and Wolfeboro. There may be more demand and owner profits because many of the properties around the median listing price are either directly on the water or have magnificent views of the lake. With a median rental revenue of $31,518 and a 4.4% example cap rate, the area should not be overlooked.
- Annual Revenue: Approximately $48,200
- Occupancy Rate: 50%
- Average Daily Rate (ADR): $358.40
7. Lake of the Ozarks, MO
Missouri's Lake of the Ozarks is a top choice for travelers looking for a combination of entertainment, leisure, and outdoor activities.
There is an abundance of things to do and places to see because of the area's expansive waters, breathtaking scenery, and energetic community.
As far as lake towns go, Lake Ozark is a great place to buy a lake house. Vacation rentals here have the bonus of being close to a bunch of local wineries and breweries for guests to sample.
It also happens to be a golfer's paradise with a bunch of championship golf courses to choose from. You also have the famous Ozark mountains to venture toward for outings.
- Annual Revenue: Approximately $51,700
- Occupancy Rate: 53%
- Average Daily Rate (ADR): $267
Final Thoughts
There you have it, our take on where would be the best place to buy a lake house for vacation rentals.
Remember, as with any investment you should do research on the specific area, the median rental revenue, cape rate, and other vacation rental performance metrics.
Now you just need to get the property, set it up, and let iGMS help you do the rest.
