10 Real Estate Markets That Could Become Vacation Rental Havens

The vacation rental market is booming due to the pent-up demand for travel and the desire for more space and unique accommodations. Those who don't want to compete in the hottest (but highly saturated) vacation rental markets across the United States may want to consider these up-and-coming destinations that could become vacation rental havens in the near future.

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According to a recent report from VRBO, Expedia Group's worldwide vacation rental business, Cincinnati, Ohio, ranked No. 1 for the highest increase in year-over-year demand for vacation rental properties. This summer, demand has jumped nearly 125%.

Cincinnati's proximity to several Midwestern cities, like Chicago, Indianapolis, and Louisville, makes it an easy place to get away and enjoy a new city.

A short drive from Richmond and Norfolk, Virginia, the historic area of Yorktown, Virginia, is regaining notoriety as a hot spot for vacationers. Home to several important Civil War sites and museums -- as well as one of the original shires formed in colonial Virginia in 1682 -- the small town ranked No. 2 on VRBO's list for up-and-coming vacation destinations.

Small-town vibes with bigger-city offerings, Harrisburg, Pennsylvania, is quickly becoming a top destination for vacation getaways. It has a bit of something for everyone -- farms, rolling hills with forest, breweries, restaurants, history, and chocolate! This city is home to Hersheyland and even has an interactive chocolate museum to enjoy.

ALSO READ: 5 Explosive Vacation Rental Markets to Tap Into Before Summer

Alaska's harsh, rugged winters make it a tough place to own a rental property, but Matanuska-Susitna may be a worthwhile investment spot for those tough-skinned investors. Near Denali National Park, the area was fifth on the list for VRBO's up-and-coming destinations, with a notable uptick in demand for vacation rentals this summer.

Chattanooga, Tennessee, is one of the state's four biggest metro markets and has a lot of the same city offerings travelers expect and want from Nashville, but on a much smaller scale. The city is just along the Georgia border, not far from popular activities in Ocoee National Forest, with several unique tourist attractions of its own.

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Walton Beach has been at the top of the list for VRBO and Airbnb in terms of rental demand this summer. One of the largest counties in Florida and bordering Georgia on Florida's panhandle, this area has 26 miles of coastline on Florida's up-and-coming Emerald Coast. Miramar Beach and Rosemary Beach are popular summer spots; however, any beach spot in the county would likely do.

The popular and powerful natural wonder Niagara Falls has garnered visitors for over a century. However, being outshined by other vacation destinations over the last few decades, it lost a bit of its luster. According to Airbnb, though, Niagara Falls is making a comeback. This city marked one of the fastest-growing rental destinations for summer 2022.

The wine region neighboring Niagara, called Niagara on the Lake, continues to be a popular and competitive market for vacation rentals. However, there are still rental opportunities on the outskirts.

This unassuming rural town in the middle of the Washington forest has become quite the popular vacation spot for those wanting to unplug and get away. It's the perfect spot to explore some of Washington's most popular beaches, Olympic National Park, and some of the filming sites for the famous Twilight series. This is a very small town with just a few hotels and motels, making it an ideal spot to create a unique vacation rental experience.

ALSO READ: 10 Laws to Know Before Investing in a Vacation Rental

This coastal city has all the Northeastern charm you'd expect for a vacation town. Connecticut has become a popular vacation spot since the onset of the pandemic. Its proximity to New York City made it the ideal long-term getaway for those working from home. Stonington, Connecticut, in particular, was at the top of the list for Airbnb, with a large demand for summer rental bookings.

The area surrounding Crystal River has much of the Old Florida charm visitors want from a visit to Florida. Oak trees, alligators, picturesque river lines, manatees, summer scalloping -- there's something for everyone to enjoy. The city's affordable home prices and steady demand throughout every season make it an attractive place to own a vacation rental.

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No matter where your property is located -- whether rural, urban, or suburban -- amenities and unique offerings seem to matter most for vacation rentals today. Whether your property is a tree house, yurt, condo, or award-winning architectural build, find a way that stands out from the rest and make the stay an experience in and of itself.

By focusing on these features and targeting off-the-beaten places like these 10 up-and-coming vacation rental markets, you may be able to beat out the competition and score a cash cow rental property.

Liz Brumer-Smith has positions in Airbnb, Inc. The Motley Fool has positions in and recommends Airbnb, Inc. The Motley Fool has a disclosure policy.