8 Best Small Towns to Buy a Vacation Home in the U.S.

Owning a vacation home has never been more popular. With many people working remotely and looking to escape the hustle and bustle of urban areas, small towns across the country are seeing an overwhelming surge in interest from out-of-towners looking to invest in a second home.

"Since the pandemic, we have seen a boom of interest in suburbs, secondary cities, and vacation markets in the U.S. and around the world," said Philip White, president and CEO of Sotheby's International Realty. "That trend has endured, and I envision buyers will continue to seek out locations that offer space, natural beauty, relaxed lifestyles, and larger properties."

According to White, the surging demand for small-town real estate is also driven by low interest rates, leading to record-breaking sales in certain regions. So what are buyers looking for?

"Many are seeking vacation homes that are lakefront or offer mountain views. Depending on their lifestyle interests, buyers are also opting to look for homes that are situated in communities that offer activities, such as skiing or golf. Watersports are also a draw and have helped boost popularity for emerging markets such as Coeur d'Alene in North Idaho," White continued.

Proximity to water — whether that's the sun-drenched, white-sand beaches of the Gulf Coast or the scenic Grand Lake in Colorado — is key. Thankfully, our country is full of charming spots that offer world-class luxuries, stunning natural attractions, and plenty of things to do.

With that in mind, these are the best small towns to buy a vacation home in the U.S. right now.

Seaside, Florida

Located along the Emerald Coast (a.k.a. the "crown jewel of Florida"), a 26-mile stretch of beaches known as 30A, Seaside was the original new urbanism town. After serving as the set for the 1998 blockbuster movie "The Truman Show," the town saw a surge in tourism that continues to this day. Its pastel-hued homes, perfectly preserved coastal architecture, postcard-worthy beaches, world-class restaurants, and shopping scene attract visitors and vacation home buyers alike.

Seaside's real estate has the highest price per square foot in 2021 of all 30A communities, breaking records across the board.

Bend, Oregon

With the highest average sunny days in the state of Oregon, no wonder this beautiful town, situated a three-hour drive south of Portland, is one of the top markets in the country for prospective vacation homeowners.

Bend (originally named Farewell Bend) is a true heaven for adrenaline-seeking enthusiasts looking to take advantage of more than 300 miles of biking trails, climbing routes, and thousands of miles worth of skiing and snowboarding trails. And of course, there are countless water sports opportunities thanks to the Deschutes River that runs through the town. Not the outdoorsy type? That's okay. The town is also home to more than 15 craft breweries and five wineries that are sure to keep you in high spirits (pun intended).

But you have to act quickly if you find a home you like. With only eight median days on the market, and a higher sale-to-list median price, real estate in Bend is sizzling hot.

Coeur d'Alene, Idaho

According to White, the lakeside town of Coeur d'Alene is not only one of the top relocation markets in the U.S., but it also offers the highest value vacation homes. In May, the town was ranked as having the fastest-rising home prices in the country. And according to Redfin, in September, home prices were 28 percent higher than last year, with 14 average days on the market compared to 32 in 2020.

So what makes this northern Idaho town so popular? Home to the state's top-rated golf course and with plenty of opportunities to practice mountain and water sports, the quaint Coeur d'Alene is the ultimate family vacation spot. Just ask Julianne Hough, who has been vacationing in Coeur d'Alene with her family since she was a child and even tied the knot in an outdoor ceremony there in 2017.

Harbor Springs and Bay Harbor, Michigan

Emmet County in Michigan has seen a surge of demand for waterfront properties since June 2020, and it's showing no signs of slowing down, according to White. "The demand is incredibly high for those looking for a second home on the water, and both towns are prime destinations for vacationers and residents alike," he said.

These serene resort communities on Lake Michigan attract visitors of all ages year-round with their charming lakeside dining and shopping spots, golfing, fishing, and sailing opportunities, as well as their overall laid-back vibe. Fall foliage here is absolutely stunning, and when the first snow transforms the area into a winter wonderland, you can try snowshoeing, cross-country skiing, and snowmobiling.

St. Augustine, Florida

The nation's oldest city really feels like an open-air museum. Its eclectic mix of architectural styles (French, Spanish, English, Gilded Age), vibrant arts community, and, of course, gorgeous beaches are why tourists can't get enough of it, and vacation home buyers want a piece of it.

Vacasa, the Portland, Oregon-based international rental management company, recently ranked the Northern Florida town second in its annual list of top vacation rental spots. According to the company, properties here have an annual gross rental revenue of $46,557, so even if you don't end up using your second home much, you can easily rent it to earn passive income.

Grand Lake, Colorado

"The Grand Lake market is incredibly popular right now and is near the entrance to the Rocky Mountain National Park, ideal for those looking for a vacation home that offers adventure and hiking," said White.

So just how "incredibly popular" is this picturesque community, located on the banks of Colorado's deepest natural lake? The luxury market in Grand County experienced a 151 percent increase in sales during the first half of 2021. And while this number is impressive, it actually dwarfs that of the town of Grand Lake, which saw a whopping 1,400 percent (no, that last zero is not a mistake) increase in the same category, according to Sotheby's Residential Luxury Report for the second quarter of 2021.

Big Sky, Montana

If you are looking to own a luxury mountain retreat with gorgeous views of the Rocky Mountains, then Big Sky is really a no-brainer. While for most people, Big Sky is mainly a winter destination for ski and snowboard enthusiasts, locals know that there's plenty to do here year-round.

Big Sky is home to the exclusive, celebrity-studded The Yellowstone Club as well as several ski and golf communities that have put the real estate market here in a league of its own.

According to Rockethomes.com, the median listing home price for September 2021 rose almost 22 percent to $1.4 million since last year.

Wailea, Hawaii

It's not hard to convince travelers that making this stunning Maui town their permanent vacation spot is a good idea. With five beaches, including the Ahihi-Kinau Natural Area Reserve, numerous snorkeling outports, hiking trails, world-class golf courses, and luxury resorts, buying a property in Wailea is an appealing investment.

The downside is that you have to be prepared to act fast and offer above asking price, because the market here is red hot right now. As of September, the average cost of the homes sold was $3,691,505, which is a 55 percent increase compared to last year, according to MauiRealEstate.com. The most popular neighborhoods in town for newcomers are Wailea Pualani and Wailea Kai.