Every summer bucket list includes a beach house. But if you hope to graduate from renting a sandy retreat for the week to outright owning a home by the sea, can you afford it? Realtor.com’s affordable beach towns rankings prove you absolutely can—if you know where to look.
The very best beach town for bikini-slim budgets is Pascagoula, MS, a Gulf Shore escape where the typical listing will run you a mere $165,610. Not bad, right? In fact, 11 of the 12 picks on the list boast asking prices below the national median of $431,250.
- Pascagoula, MS: $165,610
- Deerfield Beach, FL: $211,750
- Atlantic City, NJ: $242,450
- Port Richey, FL: $254,925
- Port Lavaca, TX: $292,000
- Myrtle Beach, SC: $299,000
- Ocean Springs, MS: $302,500
- Corpus Christi, TX: $310,000
- Surfside Beach, SC: $310,925
- Long Beach, WA: $403,188
- Ocean Shores, WA: $409,900
- Ocean City, MD: $454,500
But… buying the house is just the start. Rising insurance and maintenance costs have forced many investors to question whether beach homes are too big a gamble.
“Beach homes used to be a cakewalk, but now it’s a whole different ball game,” says Levi Rodgers, a retired Green Beret and real estate broker in San Antonio. “My property on the Gulf went from $3,200 a year for insurance to over $11K, and that’s if you can even get coverage without bizarre exclusions. Throw in new flood zone redeterminations and wild HOA fee hikes, and your profits are wiped out in an instant.”
“Honestly, coastal property makes me more nervous than my first million-dollar listing, despite loving beachfront real estate,” agrees Los Angeles real estate agent Wesley Kang. “I’ve seen changes that would shock most investors. Insurance costs broke another record at my Marina del Rey listing yesterday. The owner just got hit with a $68K annual premium, up from $15K last year, while his neighbor two blocks inland pays $7K.”
In addition to hurricanes, slow-and-steady beach erosion has caused some homes to simply collapse.
“My Malibu client just spent his entire summer rental income on mandatory seawall repairs,” says Kang. “Another had to install $100K worth of water barriers just to keep his insurance.”
Is a beach home a good investment?
Although owning a beach home isn’t the easy, dreamy investment that perhaps it used to be, some investors still think it’s worth it—with some changes to their strategy.
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“I haven’t sold yet. I just had to adapt,” says Rodgers. “I cut the rental period down to high-season months, raised rates by 22%, ended low-season bookings, and promoted high-end upgrades to make it work. You have to run it like a hospitality business now, not a passive rental. The ROI is still there, but only if you are actively managing risk, costs, and guest experience. Otherwise, you’re just financing someone else’s vacation.”
“Beach properties are now riskier,” agrees Idaho-based real estate investor Daniel Roberts, who has reinvented his approach to stay solvent. “We improved our rental by presenting the property as a luxury destination, adding concierge services with dining, boat tours, and fitness sessions,” he says. “With this rental arrangement, we earned 18% more on rental income last year compared to the previous year. However, our profits have decreased a little since we now pay more each month for maintenance and insurance.”
If you’re shopping for a beach house and hoping for a deal, it may pay to search a bit inland for cheaper properties and insurance rates. Elevation is also your friend. “My elevated properties keep attracting loads of cash because people finally understand storm surge math,” says King.
Certain oceanfront areas are also experiencing a steep drop in prices—like Florida.
“It’s a great time to buy if you’re looking for opportunities as an investor in areas like Florida, which saw a huge run-up of people heading there during the pandemic, but their jobs have required them to return to the office,” says Florida real estate agent Cara Ameer. “If you’re in the market for a vacation property that you can rent out and possibly use as a second home, there are an abundance of choices.”
Bottom line: Beach home bargains can still be found as long as you check the fine print, so don’t be afraid to slap on some sunscreen and shop around.