Half my time is spent on the road—scouting for undervalued real estate opportunities. The top places on my radar right now are in fast-emerging beach destinations. In each place I visit, I study how much income you could make if you made your beach home available for rental when you aren’t using it.
These are my top three picks for this strategy:
1. Ecuador’s North Coast
Ecuador’s north coast would be a great place to have a beach home. It’s a great place to spend time…feet dangling in your pool, face in the bright sun and warm breezes…long strolls on the beach at sunset.
This is one of the nicest stretches of Pacific coast you will find. Yet it stayed undiscovered because it was difficult to get to. A new road from Quito has dramatically changed that. You can buy a luxury beach home in a gated community for $135,000. Or a lot for $31,000.
And you can generate a strong income. On my last trip, I visited a home that grossed $3,800 in rent last December. Not bad considering the owner bought it for $180,000. That’s a gross yield of 2.1% in December alone. And the value of his home is rising.
2. Tulum, Mexico
Tulum in Mexico is a pristine, unspoiled paradise. It’s home to a protected biosphere, ancient Mayan ruins and green jungle. Here you’ll find some of the world’s finest white-powder beaches.
But unlike other parts of the Caribbean, this comes without the serious sticker shock. You could buy a five-acre jungle lot for $80,000…or a condo in a high-end community from around $182,000.
Just 80 miles from Cancun, Tulum has stayed off the radar, attracting a chic and trendy set looking to escape the crowded resorts.
There is a government plan (backed by infrastructure developments) to increase tourist number along this stretch of coast from 3 million to 11 million by 2020. The series of highway bypasses at Playa del Carmen now reduce driving time from Cancun airport to 75 minutes. Development here will be boutique and high-end.
Demand for rentals is already strong. It’s set to get stronger as more visitors come. Because of the scarcity of developable land, new construction will be limited.
3. Las Terrenas, Dominican Republic
Located on the Dominican Republic’s Samana peninsula, this is a little piece of paradise. Nineteen miles of walkable public beach, palm trees, warm breezes and stars so bright it feels like you could pluck them from the sky… I can’t think of a nicer place to have a beach home. You’ll find your dollars stretch here, too.
For $165,000 you can buy a luxury 1,700-square-foot townhouse in a new gated community on the edge of town.
And there are few better places to earn an income from a beach property. One home I visited nets the owner $25,000 a year and lists for $285,000 (an 8.8% yield). Plus, he still uses it as vacation home.
An excellent new road means that the capital Santa Domingo is now less than two hours away. Flights come from North America to the El Catey airport 25 minutes from town.
Editor’s note: These three areas will feature at the upcoming International Real Estate Investment Forum in June. Also present will be Ronan McMahon (director of Pathfinder, IL’s preferred real estate advertiser), his invited contacts and a series of “off market” deals for property in each area mentioned above—at prices and terms not publicly available. Secure your place in the room here.