As tourism drives the economy of the Outer Banks, it also plays an important role in driving the local real estate market. For those Outer Banks home owners who rely on rental income, the state of tourism can become even more important. Over the last several years, we saw tourism continue to grow.
A recent report from VisitNC research site shows tourism spending on the Outer Banks broke 1 billion for the second consecutive year. There were some early reports during the year, that tourism looked to be off for the OBX, but as the Outer Banks reports it looks like we could have another record year for tourism:
Last week, new data showed visitation at the state’s natural and cultural sites for Fiscal Year 2015-16 that ended June 30 was up 7.7 percent compared to the previous year.
In addition, the 11.7 million visitors to the North Carolina State Parks system through the end of July is a 10 percent increase over midsummer visitation in 2015, the state said.
Total state parks visitation in 2015 was a record 17.3 million. If the trend continues through the end of 2016, that record is likely to be surpassed.
Does the possibility of another record year for tourism continue to make Outer Banks real estate a good investment?
We tend to think it will as we haven’t met many people who have been here and then didn’t want to come back. As new vacationers come back year over year, the area continues to grow for weddings as does the popularity of off-season events like the Outer Banks Seafood Festival, outerbanksseafoodfestival.org.
The continued growth of tourism also contributed to a critical mass of enough vacationers to support improvements like the new water park in Currituck County to the First Flight Adventure Park, www.firstflightadventurepark.com, in Nags Head. Along with these major improvements to the area, we also could see a growth in the need for commercial properties like restaurants and hotels.
The fact that we could see another good year for tourism, along with the continued decline in the number of available Outer Banks foreclosures, should translate into strong investment numbers for real estate along the Outer Banks.
Depending on price range we often see homes with capitalization rates as high as 12%, we imagine as more people come to realize the benefits of owning property, could mean real estate investment continues to grow.
In the short-term it is worthwhile to ask the question that does the continued low interest rates, coupled with another potential record year for tourism make Fall of 2016 a great time to find a vacation or investment home on the Outer Banks?