Second Homes & Investment Properties: Is Now the Time to Buy?

Second Homes & Investment Properties: Is Now the Time to Buy?

Many clients are asking the same question right now — is it a good time to buy a second home or investment property in Colorado?

At Highlands Property Group, we believe the answer depends on your goals, timing, and financial outlook. Whether you’re dreaming of a peaceful mountain getaway or seeking an income-producing asset in Denver’s growing market, owning a second property can be both a lifestyle upgrade and a smart long-term investment.

Let’s explore what’s happening in today’s market and why now might still be the right moment to act.

Lifestyle Upgrade or Long-Term Investment? Why Not Both?

A second home represents flexibility, stability, and opportunity. It can serve as a personal retreat and an appreciating asset at the same time.

In Colorado markets such as Vail, Beaver Creek, Breckenridge, and Denver, second homes are more than luxury escapes — they are tangible, income-producing assets.

📈 According to AirDNA, Colorado remains one of the top five states for vacation rental performance in 2025, with average occupancy rates near 64% and average daily rates up 3.2% year-over-year.

That means your second home can not only enhance your lifestyle but also generate passive income through short-term rentals, seasonal stays, or long-term tenants.

The Short-Term Rental Market Remains Strong

Despite tighter regulations in some municipalities, Colorado’s short-term rental (STR) market continues to perform well — particularly in desirable destinations with year-round appeal.

Travelers are prioritizing privacy, unique design, and local experiences, creating strong demand for high-quality, well-managed rental properties.

💡 In 2024, Colorado vacation rentals generated an average gross revenue of $54,000 per year, with top-tier properties exceeding $120,000, according to AirDNA data.

At Highlands Property Group, we help our clients evaluate:

• Local STR regulations and licensing requirements

• Seasonality and projected occupancy rates

• Property management and maintenance options

• Expected rental yield and tax implications

Our goal is to help you invest with clarity and confidence — not guesswork.

Why Real Estate Still Outperforms as an Investment

Many investors are rebalancing their portfolios in 2025 as the markets adjust to new interest rate environments. Real estate remains a proven hedge against inflation and market volatility, providing both income and appreciation.

📊 According to CoreLogic, U.S. home values increased by an average of 5.2% year-over-year as of May 2025, outpacing inflation and most fixed-income investments.

Even with modest appreciation, Colorado’s long-term fundamentals remain strong:

• A diverse and resilient job market

• Consistent population growth in Denver and mountain towns

• Limited housing supply in desirable neighborhoods

• Year-round tourism and rental demand

Owning an investment property in Colorado is not just about today’s value — it’s about long-term wealth preservation and portfolio diversification.

What Makes a Great Second Home or Investment Property?

When helping clients identify second-home or investment opportunities, we focus on three key criteria:

1. Year-Round Appeal

The best investments perform across all seasons. Properties near outdoor recreation, shopping, or cultural attractions — such as Sloan’s Lake, LoHi, or downtown Golden — tend to have more consistent rental demand.

2. Low-Maintenance Luxury

Turnkey or recently renovated homes reduce management burdens, particularly if you’re not local. Buyers often look for properties with modern systems, updated finishes, and energy-efficient upgrades.

3. Smart Appreciation Potential

In Denver, submarkets such as Jefferson Park, Sunnyside, and Baker are seeing above-average appreciation due to revitalization and new development. We use data-driven neighborhood analysis to help clients pinpoint high-growth pockets with strong resale potential.

Let’s Talk Numbers — Without Getting Lost in the Spreadsheets

At Highlands Property Group, we understand that buying a second home is both a financial and emotional decision. We help clients evaluate:

• Projected rental income and ROI

• Tax benefits, including depreciation and mortgage interest deductions

• Financing options, such as using existing home equity for down payments

• Exit strategies for resale or 1031 exchange opportunities

💡 According to Roofstock, the average annual return for long-term rental properties in Denver is between 7% and 10%, depending on leverage and management approach.

Our approach blends detailed financial modeling with personalized strategy so that each purchase aligns with your goals — whether cash flow, appreciation, or lifestyle freedom.

Why Colorado? Why Now?

Colorado continues to attract high-net-worth individuals seeking both quality of life and financial growth. From luxury condos in Denver to mountain homes in Summit County, buyers are prioritizing wellness, recreation, and smart asset placement.

📈 Zillow’s 2025 forecast projects steady appreciation of 2–3% annually across Colorado’s major metros, with Denver’s luxury segment expected to outperform due to limited inventory and high demand.

Beyond returns, there’s something deeply grounding about owning real property — a fireplace to gather around, a mountain view to wake up to, or an asset that works quietly while you’re not there.

Let’s Explore What’s Next

At Highlands Property Group, we combine deep market knowledge, financial acumen, and an investor’s mindset to help clients make wise real estate decisions. Whether you’re exploring a mountain retreat, a downtown condo, or a high-yield rental, we help you find opportunities that balance performance with peace of mind.

📩 Ready to explore second-home or investment opportunities?

Contact Highlands Property Group to schedule a consultation or request a custom investment property analysis.