Villa Alcaeus for sale in Paros, Greece

Savvy investors seeking out second homes are searching for real estate in corners of the world where properties are easy to rent out. Providing vacation opportunities and passive income across the remainder of the year, these residences also have the potential to increase in value.

If you’re looking for an island destination that offers a laid-back lifestyle, luxurious real estate listings, and a stable tourist stream, consider this recent survey by Travel + Leisure.

As part of their World’s Best Awards, the leading travel source highlights a selection of appealing getaways.

They asked readers to rank travel experiences around the globe, sharing their opinions on the top islands. People rated destinations according to activities and sights, natural attractions and beaches, friendliness, and overall value.

Benefits of the most popular islands for a second home

From Bali in Indonesia and Maui in Hawaii to Madeira in Portugal and Crete in Greece, the unspoiled isles revealed in Travel + Leisure’s survey boast well-developed infrastructure and amenities and picturesque landscapes, including white-sand beaches, quaint villages, scenic golf courses, and top-class restaurants.

By owning a second home in a widely-visited tourist destination, you’ll have a perfect vacation spot and could also earn meaningful rental return on investment (ROI). To find out more about potential ROI, we recommend contacting a local real estate agent – the best source to provide precise information.

Top 8 idyllic islands to buy a holiday home

Below, we’ve selected eight of Travel + Leisure’s most highly-ranked isles, from the Azores in Portugal to Ischia in Italy. To estimate the “value” of each location, we used approximate population and annual tourist figures, plus average house prices.

1. Ischia, Italy

Population: 18,510

Annual number of tourists: 6 million

Average housing price on JamesEdition: $2,722,000

Nestled in the Gulf of Naples just 45 minutes from the mainland is Ischia, a charming volcanic hotspot with pristine beaches, including Maronti and Le Fumarole, with its geothermally heated sand. The paradise island also offers an authentic taste of Italy and is known for its welcoming locals. There are no restrictions on foreign ownership in Italy, but transaction costs are moderate to high. Moreover, the legalities regarding freehold and leasehold properties are often complex, so appropriate professional advice is recommended.

2. Bali, Indonesia

Population: 4.2 million

Annual number of tourists: 6.2 million

Average housing price in Indonesia, on JamesEdition: $1,220,000

Offering picturesque natural beauty, a rich culture, and a diverse range of outdoor activities like surfing, diving, and hiking, Bali boasts a laid-back way of life. White-sand beaches dot the coast, while inland, temples and rice terraces pepper the landscape. Buying real estate as a foreigner is simpler than in previous decades. Today, it’s possible to lease a residence on a long-term basis, subject to certain conditions. Additional considerations include the annual property tax, plus income levies if you rent the house out.

3. Phuket, Thailand

Population: 443,679

Annual number of tourists: 9.29 million

Average housing price on JamesEdition: $1,967,000

This tropical utopia is quickly becoming one of the world’s leading luxury destinations. Why? It offers peace, tranquility, and glorious natural scenery, plus excellent health, education, and leisure facilities. Popular investment areas include Kata, Karon, Mueang, Patong, Bang Tao, and Surin. Foreigners can only buy a villa or a larger property on a leasehold basis, but they can own an apartment freehold. Most costs are paid by the seller, with the purchaser responsible for transfer and legal fees.

A new proposal was recently announced, and if approved, it will pave the way for foreigners to own land outright. However, the plan only applies to Bangkok and Pattaya, with a minimum investment of THB 40 million (approximately $1 million).

4. Paros, Greece

Population: 12,500

Average housing price on JamesEdition: $1,787,000

Part of the Cyclades archipelago in the Aegean Sea, Paros is a sun-kissed island that’s popular among yacht owners and windsurfers. Home to golden beaches and a Venetian Fortress, other highlights include the authentic and cobbled streets of the “old port” that blend seamlessly with modern amenities. Paros’ bougainvillea-laden towns are full of cultural appeal, with attractions such as Panagia Katapolian, a Byzantine church dating back to 326 AD. EU residents have almost no restrictions on purchasing property in Greece, while non-EU citizens may need to prove connections to the country and how they intend to use the dwelling. Meanwhile, since Brexit, UK natives may face more barriers and increased admin. Fees range from agency and notary to lawyer and public registration.

5. Ibiza, Spain

Population: 160,000

Annual number of tourists: 3.54 million

Average housing price on JamesEdition: $2,600,000

There’s so much more to Ibiza than its bustling nightlife, ranging from the natural beauty of Ses Salines to UNESCO-designated Dalt Vila Old Town. The island is home to a handful of tech-forward marinas such as Eivissa, Botafoch, and Santa Eulalia, and activities like biking, hiking, and horse riding are popular. Residents savor the slow pace of life in traditional villages like Sant Josep de sa Talaia, and there’s a tight, cosmopolitan community across the isle. In terms of buying real estate, there are no restrictions or special requirements for foreigners. Extra costs include VAT on new builds and property transfer tax, plus legal, notary, and estate agency fees.

6. Madeira, Portugal

Population: 251,060

Annual number of tourists: 3.1 million

Average housing price on JamesEdition: $813,000

Madeira is an archipelago where just two of the islands are inhabited, both of which boast fabulous scenery. Located around 1000 kilometers from mainland Europe and 500 from Africa, the subtropical region is known for hiking, lava pools, and world-class wineries. Cosmopolitan Funchal has boomed in recent years as it’s become more developed. A place for explorers, there’s UNESCO-designated Laurissilva Forest to discover, plus year-round snorkeling, diving, sailing, surfing, windsurfing, and fishing to enjoy. As mentioned above, buying real estate as a foreigner in Portugal is straightforward; outgoings to account for include the variable property transfer tax, plus notary costs, land registry fees, and stamp duty.

7. Maui, Hawaii

Population: 166,740

Annual number of tourists: 3.06 million

Average housing price on JamesEdition: $2,195,000

With diverse scenery spanning lush rainforests, sprawling beaches, and volcanoes, Maui is a haven for surfing, hiking, snorkeling, scuba diving, and kiteboarding. This majestic island in the Pacific Ocean is also the ultimate destination for nature lovers. Golf is popular too, with courses such as Kapalua Plantation, Makena, and Wailea rated highly. Foreigners can buy real estate in Hawaii for investment purposes or as a vacation home; all-cash is the most straightforward way to proceed. Closing costs are generally between 0.96% and 1.12% of the purchase price, and be sure to take the special Foreign Investment in Real Property Tax Act (FIRPTA) into account.

8. Crete, Greece

Population: 670,000

Annual number of tourists: 5.3 million

Average housing price on JamesEdition: $1,083,000

This is the largest Greek island, yet Crete takes life at a relatively slow pace. More relaxed than the mainland, the lifestyle is healthy and active – ideal for those seeking to embrace the great outdoors. The varied landscape spans mountains covered in tiny villages, larger towns like Heraklion and Chania, and unspoiled beaches such as Myrtos, Falasarna, and Elafonissi, famous for its pink-tinted sand. As previously mentioned, EU nationals have few restrictions on purchasing property in Greece. Non-EU citizens may need to prove how they intend to use the residence, and UK citizens may face increased barriers and admin. Fees include estate agency, lawyer, notary, and public registration.

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