Condotels continue to carve out their unique position in the 2025 real estate landscape. These hybrid properties, part condominium, part hotel, present distinctive opportunities for both investors and vacation home buyers, as tourism continues to grow steadily in key leisure destinations across the country. Condotel hot markets like Florida, Nevada, and coastal California are experiencing increased demand as buyers seek to capitalize on the short-term rental potential and lifestyle appeal.
For brokers navigating this specialized market, staying current on regional trends and financing options has become increasingly important. This industry update explores the hottest condotel markets of 2025 and identifies which borrower profiles stand to benefit most from specialized financing programs like LendSure’s Condotel Loan option.
TOP CONDOTEL MARKETS SHOWING STRONG PERFORMANCE IN 2025
According to recent market analysis from AirDNA and STR Scout, several regions are demonstrating particularly robust performance for condotel properties this year:
Myrtle Beach, South Carolina – Continuing its strong performance with year-round appeal and relatively affordable entry points compared to other coastal markets.
Orlando and Fort Lauderdale, Florida – Both are maintaining steady demand driven by tourism, with Fort Lauderdale seeing increased interest from buyers seeking alternatives to more saturated Miami properties.
Scottsdale, Arizona – Attractive for its combination of luxury amenities, outdoor recreation, and growing appeal as a destination for remote workers.
Gatlinburg, Tennessee – The gateway to the Great Smoky Mountains National Park remains a consistently strong performer for short-term rentals.
Kissimmee, Florida – Benefiting from proximity to Orlando’s attractions while often offering more competitive pricing.
Park City, Utah – Premium winter destination that has successfully expanded its appeal to year-round activities.
Lake Havasu City, Arizona – Growing in popularity for its water recreation opportunities and relatively accessible price points.
What makes these markets noteworthy isn’t simply their tourism appeal but their combination of factors: consistent occupancy patterns, relative affordability compared to prime coastal markets, and diversified demand drivers that help buffer against seasonal fluctuations.
CURRENT BORROWER PROFILES IN THE CONDOTEL MARKET
The typical condotel buyer in 2025 spans several distinct categories, each with different financing needs and investment goals:
Investment-Focused Buyers – Often experienced real estate investors looking to diversify their portfolios with short-term rental properties that offer potential for both appreciation and income.
Semi-Retired Professionals – Buyers who split their time between multiple locations and want their vacation property to generate income when not in use.
Remote Work Adapters – A growing segment of professionals who can work from multiple locations and seek properties that function as both part-time residences and income-generators.
Foreign National Investors – International buyers interested in U.S. vacation properties, particularly in markets with established tourism infrastructure.
First-Time Vacation Property Buyers – Often seeking more affordable entry points into vacation ownership, with rental income helping offset carrying costs.
These diverse borrower profiles often encounter friction with traditional financing channels, which tend to apply rigid guidelines to condotel properties based on their commercial characteristics or non-warrantable status.
FINANCING CHALLENGES IN THE CONDOTEL SECTOR
Condotels typically face financing hurdles for several reasons:
- Classification as mixed-use or commercial properties by traditional lenders
- Non-warrantable status that falls outside conventional lending guidelines
- Hotel-like amenities or rental programs that trigger restrictive underwriting
- Management structures that don’t align with standard residential lending criteria
For brokers, these challenges have historically meant limited options for clients interested in condotel properties. However, specialized non-QM lenders have developed programs specifically designed for this market segment.
LENDSURE’S APPROACH TO CONDOTEL LENDING IN 2025
LendSure’s Condotel Loan Program addresses the common financing obstacles that brokers encounter when working with condotel buyers. Key program features include:
- Loan amounts up to $3 million
- Financing options up to 75% LTV for purchases
- Flexibility for primary, second home, or investment use
- Eligibility for foreign national borrowers
- No condo questionnaire requirement
This approach helps brokers work with clients who might otherwise be turned away by conventional financing sources, particularly in the hot markets identified above.
MARKET CONSIDERATIONS FOR BROKERS
When advising clients on condotel properties in 2025, several market-specific factors warrant consideration:
Seasonality Variations – While the top markets show strong annual performance, many still experience seasonal fluctuations that affect rental income projections.
Local Regulations – Short-term rental regulations continue evolving in many markets, potentially impacting future rental possibilities.
Management Options – Properties with established management programs may offer convenience, but they come with higher fees that can affect investment returns.
Building Amenities and Fees – Higher-end properties with extensive amenities generally command better rental rates but also carry higher HOA fees.
Successful brokers in this space develop expertise not just in the financing options but also in the practical considerations that impact long-term investment performance.
LEVERAGING MARKET KNOWLEDGE
For brokers looking to capitalize on the condotel market in 2025, developing specialized knowledge becomes a competitive advantage. Consider these approaches:
- Cultivate relationships with real estate agents in top condotel markets
- Develop educational resources that highlight financing solutions for these property types
- Create targeted marketing that speaks directly to the distinct borrower profiles
- Stay informed about seasonal trends and occupancy data in key vacation markets
CAPTURING THE CONDOTEL OPPORTUNITY IN 2025
The condotel sector continues to demonstrate resilience in 2025, with a particularly strong performance in the markets highlighted above. For brokers serving clients interested in these properties, understanding both the regional market dynamics and the specialized financing options available through programs like LendSure’s provides a significant advantage.
While conventional financing channels may continue to approach condotels with caution, non-QM lenders offer viable alternatives that open opportunities for various borrower profiles in this growing market segment.
For more information about LendSure’s Condotel Loan Program or to discuss specific client scenarios, contact our team today.
THE LENDSURE WAY
It’s simple. We make loans that make sense. We’re not in-the-box lenders. Of course, there are numbers ratios, and data to consider, but we know that behind every file, there’s an individual with a unique circumstance seeking a loan. We work hard to offer our common-sense take on lending to borrowers seeking funding for the home of their dreams, another addition to their investment property portfolio, or refinancing of a currently-owned property.
Are you ready to benefit from a commonsense approach to lending? Contact us today to learn more about non-QM loans and how partnering with https://lendsure.com/ can help grow your bottom line.
