If you own a vacation home near the parks, the last couple of years have probably tested your patience. Homes are taking longer to sell, and buyers are asking harder questions about rental income before they commit. Many owners are deciding whether to sell now or wait. Few of them have heard that a recent change in federal tax law has made these homes far more appealing to a specific group of buyers, and that change helps people on both sides of the sale.
What the One Big Beautiful Bill Changed
Bonus depreciation lets an investor deduct the full cost of certain property in the year it goes into service instead of spreading the deduction over many years. It had been phasing down since 2023, dropping to 80% that year and 60% in 2024, and it was on track to disappear. The One Big Beautiful Bill Act, signed in July 2025, restored it to 100% and made it permanent for qualifying property acquired after January 19, 2025.
How Cost Segregation Fits In
A residential rental is normally depreciated over 27.5 years. A cost segregation study, prepared by an engineering or specialty tax firm, breaks the property into its individual parts and gives shorter recovery periods to the parts that qualify. Furniture and appliances usually fall into the five-year category. Pools, decks and landscaping typically fall into the fifteen-year category. Anything with a recovery period of twenty years or less qualifies for bonus depreciation, so those parts can now be deducted in the first year.
Homes in our resort communities are especially well suited to this approach because they sell fully furnished and most come with a private pool and outdoor living space.
Why Short-Term Rentals Get Different Treatment
Rental losses are usually passive, which means they can only offset other passive income. Short-term rentals follow a separate rule. When the average guest stay is seven days or less and the owner materially participates in running the rental, the losses can offset wages and business income. Families visiting the theme parks tend to book a week or less, so most homes here meet the stay requirement without changing how they operate.
What This Means for Buyers
If you earn a high income and have been thinking about a vacation home, a cost segregation study can produce a first-year deduction that lowers your tax bill noticeably. The property still earns rental income and stays available for your own family trips. Some investors put those savings toward upgrades, and others hold them for a second property.
Before you buy, sit down with a CPA to confirm that your purchase timing qualifies and that you can meet the material participation hours, which depend partly on how you set up management. Your CPA should also walk you through depreciation recapture, because part of the deduction you take now may be taxed when you sell.
What This Means for Sellers
Selling a vacation home has been hard on many owners lately, particularly those who watched carrying costs rise while booking income leveled off. If that sounds like your situation, the new law gives you a reason to look at your timing again. It has drawn high-income professionals and business owners into our market who are specifically looking for furnished, rental-ready homes, and they value your contents and booking history more than a typical second-home buyer would.
That should shape how your home is marketed. To these buyers, your furniture package is an asset they can depreciate, and documented rental income gives their CPA grounds to recommend the purchase. A listing written for these buyers and their advisors will reach people that a conventional vacation home listing misses.
Local Expert Insight
I've been selling vacation homes in the Central Florida resort corridor for more than twenty years. The investors who do well here choose the property first and treat the tax benefit as an added advantage. Most of the deduction is used up in year one, and after that the community's zoning, its HOA and guest demand decide how the home performs for the next decade. I can show you which communities allow short-term rentals and how each resort's amenities affect bookings, so the property holds up long after the first tax return.
Many owners here use full-service management companies, and that setup can make the material participation test harder to meet. Settle it with your CPA before closing so your management structure supports the tax plan you're counting on.
I'm a real estate broker, not a tax advisor. Please review any tax strategy with your CPA before acting on it.
Thinking About Buying or Selling?
Buyers: If you'd like a vacation home that earns income and reduces your tax bill, message me and we'll talk through what you're looking for. I'll help you find a home in a community with the rental demand to support it, and I can introduce you to CPAs and cost segregation firms who know this market well.
Sellers: If you've been unsure about the right time to sell, the buyer pool for your home may be larger than you think. Request a no-obligation valuation at mattdixonrealestate.com/selling-your-vacation-home and I'll show you how I would present your home to today's investor buyers.
