The Most Profitable Places to Own a Short-Term Rental – The New York Times

3 minutes, 45 seconds Read

The housing market remains tight, but the price of entry is surprisingly low in many profitable vacation areas.

Finding a home has been so difficult lately. Is it worth buying one as a short-term rental? Yes — but not everywhere — suggests a report from AirDNA.


Buy/sell, rent/lease residential &
commercials real estate properties.

Revenues for short-term rentals faded in 2023 after two years of intense growth, but researchers at AirDNA expect those revenues to grow again in 2024. To locate the 25 best places in the country to buy a short-term rental, they created an “updated index” of Airbnb and Vrbo rental data for full single-family homes (the source of this week’s chart).

What may surprise you is that vacation homes in profitable areas are not always expensive. The typical home price (derived from the Zillow Home Value Index in December 2023) was found to be about $160,000 or less in two of the 25 areas on the list; under $250,000 in seven; and under December’s national median home price (roughly $418,000) in 17.

“A big piece of this is the big run-up of home values in the more traditional vacation rental markets that were also very attractive for people to live and work remotely during the pandemic,” said Jamie Lane, chief economist at AirDNA. In other words, higher demand in the most coveted vacation areas drove up home prices, cutting into rental profits.

As a result, he said, smaller cities “where we haven’t seen this much home-value appreciation” are reaping higher profits from short-term rentals.

Indeed, pricey areas that are popular as second-home and vacation destinations — Mr. Lane cited Joshua Tree, Calif., Breckenridge, Colo., and California’s Coachella Valley as examples — are conspicuously absent from this year’s list.

The study only considered markets with 500 or more listings. Areas with laws prohibiting short-term rentals were also omitted. To rank each market, 2023 rental demand and revenue growth since 2022 made up half of the score; the other half was based on an “investability” score largely derived by comparing typical home values relative to potential short-term rental profits.

Profitable Vacation Homes

The 25 cities best for investing in a short-term rental and the typical home price in each. Rankings were based on an AirDNA analysis of profits relative to home values, annual revenue growth and rental demand.

#g-15calculator-box ,
#g-15calculator-box .g-artboard {
margin:0 auto;
}
#g-15calculator-box p {
margin:0;
}
#g-15calculator-box .g-aiAbs {
position:absolute;
}
#g-15calculator-box .g-aiImg {
position:absolute;
top:0;
display:block;
width:100% !important;
}
#g-15calculator-box .g-aiSymbol {
position: absolute;
box-sizing: border-box;
}
#g-15calculator-box .g-aiPointText p { white-space: nowrap; }
#g-15calculator-Artboard_1_copy {
position:relative;
overflow:hidden;
}
#g-15calculator-Artboard_1_copy p {
font-family:nyt-franklin,arial,helvetica,sans-serif;
font-weight:300;
line-height:41px;
height:auto;
opacity:1;
letter-spacing:0em;
font-size:16px;
text-align:left;
color:rgb(0,0,0);
top:1.3px;
position:static;
text-transform:none;
padding-bottom:0;
padding-top:0;
mix-blend-mode:normal;
font-style:normal;
}
#g-15calculator-Artboard_1_copy .g-pstyle0 {
line-height:13px;
height:13px;
font-size:12px;
top:1px;
position:relative;
}
#g-15calculator-Artboard_1_copy .g-pstyle1 {
line-height:12px;
height:12px;
font-size:12px;
top:1px;
position:relative;
}
#g-15calculator-Artboard_1_copy .g-pstyle2 {
font-weight:700;
height:41px;
text-align:right;
position:relative;
}
#g-15calculator-Artboard_1_copy .g-pstyle3 {
font-weight:700;
height:41px;
position:relative;
}
#g-15calculator-Artboard_1_copy .g-pstyle4 {
height:41px;
position:relative;
}
#g-15calculator-Artboard_2_copy {
position:relative;
overflow:hidden;
}
#g-15calculator-Artboard_2_copy p {
font-family:nyt-franklin,arial,helvetica,sans-serif;
font-weight:300;
line-height:41px;
height:auto;
opacity:1;
letter-spacing:0em;
font-size:16px;
text-align:left;
color:rgb(0,0,0);
top:1.3px;
position:static;
text-transform:none;
padding-bottom:0;
padding-top:0;
mix-blend-mode:normal;
font-style:normal;
}
#g-15calculator-Artboard_2_copy .g-pstyle0 {
line-height:13px;
height:13px;
font-size:12px;
top:1px;
position:relative;
}
#g-15calculator-Artboard_2_copy .g-pstyle1 {
line-height:12px;
height:12px;
font-size:12px;
top:1px;
position:relative;
}
#g-15calculator-Artboard_2_copy .g-pstyle2 {
font-weight:700;
height:41px;
text-align:right;
position:relative;
}
#g-15calculator-Artboard_2_copy .g-pstyle3 {
height:41px;
position:relative;
}

TYPICAL

HOME PRICE

TYPICAL

HOME PRICE

MARKET

MARKET

$161,000

$325,000

$233,000

$389,000

$555,000

$264,000

$146,000

$390,000

$145,000

$239,000

$699,000

$590,000

$868,000

$347,000

$595,000

$309,000

$327,000

$385,000

$241,000

$211,000

$609,000

$695,000

$454,000

$441,000

$323,000

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

13.

Columbus, Ga.

Ellsworth, Maine

Logan, Ohio

Spring Hill, Fla.

Sneads Ferry, N.C.

Winter Haven, Fla.

Stanton, Ky.

Port Angeles, Wash.

Akron, Ohio

Fairbanks, Alaska

Mineral, Va.

Fernandina Beach, Fla.

Anaheim, Calif.

14.

15.

16.

17.

18.

19.

20.

21.

22.

23.

24.

25.

Beaufort, S.C.

North Myrtle Beach, S.C.

Fennville, Mich.

Helen, Ga.

North Las Vegas, Nev.

Wisconsin Dells, Wis.

Oneonta, N.Y.

Huddleston, Va.

Cocoa Beach, Fla.

Bradenton, Fla.

Largo, Fla.

Ashford, Wash.

TYPICAL

HOME PRICE

MARKET

$161,000

$325,000

$233,000

$389,000

$555,000

$264,000

$146,000

$390,000

$145,000

$239,000

$699,000

$590,000

$868,000

$347,000

$595,000

$309,000

$327,000

$385,000

$241,000

$211,000

$609,000

$695,000

$454,000

$441,000

$323,000

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

13.

14.

15.

16.

17.

18.

19.

20.

21.

22.

23.

24.

25.

Columbus, Ga.

Ellsworth, Maine

Logan, Ohio

Spring Hill, Fla.

Sneads Ferry, N.C.

Winter Haven, Fla.

Stanton, Ky.

Port Angeles, Wash.

Akron, Ohio

Fairbanks, Alaska

Mineral, Va.

Fernandina Beach, Fla.

Anaheim, Calif.

Beaufort, S.C.

North Myrtle Beach, S.C.

Fennville, Mich.

Helen, Ga.

North Las Vegas, Nev.

Wisconsin Dells, Wis.

Oneonta, N.Y.

Huddleston, Va.

Cocoa Beach, Fla.

Bradenton, Fla.

Largo, Fla.

Ashford, Wash.

Source: AirDNA

By The New York Times

For weekly email updates on residential real estate news, sign up here.

This post was originally published on 3rd party site mentioned on the title of this site

Similar Posts

X
0
    0
    Your Interest
    Your Interest List is emptyReturn to Buying
    ×