Welcome to the first Rented.com Short Term Rental Income Report.
Recent years have seen unprecedented growth within the vacation rental and short-term rental sectors. Though the traditional vacation rental industry has been thriving for decades, it was really with the more recent astronomic growth in popularity of Airbnb that the broader short-term rental, or alternative accommodation sector, came to the general public’s attention.
No longer are travelers only exploring “alternative” accommodations (i.e., not hotels) when they visit beach and ski markets on vacation; they are also increasingly turning to them for city breaks and even business trips. For this reason, rather than limit the report to vacation rental markets, the Rented.com Report spans 120 markets for which there is short-term rental demand across the entire United States.
So what new does the report look at for these markets? There is already the National Association of Realtors’® annual Investment and Vacation Home Buyers Survey that looks at second home sales across the country. There are also TripAdvisor’s reports on the most popular vacation rental destinations from a traveler’s perspective.
But while these existing reports cover what is popular with homeowners and what is popular with guests, neither brings the two together to answer one critical question we constantly get at Rented.com:
The Rented.com Short-term Rental Income Report addresses this head on.
Looking at the costs of homeownership versus the short-term rental potential across 120 US markets, Rented.com is pleased to provide the first publicly available objective assessment of short-term rentals from an investor’s perspective.
The costs of homeownership include a variety of factors from purchase price and local property taxes, to home insurance, maintenance, and more. The short-term rental potential pulls from a variety of sources, including actual Rented.com demand from management companies in these markets, Everbooked occupancy and rental rate projections, and the current legal situation in each market. As all of these factors are subject to change, we intend this to be a report that is updated annually at a minimum.
To begin, there are some results that are likely counterintuitive to many.
It is not the flashy markets with the highest nightly rates (and also many of the toughest HOA and rental restrictions) that are necessarily the best investments. If they are popular with everyone, the purchase price is also high, diminishing any potential returns.
On the other hand, less well known markets that are still popular with travelers (markets like Gatlinburg where you can find a five-bedroom house for less than $300,000) can make great investments. Because these markets are often highly dependent on vacation rentals to drive visitors and bring money into the coffers of the local government, they also tend to be some of the most friendly towards short-term renting. To check the local regulations in your market, view our Short Term Rental Regulations Tracker.
These markets bring together a killer combination from an investor’s perspective: attractive purchase price, relatively high rental demand, and typically light regulation.
When seen in this light, this makes other results far from surprising. For example, of course Florida takes four out of our top ten spots given the state government has explicitly recognized and embraced the positive economic benefits from short-term rentals, and thus has banned local governments from restricting them.
All of this to say, we hope you enjoy the first ever Rented.com Short Term Rental Income Report.
Have fun clicking around and learning about the markets below. And should you decide to eventually invest in one or more properties for the purposes of short-term renting, we at Rented.com are always happy to help.
As measured by ROI
As measured by ROI