10 Best Markets for Short Term Rentals: Increase Your Profits Now

In the evolving landscape of real estate investment, short-term rentals are shining bright, offering a lucrative avenue for investors to boost their profits. With the rise of platforms like Airbnb and VRBO, the game has changed. Now, more than ever, the market thrives on flexibility, unique guest experiences, and the promise of a handsome return on investment.

But, where should you put your money? That’s the golden question. Here, we simplify the complex, guiding you to the best markets for short-term rentals today. From the vibrant streets of Nashville, Tennessee, to the breathtaking vistas of Maui, Hawaii, we delve into where you can maximize your investment returns.

Read more to uncover hidden gems and tried-and-true markets that promise not just to meet, but exceed, your investment expectations.

  • Chattanooga, Tennessee
  • Sevierville, Tennessee
  • Maui, Hawaii
  • Kenai Peninsula, Alaska
  • Gatlinburg, Tennessee

Our focus is not just on high-demand locations but also on the quality of life, economic growth, and regulatory environments that make these markets stand out. Whether you’re a first-time investor or looking to expand your portfolio, understanding the dynamics of the short-term rental market is crucial.

Infographic illustrating the top short-term rental markets along with their annual revenue potential, growth rating, and investability scores - best markets for short term rentals infographic pillar-4-steps

In the pages ahead, we will break down why short-term rentals could be your next big win, key factors for success, and, of course, the best markets to consider. With our eyes set on maximizing your return and ensuring a seamless investment journey, let’s take the first step into the promising world of short-term rental investments.

Why Short-Term Rentals?

Profit Potential
One of the most compelling reasons to dive into short-term rentals is the profit potential. Compared to traditional long-term rentals, short-term rentals can command higher daily rates. This is especially true in tourist hotspots or city centers where demand is high. The summer of 2023 saw a significant rise in bookings in natural environments like rural, mountainous, and coastal areas, indicating a growing market segment ripe for investment.

Flexibility
Flexibility is another key advantage. As a property owner, you have the freedom to use your property for personal reasons in between bookings. This flexibility allows you to enjoy your investment property while also making it work for you financially. It’s a win-win situation that traditional long-term rentals simply can’t offer.

Guest Experience
Lastly, focusing on the guest experience can set your property apart. Today’s travelers are looking for more than just a place to stay; they’re seeking a unique and memorable experience. Whether it’s the charm of a remote cabin in the woods or the luxury of a beachfront condo, enhancing the guest experience can lead to higher occupancy rates and, ultimately, more profit. The rise in demand for hotel-like experiences in short-term rentals, as noted in our research, underscores the importance of offering a seamless, tech-driven stay that meets modern travelers’ expectations.

Read more about enhancing guest experience here.

In conclusion, the thriving market for short-term rentals presents a lucrative opportunity for investors. By focusing on profit potential, flexibility, and guest experience, you can maximize your investment and enjoy the benefits of this dynamic and growing sector. We’ll explore the key factors influencing short-term rental success and pinpoint the best markets for short-term rentals to help you make informed decisions on where to invest next.

Key Factors Influencing Short-Term Rental Success

When diving into short-term rentals, understanding the pillars of success is crucial. Let’s break down these key factors: Location, Regulations, Market Demand, and Property Management. Each plays a vital role in turning your investment into a profitable venture.

Location: The Heart of Success

The old adage “location, location, location” rings especially true in the short-term rental market. The best markets for short-term rentals often share common features: they’re accessible, appealing, and vibrant. Think about places near major tourist attractions, business centers, or natural beauty. Locations like Florida and Asheville, North Carolina, offer unique draws such as coastal access or an arts scene, respectively.

Understanding and complying with local regulations is non-negotiable. Cities and towns have varying rules concerning short-term rentals, from outright bans to requiring specific licenses. For instance, some areas limit the number of days a property can be rented out annually, impacting profitability. Always research local laws to ensure your investment doesn’t hit legal snags.

Market demand can fluctuate based on season, economic conditions, and changing traveler preferences. Successful short-term rental investments cater to these trends, offering what guests are looking for. For example, the surge in bookings for natural environments post-COVID-19 highlights a shift in traveler priorities. Staying informed about such trends can help you adjust your offerings and pricing strategy accordingly.

Property Management: The Backbone of Operations

Effective property management ensures your rental runs smoothly, garners positive reviews, and remains competitive. This encompasses everything from marketing your property and managing bookings to maintaining the property and providing excellent guest experiences. Consider whether you’ll manage the property yourself or hire a professional team. The latter can be especially beneficial if you’re investing in a market far from your home base.

short-term rental success factors - best markets for short term rentals

By focusing on these critical factors, you position your investment for success in the competitive landscape of short-term rentals. Next, we’ll dive into the best markets for short-term rentals, offering insights into where your next investment could thrive.

10 Best Markets for Short Term Rentals

When it comes to choosing the best markets for short-term rentals, several factors come into play. Let’s explore where your investment could see the highest returns and why these locations stand out.

Florida

AirDNA reports show Florida is a hotspot for short-term rentals, thanks to its endless summer, coastal access, and vibrant local scenes. Cities like Orlando and Miami not only attract beach lovers but also families heading to the world-renowned theme parks. The state’s regulatory environment is relatively friendly to short-term rental investors, making it an attractive option.

Ohio

You might be surprised to see Ohio on the list, but cities like Cleveland and Cincinnati are experiencing significant revenue growth and investability in the short-term rental market. Ohio offers a unique blend of urban and natural attractions, from the bustling arts scenes to the tranquility of its national parks.

South Carolina

South Carolina charms with its historical significance and proximity to both mountains and beaches. Charleston and Greenville, in particular, boast strong short-term rental markets, thanks to their rich history, stunning architecture, and culinary scenes.

Asheville, North Carolina

Asheville is known for its vibrant arts scene and plethora of outdoor activities, nestled in the Blue Ridge Mountains. This city attracts a diverse group of travelers, from hikers and bikers to those seeking a creative retreat.

Nashville, Tennessee

The music scene and cultural attractions make Nashville a perennial favorite for tourists. The city’s dynamic atmosphere, coupled with a steady stream of events and festivals, keeps the demand for short-term rentals high.

Austin, Texas

Austin’s mix of festivals, such as SXSW, and its growth as a tech hub make it a prime location for short-term rentals. The city’s motto, “Keep Austin Weird,” speaks to its unique culture and appeal to a wide array of visitors.

Savannah, Georgia

Savannah’s historical tours and coastal beauty make it a magnet for those seeking both relaxation and adventure. Its well-preserved architecture and famous squares offer a picturesque setting that’s hard to find elsewhere.

Charleston, South Carolina

Another South Carolina gem, Charleston, is renowned for its culinary scene and historical architecture. The city’s charm and hospitality drive a steady demand for short-term rentals, making it a lucrative market.

Scottsdale, Arizona

Scottsdale attracts visitors with its world-class golf courses and luxury amenities. The city’s sunny weather and upscale shopping districts add to its appeal as a premier short-term rental location.

Berkeley, New Jersey

Rounding out our list is Berkeley, New Jersey, notable for its high Airbnb cash on cash return and occupancy rate. Its proximity to New York City and the Jersey Shore makes it an attractive destination for both short getaways and longer vacations.

Each of these markets offers unique attractions and advantages for short-term rental investors. From the historical allure of Charleston to the vibrant music scene of Nashville, the key to success lies in understanding what makes each location appealing to potential guests. Regulatory considerations, market demand, and the local scene play significant roles in determining where to invest. By focusing on these elements, investors can maximize their returns in the ever-growing short-term rental market.

Next, we’ll dive into how to maximize your investment with tips on professional photos, listing platforms, dynamic pricing, and finding your market niche.

Maximizing Your Investment

Once you’ve pinpointed the best markets for short-term rentals, the next step is to optimize your investment to ensure maximum profitability and guest satisfaction. Here’s how:

Professional Photos

The power of first impressions cannot be overstated. Your property’s photos are often the first thing potential guests will see. High-quality, professional photos can make your listing stand out in a crowded market. A study from Weekender Management emphasizes the importance of hiring a professional photographer to capture the best angles, lighting, and features of your property. Investing in professional photography is not an expense; it’s an investment in your property’s appeal and success.

Listing Platforms

Choosing the right platform to list your property is crucial. Airbnb and VRBO are two of the most popular options, but don’t limit yourself. Explore niche platforms that cater to specific types of travelers, such as those looking for luxury accommodations or eco-friendly stays. The key is to be where your target guests are searching. By diversifying your presence across multiple platforms, you increase your property’s visibility and booking potential.

Dynamic Pricing

The short-term rental market is dynamic, with prices fluctuating based on demand, season, and local events. Utilizing dynamic pricing tools can help you adjust your rates in real-time to match market conditions. This approach can lead to higher occupancy rates and increased revenue. Tools like AirDNA offer insights and analytics to inform your pricing strategy, ensuring you’re competitive yet profitable.

Market Niche

Identifying and catering to a specific market niche can set your property apart. Whether it’s offering a family-friendly environment, pet-friendly accommodations, or a romantic getaway, understanding your target audience allows you to tailor your amenities, decor, and marketing efforts. For instance, if your property is near a popular hiking area, gear your offerings towards outdoor enthusiasts. This specialization can not only increase bookings but also foster higher guest satisfaction and repeat visits.

By focusing on these key aspects—professional photos, listing platforms, dynamic pricing, and finding your market niche—you can significantly enhance your property’s appeal and performance in the competitive short-term rental market. Success in real estate investment, especially in the realm of short-term rentals, is about more than just owning a property; it’s about strategic marketing, guest experience, and adaptability to market trends.

Frequently Asked Questions about Short-Term Rentals

After diving deep into the best markets for short-term rentals and understanding how to maximize your investment, you might have some questions. Let’s address some of the most common ones to give you a clearer picture.

What is a Good Airbnb Cap Rate?

A good Airbnb cap rate (capitalization rate) is often seen as a key indicator of a property’s potential return on investment. Typically, a cap rate between 4% to 8% is considered good, but this can vary based on location, property type, and market conditions. For example, properties in Reading, OH, and Forest Hills Boro, PA, showed promising cap rates of 7.58% and 7.52% respectively, indicating strong potential for investors.

How Can You Promote a Short-Term Rental Property?

Promoting your short-term rental effectively requires a mix of digital marketing strategies and exceptional guest experiences. Here are a few tips:
Use High-Quality Photos: This can’t be stressed enough. High-quality, attractive photos are crucial.
Leverage Social Media: Platforms like Instagram and Facebook are perfect for showcasing your property’s unique features.
Utilize SEO: Optimize your listing with keywords related to your location and property features to improve visibility.
Encourage Reviews: Positive reviews can significantly boost your property’s appeal. Encourage satisfied guests to leave a review.

Can You Really Make Money with Short-Term Rentals?

Yes, you can make money with short-term rentals, but it requires diligence, research, and strategy. Selecting the right location is crucial; areas with high tourist demand like Nashville, TN, and Austin, TX, tend to perform well. Additionally, understanding your target market and optimizing your listing and pricing strategy based on market demand can significantly increase your revenue.

The short-term rental market is dynamic. Staying informed about market trends, regulatory changes, and adapting your strategy accordingly is key to success. With the right approach, short-term rentals can be a lucrative investment opportunity.


In the realm of real estate investment, especially in short-term rentals, knowledge, and adaptability are your best assets. Whether you’re just starting out or looking to expand your portfolio, addressing these frequently asked questions is a step towards ensuring your venture is profitable and sustainable. Continue to educate yourself and seek out innovative strategies to stay ahead in the competitive short-term rental market.

Conclusion

Investing in short-term rentals is more than just buying a property and listing it; it’s about strategic planning, understanding market dynamics, and aligning with the right partners. At Weekender Management, we’ve seen the difference a thoughtful approach can make.

Investment Strategy

Our journey into short-term rentals has taught us that the best markets for short-term rentals are not static; they evolve with travel trends, economic shifts, and regulatory changes. This is why our investment strategy is built on flexibility, market research, and an in-depth understanding of what makes each location unique.

We focus on markets that offer a combination of high demand from travelers, favorable regulations, and strong potential for property appreciation. From the sunny beaches of Florida to the historical charm of Charleston, South Carolina, we’ve identified locations where investors can not only expect a good return on investment but also enjoy the process of hosting guests from around the world.

Weekender Management

Our role is to make the journey into short-term rental investment as smooth and profitable as possible.
Real estate investment strategy - best markets for short term rentals
We offer a comprehensive suite of services designed to maximize your investment. This includes dynamic pricing to ensure you’re always competitive, marketing excellence to make your property stand out, and guest experience enhancements that lead to positive reviews and repeat bookings.

Moreover, our comprehensive property management covers everything from maintenance to guest communication, allowing you to enjoy the benefits of your investment without the day-to-day hassles. Our approach is simple but effective: combine market insights with operational excellence to not only meet but exceed market expectations.

Investing in short-term rentals can be a rewarding venture, both financially and personally. With the right strategy and the support of a dedicated team like Weekender Management, you can transform a good vacation rental property into a great one. Our commitment is to help you maximize your investment’s profitability and ensure its success in the competitive vacation rental market.

Whether you’re new to vacation rental investments or looking to expand your portfolio, our team is here to guide you every step of the way. Explore our real estate investing services and discover how we can help you achieve your investment goals in 2024 and beyond. Let’s make your vacation rental property a standout success together.

In conclusion, the key to thriving in the short-term rental market is not just about where you invest, but how you manage your investment. At Weekender Management, we believe in the power of strategic investment and meticulous management to unlock the full potential of your property. Join us in exploring the best markets for short-term rentals and take the first step towards a successful and profitable venture.

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