Looking to make some Airbnb income? Then purchase a property in a small or medium-sized market with lots of residents. Preferably one with warmer weather. According to data from the AAOA, these are your best bet for banking big bucks on the short-term rental market.
AirDNA is a short-term rental data and analytics company. They recently published a “Best Places to Buy a Vacation Home” list. According to them, Sevierville and Gatlinburg, Tennessee are some of the most promising markets. Especially for investors with low starting budgets. In Gatlinburg, the average Airbnb property makes more than $53K per year. And, according to the numbers, it only costs an average of $8K in mortgage payments. That’s less than $700 per month.
Sevierville’s a good bet too. With mortgage costs averaging $10K annually but an average profit of $43,350. Looking to stick around the FL area? Kissimmee is located not that far from Disney World and is also listed as a top spot. Averaging more than $37K in profits each year with an average daily rate of $206.
Other cities good for low-budget, high-profit rental properties are surprising. The list includes Las Vegas, Fort Walton Beach and Pensacola, FL. Pigeon Forge, Tennessee is also on the list. If you have a higher budget, a home in Palm Springs, CA could bring in nearly $75K per year. While Florida’s Destin and Key West offer annual earning of almost $60K.
Want the best possible ROI on your vacation rental investment? Then steer clear of big cities with red-hot housing markets, says Airdna’s Leslie James. In places like New York, Los Angeles and throughout California, rental investors actually stand to lose cash in the long run.
“Airbnb investors in cities where house prices are sky-high and competition is fierce – think Los Angeles and NYC – would actually make a negative return on investment of tens of thousands of dollars,” James wrote. “It’s a similar story for small markets, which are often just as expensive, such as Santa Monica, Oakland and Berkeley, CA. Long-term rentals might show an alternative trend.
The average Airbnb rental in Berkeley loses about $27K per year, while those in Oakland and Santa Monica lose around $20K.
If you have an interest in investment properties, call us today. We are licensed throughout the state of Florida and have a vast referral network reaching across the U.S. There’s not time like now to start making your money work for you!