Top 10 Cities for Airbnb Properties in 2022
Buying an Airbnb property is becoming an increasingly popular investment all over the world. However, before you take the plunge, you might want to learn as much as you can about the best locations for your short-term rentals. In this post, we’re going to introduce a list of the best US cities for your Airbnb property business for 2022.
Why Investing in an Airbnb Rental Is a Good Idea?
For many people, running an Airbnb business is a very lucrative way of boosting their passive income. It can also be a very profitable real estate investment strategy that’s often better than just renting to one tenant.
Before you start your real estate investment journey, consider the following benefits over a more traditional real estate plan:
Airbnb Rentals Are an Excellent Source of Passive Income
Thanks to the many vacation rental platforms that have popped up in recent years, there are many opportunities for you to generate an excellent passive income stream. All you need to do is to find the best short-term rental manager in your area to start generating passive income.
It’s More Lucrative Than a More Traditional Real Estate Investment
You can charge more per day for your Airbnb than you would with a traditional real estate investment. This means your profits will be higher.
You Can Use Your Rental Property for Yourself
If you want to use your rental property as a second home, nothing is stopping you. Likewise, you can use it for regular short-term vacations.
You Have a Varied Portfolio of Tenants
Having a long-term tenant in your property does have its advantages, especially if they always pay their rent on time. However, when they fail to pay or always pay late, it can have massive repercussions.
On the other hand, short-term tenants are individually responsible for just a tiny part of your annual income.
Airbnb Properties Give You Much More Control Than Traditional Rentals
Managing an Airbnb property can take more work and incur higher costs, but it is much easier. You’re more hands-on and able to spot any maintenance issues, which gives you more control.
It’s also possible to increase or decrease your prices regularly, depending on the season or any special events. This gives you more control regarding the pricing policy.
You Face a Wider Choice of Guests to Attract
As an Airbnb host, you can be much more selective regarding the type of guests you’re targeting. A traditional landlord, on the other hand, usually markets their property to a much wider audience.
Factors to Have in Mind When Choosing the Location for Your Airbnb Rental Property
Location, location, location – it’s all about the location in any real estate transaction. However, it’s even more crucial when you want to invest in a vacation rental property. Choosing the right location is essential, and here are some factors you need to have in mind:
- Local laws and regulations regarding short-term rentals: You’ll find many local areas have strict rules and regulations in place regarding short-term rentals. Understanding what these are will save a lot of headaches further down the road.
- Low and high season fluctuations: Understanding the natural rhythms will help with budgeting, forecasting, and marketing.
- Positive signs of growth: Ideally, your rental should be in an area that’s experiencing healthy economic growth.
- HOA (Home Owner’s Association) rules: Check whether there are any HOA restrictions and have them in writing before making any offers to buy.
- Local demand for vacation rentals: A professional agent will help you understand the minor local differences in rental trends.
- Type of guest you want to attract: Having a picture of your ideal guest will help you focus on all aspects of your rental.
- Proximity to local attractions: Is your ideal guest a young family that will be looking for a rental close to local parks and beaches?
What Are the 10 Best Cities for an Airbnb Real Estate Investor in 2022?
These 10 best cities display all the key factors if you want to rent out on Airbnb in 2022:
1. Abilene, TX
- Average CoC Return: 7.22%
- Average Monthly Rental Income: $3,002
- Average Daily Rate: $174
- Average Occupancy Rate: 62.5%
- Median Property Price: $288,029
2. Athens, GA
- Average CoC Return: 6.10%
- Average Monthly Rental Income: $3,638
- Average Daily Rate: $187
- Average Occupancy Rate: 60.3%
- Median Property Price: $398,626
3. Waco, TX
- Average CoC Return: 5.95%
- Average Monthly Rental Income: $3,408
- Average Daily Rate: $194
- Average Occupancy Rate: 59.4%
- Median Property Price: $387,763
4. Virginia Beach, VA
- Average CoC Return: 5.92%
- Average Monthly Rental Income: $4,528
- Average Daily Rate: $263
- Average Occupancy Rate: 59.2%
- Median Property Price: $546,780
5. Chandler, AZ
- Average CoC Return: 5.72%
- Average Monthly Rental Income: $4,450
- Average Daily Rate: $196
- Average Occupancy Rate: 67.5%
- Median Property Price: $510,543
6. Indianapolis, IN
- Average CoC Return: 4.87%
- Average Monthly Rental Income: $2,509
- Average Daily Rate: $161
- Average Occupancy Rate: 55.9%
- Median Property Price: $348,293
7. Tuscaloosa, AL
- Average CoC Return: 4.72%
- Average Monthly Rental Income: $3,530
- Average Daily Rate: $543
- Average Occupancy Rate: 40.5%
- Median Property Price: $624,929
8. Toledo, OH
- Average CoC Return: 4.22%
- Average Monthly Rental Income: $1,905
- Average Daily Rate: $105
- Average Occupancy Rate: 67.7%
- Median Property Price: $150,109
9. Minneapolis, MN
- Average CoC Return: 3.25%
- Average Monthly Rental Income: $2,749
- Average Daily Rate: $146
- Average Occupancy Rate: 66.2%
- Median Property Price: $400,427
10. Tampa, FL
- Average CoC Return: 2.29%
- Average Monthly Rental Income: $2,565
- Average Daily Rate: $156
- Average Occupancy Rate: 47.7%
- Median Property Price: $580,094
The Airbnb analytics used in the list above come from Mashvisor, a real estate data analytics company.
One critical factor to consider and check for each city is the local regulations regarding short-term rentals. If you’re considering becoming an Airbnb host in any of these locations, make sure you do your research before buying a property there. While vacation rentals are generally legal in all these top markets, some of them have specific rules regulating the industry.
When you’re deciding whether to invest in an Airbnb, remember that the figures given above are just city averages. Carefully analyzing and searching for relevant investment properties in an area is essential if you want to maximize your return on investment.