Don't forget about the little guys.
When it comes to finding the strongest locations for Airbnb and Vrbo hosts right now, some might look for sky-high revenues or destinations with the most room for income growth. But it's a cruel summer for short-term rental hosts, as many vacationers are seeking out lower nightly rates and last-minute bookings, putting pressure on hosts in busier markets.
But there are still small cities and regional watering holes across the country that are wise investments for hosts looking to get their foot in the door, according to a new report from short-term rental analytics site AirDNA.
These spots might not always grab headlines, but the report notes their rising demand from short-term renters, their flourishing host communities, and their accessible real-estate price points make them attractive locations to operate long-term as a host.
To compile the report, AirDNA looked only at locations with between 100 and 500 whole-home listings with between one and five bedrooms. These spots proved a "happy middle ground" of established destinations that are not yet "name-brand" vacation spots, AirDNA Director of Enterprise Marketing Dillon DuBois told Insider.
Each destination had at least 85% of all listings from last year still available — any larger exodus might indicate unhappy hosts. All locations that made the cut also experienced positive growth in bookings from 2022, bucking the trend of some nationwide hotspots struggling.
Locations were knocked out of the ranking if professional hosts, or those with more than 21 rentals, operated a majority of the area listings. AirDNA focused on spots that weren't dominated by "well-oiled machines,"DuBois said. It also excluded markets with strict regulations.
Then, a "bang for your buck" metric was applied: the yield. It's the annual revenue an average host stands to make, based on the area's booking numbers and daily rates, divided by the average home price. The higher a location's yield, the higher it ranked. AirDNA supplied all figures except for average home prices, which are from Zillow and used by AirDNA in its ranking.
In the end, the list highlights stable, overlooked spots in states including Wisconsin, Mississippi, Ohio, and beyond.