Top 5 Profitable Short-Term Rental Markets In 2025 (And How to Finance Them)

In This Article

Brief-term rental investing isn’t what it was 5 years in the past—and that’s a good factor.

The market has lastly matured. What used to really feel like a Wild West of trial and error now comes with actual information, confirmed visitor conduct, and smarter underwriting. 

For traders, meaning we’re seeing one thing highly effective: steadiness. And when income turns into extra predictable, financing your subsequent deal turns into a lot simpler.

Wanting on the Information

That’s exactly why I teamed up with Host Monetary (utilizing AirDNA and Zillow information) to spotlight 5 STR markets that present sturdy demand and development and constantly outperform in gross rental yield (the upper the %, the higher).

Gross Rental Yield = (Annual Income / Median House Worth) × 100

It tells you ways a lot earnings you’re producing relative to the acquisition worth. The upper the proportion, the extra earnings you’re getting for each greenback you put money into shopping for the property.

Let’s say:

• The median residence worth in a market is $300,000.
• Annual STR income is $45,000.

Then:

Gross Rental Yield = ($45,000 ÷ $300,000) × 100 = 15%

Meaning you’re incomes 15% of the property’s worth in rental earnings every year—earlier than bills. That’s a powerful quantity, particularly for STRs.

These aren’t simply nice locations to speculate; they’re nice locations to get financed. With a DSCR (debt service protection ratio) mortgage, Host Monetary may help you qualify primarily based on what the property will earn as a short-term rental, not what it would deliver as a long-term lease.

Whether or not you’re making an attempt so as to add a cash-flowing trip rental or scale into a brand new state, listed here are 5 markets to look at in 2025, and precisely how Host may help you make it occur.

1. Shenandoah, Virginia

• Market rating: 94
• Annual income: $42K
• ADR: $266.51
• RevPAR: $128.94
• Common home worth: $255,593 
• Yield: 16.4%

Shenandoah is probably the most underrated short-term rental area within the U.S. With proximity to Shenandoah Nationwide Park and one of many highest income development scores within the nation, this vacation spot is outperforming even with average occupancy. Excessive ADRs, sturdy seasonality, and inexpensive property costs make it a win for nature-focused stays.

Financing tip

With regular RevPAR and favorable seasonality, Host may help you qualify utilizing STR-specific earnings projections, even in markets the place conventional rental comps fall brief.

2. Columbia, South Carolina

• Market rating: 98
• Annual income: $33.9K
• ADR: $201.50
• Occupancy: 57%
• Common home worth: $232,153
• Yield: 14.6%

Columbia is delivering top-of-the-line total AirDNA scores within the nation. With sturdy scores throughout income development (+10%), seasonality, and occupancy, it’s a primary instance of a midsized metropolis STR market on the rise. Bonus: Columbia is a university city, a capital metropolis, and a enterprise hub multi functional.

Financing tip

This is a “go massive or go residence” market. Giant houses are outperforming as a result of they entice households, sports activities journey teams, school reunion crews, and occasion friends. If you may supply beds, bogs, and daring design, Columbia will reward you.

3. Poconos, Pennsylvania

• Market rating: 60 
• Annual income: $53.2K
• ADR: $394.14
• RevPAR: $164.27
• Common home worth: $246,669
• Yield: 21.5%

The Poconos show that seasonal demand doesn’t must imply seasonal earnings. Providing larger houses that may sleep massive teams and facilities like sizzling tubs and sport rooms, you may command luxurious nightly charges, even when occupancy is barely decrease. Add a RevPAR of $164, and it’s nonetheless a high-yield machine.

Financing tip

Many properties right here fall into the large-home, high-income class. Host affords jumbo DSCR loans which are excellent for second houses which are producing $50K+ in annual income.

4. Tulsa, Oklahoma

• Market rating: 99
• Annual income: $28.3K
• ADR: $173.92
• RevPAR: $95.42
• Common home worth: $205,014
• Yield: 13.8%

Tulsa continues to shock STR traders. It’s obtained city attraction, rising tourism, and a various journey base. Occupancy and RevPAR have each seen wholesome development, and with a 91 Investability Rating, it’s primed for value-add STR traders who know market effectively and furnish good.

Financing tip

Whether or not you’re planning a short-term rental or holding as a long-term, Host Monetary may help you qualify utilizing both mannequin. For STRs, you may get permitted primarily based on projected Airbnb income. For LTRs, you should use customary lease comps. Tulsa is likely one of the few markets the place each financing paths make sense and supply substantial upside.

5. Destin, Florida

Market rating: 91

Annual income: $72.2K

ADR: $395.52

RevPAR: $245.60

Common home worth:$577,366

Yield: 12.5%

Destin won’t be “undiscovered,” but it surely’s nonetheless one of the worthwhile beachfront markets within the U.S. With income development of 11% and a $72K common gross, this Emerald Coast sizzling spot constantly rewards traders who play within the upper-mid or luxurious tiers. Jumbo DSCR loans enable traders to interrupt into luxurious short-term rental markets with no need conventional earnings verification.

As a substitute of utilizing your private earnings, lenders qualify the mortgage primarily based on the property’s projected rental efficiency. If you’ve got sturdy liquidity and a strong credit score rating, you may qualify for properties that exceed conforming mortgage limits. This opens the door to high-end STR offers that the majority traders by no means suppose are doable.

Financing tip

For a higher-price market like Destin, Host affords jumbo DSCR and second-home merchandise with versatile phrases—excellent for premium STRs in sizzling places. Prequalifying early is vital, particularly throughout aggressive seasons.

Why STR Financing Isn’t One-Dimension-Suits-All

Every market has completely different guidelines—some require allow approvals, others require STR earnings documentation, and lots of push for LLC vesting, relying in your mortgage kind. That’s why working with a lender specializing in trip leases makes all of the distinction.

Host Monetary helps you:

• Construction your mortgage with the proper entity.
• Use STR projections as an alternative of LTR comps.
• Get prequalified shortly, with minimal purple tape.
• Shut with confidence, even in permit-restricted areas.

Setting Your self Up for Success

When shopping for in rising short-term rental markets, a number of key methods separate profitable traders from the remainder. 

First, all the time get prequalified by speaking with Host Monetary. Use projected STR earnings instruments to safe higher mortgage phrases and strengthen, sooner affords. Discuss all the main points that go together with their completely different kind of mortgage merchandise. Lastly, understanding native zoning legal guidelines is important, as not each metropolis welcomes STRs equally, and understanding the native legal guidelines means you may keep compliant from day one. 

When you personal the property, design with the visitor expertise in thoughts since excessive ADRs usually come from distinctive touches, modern layouts, and nice aesthetics. 

Lastly, construct a community of native STR professionals, together with cleaners, allow places of work, and property managers, to maintain operations working easily and friends returning.

Last Ideas

The short-term rental business has grown, and so have the methods that drive the perfect returns. We’re now not in an period of guesswork. Because of extra constant visitor demand, stronger seasonality information, and smarter monetary merchandise, right now’s STR traders have the chance to construct actual, scalable portfolios in worthwhile, sustainable markets.

These 5 markets stand out as a result of they mix dependable income with favorable property pricing, producing gross rental yields that outpace many of the nation. Extra importantly, they provide room to develop.

What makes these alternatives much more accessible is the financing. With a DSCR mortgage from Host Monetary, you may qualify primarily based on what your property will earn as a short-term rental, not simply what it might deliver in as a long-term lease. Meaning your income potential works in your favor, opening the door to raised investments, even in markets with increased worth tags.

Whether or not you’re scaling into your second or tenth property, the system for fulfillment is identical: Perceive your market, design for the visitor, construct a strong native staff, and companion with a lender who really will get the STR sport.

If you’re able to get prequalified and begin making aggressive affords, Host Monetary is constructed for you. Let this be the 12 months you purchase smarter, scale sooner, and make investments with confidence.