The best city to invest in an Airbnb is….
Different for everyone! It’s probably not the answer you were looking for, but it is probably the city closest to you. Unlike long-term rentals, owning a short-term vacation rental requires a lot more work. While you don’t have to be there every day, or even every week, it is a good idea to live within a two-hour drive from your property at the most.
You could! But unlike a good old fashioned long-term rental, people who manage short-term rentals charge a lot more. Typical vacation rental management fees can range from 20% to even 50% of your gross earnings! That eats up profits really fast.
Being able to drive over once in a while to check on the property, and drop off supplies and essentials if necessary, gives you the opportunity to save a lot of money. And it’s never a bad idea to keep tabs on your investment.
A good place to start is by thinking about places within a two-hour drive that your friends and family would go to for a weekend getaway. I recommend making a list of these cities and then starting your analysis on AirDNA. AirDNA offers a lot of insight into the rental supply and demand in any given area. You can purchase a city or statewide report and eliminate all the speculation when it comes to picking a property. AirDNA will show you the top rentals in your market so you can see what amenities they offer and where they are located.
Nope! AirDNA has a market letter grade, so if all the numbers and graphs are intimidating to you, you can just go by the market grade. Anything B or above is a great place to purchase your first Airbnb property. All of our properties are in B-grade markets, and we still manage to make a lot of money with them. If you can manage to buy in an A-grade market you’re in luck!
Once you’ve figured out where to look, the next step is to figure out your buying power and start your search. If you’ve never purchased a property of your own before, check out our post, Finding A Profitable Airbnb Property, to learn how we found our first property and tips to help you find yours.
Originally from Connecticut, Kevin moved to Los Angeles in 2013 and worked his way up to becoming an editor on award-winning reality TV shows. Kevin owns 4 short term rentals in Southern California and founded AirHost Academy to help other hosts improve their business.
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