{"id":178502,"date":"2024-10-21T16:26:06","date_gmt":"2024-10-21T22:26:06","guid":{"rendered":"https:\/\/www.biggerpockets.com\/blog\/?p=178502"},"modified":"2024-10-21T16:26:10","modified_gmt":"2024-10-21T22:26:10","slug":"best-5-nonseasonal-short-term-rental-markets","status":"publish","type":"post","link":"https:\/\/www.biggerpockets.com\/blog\/best-5-nonseasonal-short-term-rental-markets","title":{"rendered":"5 Year-Round Markets Where Short-Term Investors Can Rake In Cash"},"content":{"rendered":"\n

I\u2019m from a city where you sweat just by stepping outside for a <\/span>couple of<\/span> seconds (<\/span>Houston, Texas<\/span><\/a>). The first time I ever traveled to New Hampshire was in September year ago, and it was the most <\/span>amazing<\/span> climate I had ever felt. I left and could not wait to return to enjoy getting out of the concrete sauna I lived in.<\/span><\/p>\n\n\n\n

Fast-forward to December of the <\/span>next<\/span> year. I returned to New Hampshire with a few light jackets, not knowing I was walking into the North Pole when I stepped off the plane. I thought my phone was broken, reading -4\u00b0F at one point, and that no human could survive in this science experiment-like setting. The insides of my nose froze just walking outside, and I learned quickly that I was not built to live in the Northeast (sorry to any of my friends there).<\/span><\/p>\n\n\n\n

I tell this story to show the extremes of several of the most enticing <\/span>STR<\/span><\/a> markets. Seasonal markets may be the answer for year-round activity without the extreme wardrobe changes needed.<\/span><\/p>\n\n\n\n

What Is a Nonseasonal Market?<\/span><\/h2>\n\n\n\n

A nonseasonal market <\/span>is one that<\/span> rarely slows down.<\/span> These tend to have slight weather variances (comparatively speaking to others) and enough events or occupancy to keep guests coming all year round. <\/span><\/p>\n\n\n\n

But slow down before you think all markets with good weather are slam dunks. Some of the best markets in the country can produce enough income in just four to five months, which still makes the owners see a solid return with less work.<\/span> <\/span><\/p>\n\n\n\n

When diving into short-term rental markets, it\u2019s fun to daydream about cozy cabins and beach bungalows, but you can\u2019t ignore the numbers. It’s good we have <\/span>AirDNA<\/span><\/a> to nerd out over essential data points like seasonality, average daily rate (ADR), and occupancy. <\/span><\/p>\n\n\n\n

Unless you buy in a vacation town-only market like Pigeon Forge, Tennessee, or Gulf Shores, Alabama, understanding all exit strategies is crucial to making a sound long-term investment. Using the <\/span>BiggerPockets Market Finder<\/span><\/a>, you can see exactly the type of data you need to compare markets. <\/span><\/p>\n\n\n\n

Suppose you ever need to pivot away from STRs because of regulations or underperformance. In that case, these long-term metrics like the rent-to-price ratio (RTP), median home price, and affordability percentage will help you sleep at night, knowing you still have an investment with a high upside.  <\/span><\/p>\n\n\n\n

Understanding the Metrics<\/span><\/h2>\n\n\n\n

While both of these tools (AirDNA and Market Finder) are based on data averages here, <\/span>nothing<\/span> will <\/span>ever compare to<\/span> identifying a market and examining your competition in that market<\/span><\/a>.<\/span><\/p>\n\n\n\n

What are the <\/span>comparables<\/span><\/a> sold? What are the top-performing STR properties in the area? How can you beat them out with amenities? What is the typical long-term rent in the area? Ask any other question that will help give you the complete <\/span>picture of a market<\/span>.<\/span><\/p>\n\n\n\n

Seasonality rate<\/span><\/h3>\n\n\n\n

You might think a high seasonality number is terrible, but here\u2019s the twist\u2014it\u2019s not. A higher seasonality rate means demand stays more consistent throughout the year. If you\u2019re looking at a market with a high rate, you\u2019re less likely to sit around in the slow months staring at an empty calendar. The higher the number, the fewer slowdowns. <\/span><\/p>\n\n\n\n

Average daily rate (ADR)<\/span><\/h3>\n\n\n\n

This is a fancy way of saying how much money you can make per night. <\/span>A higher ADR means more cash per booking, which is<\/span> a <\/span>good <\/span>thing<\/span>.<\/span> <\/span><\/p>\n\n\n\n

Occupancy rate<\/span><\/h3>\n\n\n\n

This is how often people are staying in your place. Even if your ADR is through the roof, if no one\u2019s booking your property, that money is just a dream. <\/span><\/p>\n\n\n\n

Rent-to-price (RTP) ratio<\/span><\/h3>\n\n\n\n

The median house price is divided by the annual median rent. Think of this as your return on investment. The higher the RTP ratio, the better return you\u2019re getting compared to what you spent on the property. <\/span><\/p>\n\n\n\n

Affordability percentage<\/span><\/h3>\n\n\n\n

This one\u2019s a little different. It tells you how much of the average household income is needed to afford the median home price in that market. If this number is low, homes will be more expensive than what people make. High number? Your dream home just got a little more accessible.<\/span><\/p>\n\n\n\n

The Top 5<\/span><\/h2>\n\n\n\n

I want to mention <\/span>Las Vegas<\/span><\/a> as possibly the most nonseasonal market in the US, but with strict regulations, I can\u2019t fully endorse it as a great market to invest in. There are 13,000 active listings, so people are <\/span>obviously<\/span> still operating, but I would be very nervous. <\/span><\/p>\n\n\n\n

Let\u2019s get into the top five!<\/span><\/p>\n\n\n\n

5. Oklahoma City, Oklahoma<\/span><\/h3>\n\n\n\n