AIRDNA - Best Places To Invest

13 Replies

We have the money, now my wife and I are trying to decide on our first rental spot. We live in Atlanta and still considering doing a traditional rental for our first property here (or maybe Nashville), but leaning towards the vacation rental due to higher potential revenue. 

Came across this on AIRDNA. Just wanted to know people's thoughts on some of these ratings.

https://www.airdna.co/blog/best-places-buy-vacation-rental-property

For our STR we are leaning towards somewhere in Florida (Kissimmee), Hawaii (Maui), Vegas

Great Question! Don't bother with Nashville there hasn't been money to be made in 6 years. 

As far as STR this forum will agree that the following are the best markets...


P Forge/GBurg TN 

Orlando

Big Bear

Coffeyville, KS 

Poconos 

Branson, MO

And areas of HI and FL if you're paying cash. 

Airdna is awesome but it's also not awesome if you don't understand its weaknesses. 

Plenty of info on this forum on all of these topics just do some searching. 

Hey @William Shropshire - welcome!  You're just a few hours from one of the best STR markets in the nation - Gatlinburg/Pigeon Forge/Sevierville TN. I've got three cabins there that make me great cash flow year round, and it's a true vacation rental market where the local economy has been driven by VR rentals for decades, it's as low-risk as you can get in terms of regulation. (vs. Nashville which just passed a new ordinance making it even more difficult to legally operate an STR, and there's less margin/higher entry cost)

Your first consideration should be regulations.  Look at what the rules are in each market that interests you - all three that you named have their own sets of regulations (Vegas is super strict) and you'll want to be comfortable with navigating those before you take any further steps.  After that, start to dig in to the real data (do your own manual research, AirDNA is a useful tool but its data is flawed, as you can read about by searching this forum).  

Also, spend some time browsing this forum, you'll find lots of discussion on a lot of different markets, and can learn a lot from others' experience. :)  

The first thing I would do is look at the regulations in all 3 areas. Vegas is getting stricter as is Kissimmee. @Mike V. can speak to the Hawaii market. 

The best markets with the highest returns vs. purchase price are The Smokies (I own 5 there), Panama City Beach, Big Bear, and a few others. The Palm Springs are also yields huge returns, but I believe their regulations allow 1 property per person and has minimum stay requirements. Hope that helps narrow it down some!

Coffeyville KS is great if you don't mind the crime, drugs and prostitution.  I live here.  

Originally posted by @William Shropshire :

We have the money, now my wife and I are trying to decide on our first rental spot. We live in Atlanta and still considering doing a traditional rental for our first property here (or maybe Nashville), but leaning towards the vacation rental due to higher potential revenue. 

Came across this on AIRDNA. Just wanted to know people's thoughts on some of these ratings.

https://www.airdna.co/blog/best-places-buy-vacation-rental-property

For our STR we are leaning towards somewhere in Florida (Kissimmee), Hawaii (Maui), Vegas

 There was a great thread on this recently:

https://www.biggerpockets.com/...

Originally posted by @Lucas Carl:

Great Question! Don't bother with Nashville there hasn't been money to be made in 6 years. 

As far as STR this forum will agree that the following are the best markets...


P Forge/GBurg TN 

Orlando

Big Bear

Coffeyville, KS 

Poconos 

Branson, MO

And areas of HI and FL if you're paying cash. 

Airdna is awesome but it's also not awesome if you don't understand its weaknesses. 

Plenty of info on this forum on all of these topics just do some searching. 

HA! Poconos are great if you don't mind abysmally low 20-25% annual occupancy rates, your property sitting vacant most of the year, super high expenses, totally unreliable cleaners & handymen (ever heard of the Pocono Promise? It’s when someone promises to show up at your home & you never hear from them again. It’s so common that it’s got a name!)

And now for the icing on the cake: after the recent Pa Supreme Court decision (Slice of Life vs Hamilton Twp), all of the Townships in the Poconos are in the process of regulating STRs in residentially-zoned areas (limiting # of STRs, imposing length of stay restrictions, imposing annual rental limits, imposing home inspections for STRs, etc, etc)

Poconos are great if you don't mind operating in an area with a tremendous over-supply of housing. A supply that so far exceeds demand that at all times, there's thousands of properties lingering on the for-sale market for years at a time. So everyone tries to STR the house that they wish they never bought (since they can't sell it!), which leads to a tremendous over-supply of STR that far exceeds STR demand. Sadly, this area doesn't attract the 10+ million overnight annual guests that Gatlinburg does - not even close.

How do I know all this? Got quite a few friends who love to vent to me about the Poconos house they wish they never bought!

In many cases, a small city or unincorporated area just next to one of the cities listed in the Airdna report, is going to be the winner.  If you can go just outside a city with tough regulations (or one that is about to regulate or ban) there are a lot of amazing opportunities that go overlooked.

Also I see Joshua Tree and Yucca Valley near the top of that list.  Both of those markets are likely to see a major change in their rental ordinance, or a drastic change in the enforcement of the existing ordinance, or both.  There are too many 1 bedroom homes being listed as accommodating 16+ people, and the locals are pissed.

Originally posted by @John D. :

Also I see Joshua Tree and Yucca Valley near the top of that list.  Both of those markets are likely to see a major change in their rental ordinance, or a drastic change in the enforcement of the existing ordinance, or both.  There are too many 1 bedroom homes being listed as accommodating 16+ people, and the locals are pissed.

 Oh wow. Yeah I can understand being upset.