Predicting STR Income

Durham, North Carolina
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Predicting STR Income

Norah Whitten
New to Real Estate · Mebane, NC · Member since 2024 · 4 posts · 3 votes

Hello! STR newbie here - I am looking at investing in a STR in the Durham, NC area and am trying to predict rental income. I've looked on Air DNA and used google / AI in addition to talking with a friend who has a few STR in the area. According to my friend he feels AirDNA is not totally accurate as his rentals have always out performed what AirDNA predicts

With that being said, are there any other suggestions on how to predict this in order to really accurately analyze the deals I'm looking at?

Additionally, any advice for a STR newbie would be appriciated!

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Andrew SteffensBusiness Member
Tampa, FL · Member since 2022 · 3k+ posts · 3k+ votes
2w

Piggybacking a lot of the great responses above, I am an STR PM in Tampa FL as well as a sales broker. When I underwrite I use AirDNA (premium) where I can see the actual comps. I then look at the actual closest comps in terms of quality and amenities to the subject property. So if the subject house is a 3/2 basic renovated pool home I am looking for the closest in proximity and quality to the subject and using the 3 to form a bracket of high/low/mid and average. If its a popular area there should be plenty of data - if its a niche area it can be a bit trickier.

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  • Michael Eskenasy
    Investor · Pacific Northwest · Member since 2026 · 531 posts · 298 votes
    2w

    AirDNA is useful as a baseline, but I wouldn’t underwrite an STR off one tool. I’d build the estimate from actual nearby comps, seasonality, weekday vs. weekend rates, realistic occupancy, cleaning/management costs, and then run conservative/base/upside cases. The big trap is underwriting to the best operators in the market instead of asking what a normal first-year operator can reliably produce.

    For Durham specifically, I’d also want to understand why guests are coming to that exact pocket—Duke, medical, business, events, family visits, etc.—because two houses a few miles apart can perform very differently.

    If you have a property you’re looking at, send me the details. I’m happy to show you how I’d pressure-test the income before you buy it.

    1Reply
  • Amber Stout
    Lender · Tampa/Saint Petersburg, FL · Member since 2014 · 356 posts · 148 votes
    2w

    Hi Norah, I work with a lot of STR buyers on the lending side and my client's who are doing well typically will have an STR property manager underwrite the deal prior to putting in an offer. I would suggest connecting with a great PM in the area, who ideally owns themselves and also manages others and they'll be able to guide you. Also, if you have any questions on the loan side, I specialize in STRs and happy to answer any questions.

    1Reply
    • Norah Whitten
      OP
      New to Real Estate · Mebane, NC · Member since 2024 · 4 posts · 3 votes
      2w

      Thank you! Do you have advice for finding an STR PM? My friend who I mentioned has 3 STRs in the area and manages 2 others so he does have a good sense of the market but I feel it never hurts to talk to multiple people.

      0Reply
  • Diana Khan
    Attorney · 10451 Mill Run Cir #755 Owings Mills, MD 21117 · Member since 2024 · 333 posts · 123 votes
    2w
    Quote from @Norah Whitten:

    Hello! STR newbie here - I am looking at investing in a STR in the Durham, NC area and am trying to predict rental income. I've looked on Air DNA and used google / AI in addition to talking with a friend who has a few STR in the area. According to my friend he feels AirDNA is not totally accurate as his rentals have always out performed what AirDNA predicts

    With that being said, are there any other suggestions on how to predict this in order to really accurately analyze the deals I'm looking at?

    Additionally, any advice for a STR newbie would be appriciated!

    @Norah Whitten, one thing I've learned from working with property owners and investors is that I would be careful using someone else's strong STR results as the standard for a new property. Your friend may be outperforming AirDNA because they already know the market, have good reviews, understand pricing, and have systems that took time to build. I would want the property to work even if your first year is not as strong as theirs.

    I would also verify the things that can limit the income before trusting any projection. Make sure the local rules allow the use you are planning, check for HOA restrictions, insurance requirements, parking or occupancy limits, and any permits or licenses you may need. I've seen investors spend a lot of time trying to perfect the income number when the bigger question was whether the property could legally and practically operate the way they were modeling it.

    I like that you are doing the research before buying instead of trying to make the numbers work after the fact, and I’d be glad to stay connected and see what you decide on the Durham property.

    0Reply
    • Norah Whitten
      OP
      New to Real Estate · Mebane, NC · Member since 2024 · 4 posts · 3 votes
      2w

      Thank you!! Yes the HOA / zoning laws etc is something I came across in my googling. Luckily thus far in my research I have not found any restrictions but will definitely continue my due diligence there.

      What advice do you have on figuring out how the first year could pan out? I’ve been trying to look at comps but it does feel like at the end of the day there is still a big guess bc it seems like most of the comps I’m finding are a bit more established.

      0Reply
  • Andrew SteffensBusiness Member
    Tampa, FL · Member since 2022 · 3k+ posts · 3k+ votes
    2w

    Piggybacking a lot of the great responses above, I am an STR PM in Tampa FL as well as a sales broker. When I underwrite I use AirDNA (premium) where I can see the actual comps. I then look at the actual closest comps in terms of quality and amenities to the subject property. So if the subject house is a 3/2 basic renovated pool home I am looking for the closest in proximity and quality to the subject and using the 3 to form a bracket of high/low/mid and average. If its a popular area there should be plenty of data - if its a niche area it can be a bit trickier.

    [email protected]813-563-0877
    Vacation Rentals of Florida53 Reviews
    WebsiteView Page
    3Reply
  • Cody Z.
    Real Estate Agent · Belmar, NJ · Member since 2017 · 370 posts · 200 votes
    2w
    Quote from @Norah Whitten:

    Hello! STR newbie here - I am looking at investing in a STR in the Durham, NC area and am trying to predict rental income. I've looked on Air DNA and used google / AI in addition to talking with a friend who has a few STR in the area. According to my friend he feels AirDNA is not totally accurate as his rentals have always out performed what AirDNA predicts

    With that being said, are there any other suggestions on how to predict this in order to really accurately analyze the deals I'm looking at?

    Additionally, any advice for a STR newbie would be appriciated!


    Give bnbcalc a try as well. Ultimately, you'll want to try and use data from at least two sources once you narrow down your search to get a little more comfort around the forecasted revenue.

    Strongly recommend that you focus on properties with the guest favorite badge run by super hosts as well.

    1Reply
  • Ashley RigsbeePro Member
    Customer Success & Onboarding Specialist at BiggerPockets · Charlotte, NC · Member since 2023 · 54 posts · 22 votes
    17h

    Welcome, Norah always great to see another North Carolinian digging into STRs! I love that you're testing AirDNA instead of taking it at face value. Your friend's real booking history is probably your best data source, so if he's willing to share his occupancy and average nightly rate by season, that's a great reality check. And since you mentioned the medical and event demand near that listing, it might be worth looking at a mid-term rental (traveling nurses etc) as a backup plan, so the deal still works if STR numbers come in softer than you hope.

    BiggerPockets
    0Reply
  • Ashish AcharyaBusiness Member
    CPA, CFP®, PFS · FL · Member since 2017 · 5k+ posts · 3k+ votes
    6h

    Norah, I'd avoid relying on any one STR data source by itself, including AirDNA.

    For a deal like this, I’d compare AirDNA against actual nearby listings that are as similar as possible in bedroom count, amenities, location, and guest capacity. I’d look at their nightly rates, calendar availability, reviews, and how pricing changes between weekdays, weekends, and peak seasons.

    I'd also underwrite with a conservative occupancy assumption rather than using the best-case number. STR income can move a lot based on seasonality, events, cleaning fees, platform fees, utilities, furnishing costs, maintenance, and local competition.

    The other thing I'd pay close attention to is local regulation. Before buying, make sure the specific property is actually eligible for STR use and that there aren't zoning, HOA, permitting, or occupancy restrictions that could change the economics.

    From the tax side, STRs can also be very different from traditional rentals depending on average guest stay and your level of participation, so it’s worth thinking about the tax strategy before the property is already operating.

    Feel free to DM me, I'd be happy to send over our Turn Key Rental Analyzer and a few STR tax resources that may help you pressure-test the deal before you buy.

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  • Diana Khan
    Attorney · 10451 Mill Run Cir #755 Owings Mills, MD 21117 · Member since 2024 · 333 posts · 123 votes
    2h
    Quote from @Norah Whitten:

    Hello! STR newbie here - I am looking at investing in a STR in the Durham, NC area and am trying to predict rental income. I've looked on Air DNA and used google / AI in addition to talking with a friend who has a few STR in the area. According to my friend he feels AirDNA is not totally accurate as his rentals have always out performed what AirDNA predicts

    With that being said, are there any other suggestions on how to predict this in order to really accurately analyze the deals I'm looking at?

    Additionally, any advice for a STR newbie would be appriciated!

    @Norah Whitten, that is exactly the hard part. With investors I’ve worked with, I like to look at the first year separately from what the property might do once it is established.

    I would use the established comps as a guide, but I would not assume you will match their occupancy or pricing right away. I'd build a more conservative first-year number that gives you room to learn the market, build reviews, adjust pricing, and figure out which guest demand actually works best for the property. I would also run the deal with a slower STR year and see whether a mid-term or long-term rental could still carry it if needed. I actually think the fact that you are questioning the comps instead of forcing the numbers to work is a very good sign.

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