Louisville agent here, mostly investors. The question I keep getting from out-of-state buyers right now: Airbnb or midterm rental? Here's how I walk people through it, and I always start in the same place. Permission first, spreadsheet second.

The permit side. Louisville Metro has allowed short-term rentals since 2015, but every one has to be registered, and it's $250 a year. If you don't live in the home, most residential zones also need a conditional use permit on top of that. That's a public process, not a form. Old Louisville has its own carve-out. Some of the small cities inside Jefferson County ban them outright. Condo boards and HOAs add their own rules. Stays of 30 days or longer fall outside the short-term rental ordinance entirely, which is a big part of why midterm appeals to owners who don't want the permit process.

So check zoning, the city, and the HOA or condo docs before you write the offer, not during the inspection window. That's the part I'd hate for anyone to learn the expensive way.

The demand side. Kentucky had a record 2025: 81.1 million visitors who spent $10.4 billion, the fourth straight record year. The Bourbon Trail drew 2.7 million visits. Louisville also locked in a ten-year deal to keep its two big fall music festivals, so the visitors aren't all showing up Derby week.

The revenue side, and this is where I'd be careful. AirDNA counts about 3,215 active short-term listings in Louisville as of August, down about 20% from a year ago, and puts the average listing at about $40,000 a year, $218 a night, 56% occupancy. Another tracker, AirROI, shows about $30,700 a year and 38% occupancy. Same city, two different answers. Underwrite the low end and let the high end be a pleasant surprise.

One real example. A furnished three-bedroom near downtown, run hands-off by owners who blocked the calendar whenever life got busy, grossed about $36,300 in 2024 (115 nights, 31% occupied) and about $38,900 in 2025 (172 nights, 47% occupied). They missed repricing Derby weekend, which they figure cost them about $4,500. That's gross, not profit, from owners who weren't chasing bookings.

The midterm side. Norton Healthcare has more than 18,600 employees and is Louisville's second-largest employer. UofL Health runs nine hospitals, and Baptist Health has a big campus here. Kentucky is in the Nurse Licensure Compact, so a nurse with a multistate license can start working here without applying for a separate Kentucky license. The travel contracts I looked at run 13 to 14 weeks, which is a furnished place for about three months. To be fair, the demand is hospitals refilling units more than a statewide shortage. That's steady, not a spike, and for a landlord steady is fine.

The tax angle is why a lot of high earners look at these, and the average-stay rules are a real dividing line between the two strategies. That's a CPA conversation, not mine. I'm a realtor. What I can tell you is that a great tax plan on a property you can't legally run is worth zero.

How I'd decide:

• If the deal only works at Airbnb numbers, confirm the permit path first and underwrite at the low end of the revenue range.

• If you want a fallback, buy where a regular long-term lease covers the payment, then layer furnished stays on top.

• If you go midterm, think short drive to the hospitals, fully furnished, 30-plus-night leases, and a calendar you actually keep open.

Two questions for the group. For anyone running both in the same market, which came out ahead after cleaning, furnishing and turnover: short stays or 30-plus nights? And if you've been through a conditional use permit for a non-owner-occupied short-term rental anywhere, how long did it take start to finish?