Whether you’re looking for a long-term rental investment or a short-term income property, Florida has a selection of great choices for investing in real estate; and today, we want to explore an often-neglected market and answer the question: should you invest in an Airbnb rental in Dunedin, FL, in 2022?
Before even making the decision to buy a property, you would first want to know why investing in an Airbnb in Dunedin, FL is such a lucrative idea.
In this article, we’ll explore the city of Dunedin, FL, to see how it compares to other cities in Florida in terms of the lifestyle it offers, why people are moving in, and how its real estate market has been shaped in the past couple of years.
Ultimately, we will be talking about how you can take advantage of the current market trends by investing in an Airbnb rental in Dunedin FL, and what are the tools that can help you seize the opportunity in the fastest and easiest way possible.
Dunedin, FL – COVID-19 Market Trends
Just like most other real estate markets across the US, the real estate market in Dunedin going into 2022 was shaped by COVID-19 and its drastic impact on the housing market.
To know why Airbnb in Dunedin FL is performing the way it is, we must understand these market trends:
- Prices are up – In 2021, the housing market in Dunedin saw a sharp increase in the median sale price of properties which has amounted to more than 34% year-over-year. This trend was beginning to slow down in December 2021, but it is not expected to stop anytime soon.
- Demand is high – The event leading to the increased prices was the increased demand for houses which began in 2020 with the start of the COVID-19 lockdowns. As employees were asked to work remotely, more and more people wanted to purchase a secondary home in suburban and rural areas.
- Supply shortage – As a consequence of the increased demand in 2020, coupled with the trade restrictions on most construction materials, the housing market suffered from a lack of new homes being built, which further exacerbated the situation and make it much harder for the inventory to meet the demand. This made prices grow even faster in 2021.
All of these trends led to the current market status in Dunedin, FL, where the market has become very competitive, with an 81 Compete Score from Redfin.
In 2022, we’re seeing homes getting multiple offers, average homes are selling for around the listing price in around 9 days, while properties on high demand are selling for about 3% higher than their listing price and are selling in around 4 days.
Dunedin FL Real Estate Market
What does the Dunedin Florida real estate market look like in January 2022?
According to Mashvisor’s data, this is how the real estate market is performing in terms of prices, rental income for both traditional and short-term rental strategy, the return on investment that you can expect, and the occupancy rate which can be seen as an indicator of Airbnb demand in Dunedin FL:
- Median Property Price: $557,575
- Property Size: 344.53 Sq. Ft.
- Traditional Rental Income: $2,045
- Traditional Cash on Cash Return: 2.59%
- Airbnb Rental Income: $3,203
- Airbnb Daily Rate: $141
- Airbnb Cash on Cash Return: 3.4%
As you can see from this data, the market is looking solid for landlords and renters.
While the median home prices have increased drastically in the past two years, the market is still relatively affordable compared to other Florida real estate markets.
In terms of its rental income, Dunedin is one of the most stable rental markets in the Florida housing market for both long-term and Airbnb income properties.
Having a backup plan is very important in real estate investing. And when it comes to investing in Airbnb in Dunedin, FL, you can always feel safe because you can convert the property to a traditional rental for lower risk and management while still enjoying a solid positive cash flow.
But the Airbnb rental income and return on investment is what looks really good and has been increasing recently.
With a bit of property management and a good location for an Airbnb in Dunedin FL, you can get an even higher return on investment, so it is a great way for making money in real estate.
Finally, the size of the property you’re getting for the price makes it even more lucrative as you can utilize this space in creative ways to generate even more incoming from your Airbnb rental.
So, now that we know how the real estate market is performing, let’s talk about the lifestyle that the city offers and why it appeals to the lifestyle of short-term renters and increases the Airbnb demand in Dunedin, FL.
What’s It Like to Live in Dunedin, FL?
There are many things that make Dunedin FL such a great city to live in or to travel to for a vacation.
Firstly, the city has a low crime rate and is considered 57% safer than most U.S cities. The city also has a growing local economy and plenty of work opportunities.
In recent years, the local economy in Dunedin FL has strengthened, and work opportunities have increased significantly. It is predicted that work opportunities in the city will increase by around 40% in the next ten years.
This means that plenty of people are moving into the city to experience its growth in its local economy, as well as to try to profit off of the recent developments in its economy.
When it comes to Airbnb dwellers in Dunedin FL, there are plenty of tourist attractions that your Airbnb guests will be coming for:
Summer Days on the Beach
Home to the sandy beaches of Honeymoon Island and Caladesi Island, Dunedin is known for its warm weather and sunny days at the beach where you can enjoy your time alone or with company.
The white sandy beaches of Dunedin also offer outdoor activities such as hiking, kayaking, shell hunting, or bird watching. A popular activity among tourists is going on the Nature Trail for a hiking trip where you might see bald eagles and ospreys among other animals.
Water activities include a ferry ride to Caladesi Island or kayaking and exploring the Pelican Cove.
The ferry ride to Caladesi Island is especially popular due to the possibility of catching a glimpse of dolphins in the waters near the island.
Another often-neglected advantage of having an Airbnb in Dunedin FL is the dog-friendly beaches where you can spend time with your best friend with four legs.
The Amazing Food
Not only does Dunedin FL have all the kinds of food that you would expect to see in restaurants, pubs, and breweries in other cities, but it also has amazing fresh food that other cities don’t.
Fridays and Saturdays are known for their outdoor farmers’ markets where people can buy fresh produce, bread, honey, and meat in Pioneer Park. Vendors and stalls sell local handicrafts and wares as well.
One of the reasons why many guests want to stay in an Airbnb in Dunedin FL is that the city is home to the oldest microbrewery in Florida – the Dunedin Brewery. This means that the city offers locally crafted fresh beer and ale that you can enjoy during the evenings in the city’s pubs and bars.
Overall, the local food scene in Dunedin grows quickly on people, and there is a high chance that they would come back for more of this unique delicious experience.
Other Attractions and Recreational Activities
Dunedin, Florida, offers a wide range of cultural and recreational activities that will suit your guests’ every desire.
Your guests can travel back in time by visiting the Dunedin History Museum, which includes the history of the town settlers, citrus, and the railroad industries which have shaped the city. Beatles fans will enjoy going to The Penny Lane Beatles Museum.
Art lovers will enjoy the numerous art exhibitions and galleries that the city offers, such as the Stirlings Art Studio and Gallery which consists of ten art studios that are always rotating and which offer the chance to meet the maestro behind the canvas for guests who planned their visit beforehand.
There are plenty of other activities that Airbnb guests would enjoy in Dunedin FL, such as the Dunedin Marina or the Fred Marquis Pinellas Trail of Dunedin.
How to Find an Airbnb Investment Property?
Airbnb in Florida is popular, so it’s relatively easy to find an Airbnb income property for sale.
However, if you want to buy an Airbnb in Dunedin as a real estate investment, then you want to find the best-performing investment property that has a high potential for Airbnb profit.
This is where Mashvisor comes in!
Mashvisor is a real estate investment platform that’s designed to help real estate investors find profitable properties for sale based on actual data projections.
The platform includes a number of great tools that can help you find your next great investment with a high Airbnb return on investment using innovative and effective tools such as:
Investment Property Finder
The Investment Property Finder is an interactive map tool that comes with an array of filters to help you narrow down your search when it comes to finding the best traditional or Airbnb rental in Dunedin FL.
By showing you each property on the map along with their details, including:
- Property price
- Traditional and Airbnb rental income
- Traditional and Airbnb cash on cash return
- Occupancy rate
And by using filters, you can narrow down your search based on:
- The property price range
- Cash on cash return
- Cap rate
- Property type
- Number of rooms
- Property Status (foreclosure, for sale, pending, or sold)
- Year built
Finally, the tool also features a heatmap function that will give you visual indicators of each area and neighborhood’s performance based on price, rental income, or return on investment for traditional and Airbnb rentals separately.
Another great tool that you will need for finding a great Airbnb in Dunedin FL in 2022 is the Neighborhood Analytics tool.
This tool lets you analyze each neighborhood to see the average performance of traditional or Airbnb rentals there, as well as the average occupancy rate, property price, and other metrics.
This tool is amazing when it comes to identifying the specific area where you want to invest and for comparing properties with one another.
In fact, the tool will automatically give you neighborhood comps that compare the performance of each property with other similar properties in that neighborhood, including properties that are no longer for sale, in order to give you accurate projections of how each property is expected to perform in the future.
All of these tools can help you tremendously when it comes to finding a great investment property that you can use either as a traditional or an Airbnb rental in Dunedin, Florida.
Investing in an Airbnb in Dunedin FL can be a lucrative investment that is likely to pay off in the long run.
Due to its attractive nature, the city is growing at a fast pace, and the real estate market is growing with it. While the cost of living is still low, property prices are on the rise – making it a perfect time to purchase a second home or an investment property there.
If the worst happens and your short-term rental income becomes a negative cash flow, you will always have a fallback plan with traditional rentals as their market is steady and profitable in Dunedin FL, and is expected to remain that way for the foreseen future.
And of course, don’t forget to use Mashvisor as your real estate investment tool as it will help you tremendously on your journey and throughout all steps of your investment.