Should real estate investors consider investing in Airbnb Miami Beach in 2022? Before reaching a decision, let’s go over the crucial numbers.
Table of Contents
- Florida Real Estate Market Forecast: 2022
- Why Should You Invest in Airbnb Miami Beach?
- Top 5 Miami Beach Neighborhoods to Invest in
- Tourist Attractions in Miami Beach
- Tips for Investing in Miami Beach Airbnb
- Summing Up
In case you weren’t aware, the Miami real estate market holds the title of the second-largest housing industry in the entire US—which is a pretty big deal from a realtor’s perspective.
And with such a reputation, it’s only natural that the market attracts thousands of prospective and interested real estate investors year after year.
The one type of investment that stands out here, though, is Airbnb rentals.
Miami, and its neighboring resort city Miami Beach, have performed well in terms of seasonality, providing investors with more than generous income streams.
Some of the questions that are on everyone’s mind now are:
Is it worth investing in Miami Beach Airbnb rentals in 2022? What are some of the hotspots of this real estate market? And how can you make the most of your investment?
To get the answer to these and many more questions, you’ll have to stick with us until the end of this blog post.
Florida Real Estate Market Forecast: 2022
The first thing to focus on when assessing the profitability of your investment is the forecast of the real estate market in general.
And this time, it’s the assessment of investment properties in Florida.
If we look back at the economic breakdown that occurred in 2008 and monitor the progress of certain real estate markets in the US, we can say with certainty that the Florida real estate market remained in surprisingly good standing.
In order to give you a concrete answer, we should focus on certain factors that directly affect the progress of any housing market.
For starters, there’s evident population growth. In Florida’s case, the number of residents increased by an incredible 2.7 million.
And exactly why is this good for the investor?
Well, because investors can expect new guests every year and can have confidence in their long- and short-term rentals being occupied.
The next thing we need to pay attention to is the economy and job market. That is crucial for both the investors and the residents that occupy the investment property. In both cases, one should choose a market that’s advanced enough to enable profit-making.
Luckily, the Florida market witnessed substantial growth because it is the perfect location for a rental business—and other kinds of business, as well. Also, given the extensiveness of this US state, job opportunities are anything but lacking.
So, investors can certainly anticipate profits if they choose to stick to this market.
Related: Is Airbnb Profitable in 2022?
Why Should You Invest in Airbnb Miami Beach?
Okay, it’s time to go over the reasons why you should invest in an investment property in Miami Beach FL.
Here are a couple of “motivators” to get you started:
As we finally emerge from the pandemic and slowly return to our normal daily life, the desire for traveling and tourism is once again becoming one of the major motivators.
And it’s a well-known fact that Miami is a tourist hotspot.
Before COVID-19 hit, Miami Beach rentals were packed. Fortunately for tourists—but mostly investors in real estate—this will continue to be the case in 2022, too. In addition to vacation homes for sale, Miami Beach offers tons of well-equipped apartments for rent.
This international location offers many attractions to its visitors of all age groups—and Miami Beach is just the starting point.
We’ll get around to mentioning the rest in a few minutes.
Strong Renter’s Market
If you’ve firmly decided to invest in Miami Beach apartments for rent, the info below may be like a green light to you.
The Miami real estate market is a strong renter’s market. Here’s the data that turns this into an actual fact:
Almost 70% of Miami’s residents are renters. Meanwhile, the resort city has more than 3,000 rentals.
So, investing in Miami Beach Florida Airbnb is more than a smart decision on your side—with a well-developed strategy, of course.
One of the main reasons why this is such a strong renter’s market is that a vast number of (mostly younger) people move there because of work. Some stick around only for the duration of the season, while for others, this decision turns into a long-term work contract.
Another good reason for investing in a Miami Beach condo, for example, is that it’s not just a strong renter’s market. It’s an international hotspot, as well.
Sure, you’ll see people coming in from smaller towns to spend their summers here, but that’s just a small percentage of what’s going on here.
You won’t just see Americans coming to Miami Beach.
There’s a great chance that you’ll welcome tourists from all over the world, and their reasons for choosing this hotspot will either be business- or leisure-related.
Even though condos and vacation rentals are the types of investments that pay off the most in this area, some real estate investors even consider investing in a Miami Beach house and succeed in doing so.
That’s perfect for someone who’s financially stable enough to come to Miami Beach and finally live that lavish lifestyle. There’s a market for them, as well.
Is It Legal to Invest in Airbnb Miami Beach?
In short, yes, Miami Beach is generally Airbnb-friendly. However, there are still some regulations you’ll have to respect.
First and foremost, you’ll need a license from the State of Florida and the needed regulation from the Florida Department of Revenue.
Next, if you are planning on leasing any type of accommodation for a period of six months or less, you’ll need to report that and register for a so-called Tourist Tax Account.
As for advertising the property that you’ll be leasing, investors need to obtain a Certificate of Use, which costs around $36.
Depending on the size of your property, there’s a limit of two people per bedroom. So, you’ll need to pay attention to that, as well.
Violations of the laws regarding properties will result in penalties. We advise all investors and landlords to investigate the rules and regulations of their district in more detail.
Top 5 Miami Beach Neighborhoods to Invest in
Slowly but surely, we’re moving further in our guide on how to invest in Miami Beach Florida Airbnb, and generate a high income.
With that said, we’ve done our part of the homework—and the numbers are in. Here are the top five Miami Beach neighborhoods to invest in based on Airbnb cash on cash return according to Mashvisor’s latest report:
- Median Property Price: $338,600
- Average Price per Square Foot: $387
- Days on Market: 171
- Monthly Airbnb Rental Income: $3,595
- Airbnb Cash on Cash Return: 5.32%
- Airbnb Cap Rate: 5.46%
- Airbnb Daily Rate: $331
- Airbnb Occupancy Rate: 55%
- Walk Score: 68
2. Isle of Normandy
- Median Property Price: $530,544
- Average Price per Square Foot: $435
- Days on Market: 93
- Monthly Airbnb Rental Income: $4,054
- Airbnb Cash on Cash Return: 5.10%
- Airbnb Cap Rate: 5.24%
- Airbnb Daily Rate: $265
- Airbnb Occupancy Rate: 52%
- Walk Score: 33
3. Flamingo Lummus
- Median Property Price: $495,115
- Average Price per Square Foot: $620
- Days on Market: 121
- Monthly Airbnb Rental Income: $3,143
- Airbnb Cash on Cash Return: 2.94%
- Airbnb Cap Rate: 3.02%
- Airbnb Daily Rate: $223
- Airbnb Occupancy Rate: 53%
- Walk Score: 92
4. La Gorce
- Median Property Price: $896,778
- Average Price per Square Foot: $714
- Days on Market: 196
- Monthly Airbnb Rental Income: $5,124
- Airbnb Cash on Cash Return: 2.26%
- Airbnb Cap Rate: 2.30%
- Airbnb Daily Rate: $349
- Airbnb Occupancy Rate: 54%
- Walk Score: 7
5. Belle Isle
- Median Property Price: $649,577
- Average Price per Square Foot: $623
- Days on Market: 97
- Monthly Airbnb Rental Income: $3,561
- Airbnb Cash on Cash Return: 2.10%
- Airbnb Cap Rate: 2.15%
- Airbnb Daily Rate: $250
- Airbnb Occupancy Rate: 51%
- Walk Score: 69
Tourist Attractions in Miami Beach
One of the most notable perks of investing in apartments for rent Miami Beach is that it’s, without a doubt, a major tourist hotspot. Seasonal attractions seem to be around every corner.
Here are some that will attract a huge number of tourists.
The title of Florida’s number one attraction definitely goes to the breathtaking Miami Beach. It’s mainly an entertainment area—but also a great place to relax and catch that summer tan.
Art Deco Historic District
After spending a fair share in the sun, you can continue to the Art Deco District—another destination that’s definitely worth taking the time to visit.
One trip here will bring your guests back to the olden days of the 1930s and 40s. It is also a perfect example of a South Beach neighborhood.
Tourists can even stay for a couple of nights since most of the buildings function as motels, too.
Further down the south end is another place for relaxation and enjoying the crystal blue waters—the South Beach.
Similar to Miami Beach, this is a destination where tourists go to see—and be seen. Parties, drinks, entertainment—everything is within reach—and tourists definitely know how to make use of that.
Beaches might be in the foreground, but there is no reason why your guests shouldn’t spend a few hours (or even days) of their vacation roaming around the Bayside Marketplace.
This destination offers more than 120 shops for tourists, restaurants, and cafes to just sit in and enjoy the weather (and the people). It’s located along the waterfront—and there’s even a water taxi service.
As for tourists who have Miami on their family travel list, they shouldn’t miss the opportunity to take their kids to the Miami Seaquarium.
This institution is one of the better equipped and most diverse in the country. It offers animal shows, and kids get to swim with dolphins, interact with penguins, and play with baby seals.
It’s definitely an adventure for the entire family.
These are just a few of the many examples of locations that will attract tourists and increase your success if you’re set on investing in Airbnb Miami Beach Florida.
Tips for Investing in Miami Beach Airbnb
Whether you are a beginner investor and investing in Airbnb in Miami Beach is the start of your career or you’ve been in the business for a long time, it won’t hurt to go through a few tips.
Here’s some advice that should stick with you throughout your investing career.
Decide on the Optimal Rental Rate
Once you’ve completed the buying process and are renovating your property as needed, you need to determine the optimal rental rate.
Now, you should be extra careful with this:
You don’t want to set a rent that’s too low to make any income. Also, you don’t want to strive too high and set a number that will only drive away potential tenants.
Deciding on appropriate rent rates depends on many factors, starting with your investment. It may happen that at the beginning, your rent will be a little above average to secure the initial profit. After that, you can reduce it—and adjust it to the conditions.
Also, your rent largely depends on who your target renters are:
If you are targeting incoming tenants for the purpose of employment, then a small raise can’t hurt. On the other hand, if they’re students, you’ll most likely have to lower your rates.
Consider Hiring a Property Manager
At first, investing in Airbnb Miami Beach FL might seem like a piece of cake. However, many investors take the initial success for granted and go on thinking that it’ll always be that easy.
Unfortunately, the role of an Airbnb host involves a lot more than merely listing your property online and targeting potential tenants. You’re required to be on the field more often and take care of day-to-day obligations regarding the maintenance of your property.
One solution is hiring a property manager. These professionals are in charge of things such as maintaining the property, conducting inspections, dealing with administration, etc.
Only when you agree to this will you see how much you actually needed it—especially if you decided to invest in multiple properties at once.
Sure, you’ll have to pay them a percentage. But it’ll take a load off your back and make your job much more enjoyable and easier.
Rely on Investment Tools
Whether it is investing in condo rentals in Miami Beach or in any other real estate market in the US, it’s imperative to use valid and up-to-date data.
In this regard, our sincere advice would be to put the traditional method of acquiring info and researching the market behind you and utilize investment tools that are at your disposal.
Using software analytics to calculate the profitability and other key metrics of your potential investment is the most reliable way of knowing what you are up against—and how you can work on building a profit-making strategy.
We’ve reached the end of the guide to investing in Airbnb Miami Beach in 2022. So far, we have discussed market forecasts, rules and regulations, profitable neighborhoods, and even tourist attractions.
Let’s see what we’ve learned.
Investing in Airbnb in Miami Beach is legal, but you’ll have to obtain a license and take care of the paperwork first. Also, we advise all future hosts and investors to look into the rules and regulations in more detail so as to avoid any trouble.
The forecast for the Miami Beach market looks good. Not even the pandemic could bring this strong renter’s market to its breaking point:
It remains the second-largest housing industry, an international hotspot, and a top offer for Airbnb investors.
What’s important to mention is that one of the biggest advantages of investing in such places is highly developed tourism and countless places for tourists to spend their days soaking up the sun and the beauty of Miami Beach and creating new memories.
To add to that, we’ve outlined the five most profitable neighborhoods.
Last but not least, when choosing this career path, pay attention to setting the rent rate at an appropriate price, use investment tools—and consider hiring a property manager to help with your day-to-day obligations.
To help you with your investment strategy and any other dilemmas you might have during your investment journey, consider using Mashvisor’s tools.
Click here to sign up for a 7-day free trial of Mashvisor today, followed by 15% off for life.