Despite restrictive measures by many local authorities in recent years, buying an Airbnb investment property remains the best real estate investment strategy in the US housing market. Investing in a vacation home gives both beginner and experienced investors not only flexibility but also a higher rate of return. Similar to traditional rentals, the success of an Airbnb business depends first and foremost on the location of the property. In 2020 the Florida real estate market continues to be a top place for short term rentals due to the general lack of Airbnb legal restrictions and the strong demand from tourists and business travelers. If you are a beginner real estate investor and have no idea where to start, we show you what Airbnb occupancy rate you can expect in Florida in 2020. As we will elaborate on later in this article, the Airbnb occupancy rate is one of the most important determinants of return on investment for this rental strategy.
Average Airbnb Occupancy Rate by City in Florida 2020
Let’s take a look at the Airbnb occupancy rate which you can expect in 50 of the best real estate markets for buying an Airbnb income property in Florida. While many new real estate investors wonder “What’s a good Airbnb occupancy rate in real estate investing?”, there’s no exact answer to this question. However, generally speaking, a value of 50% or higher is considered good. Obviously, the higher the occupancy rate of your short term rental property, the higher your return on investment.
Based on Mashvisor’s nationwide real estate market analysis, these are the Airbnb occupancy rates by city which investors can expect in the Florida housing market in 2020:
- Cocoa Beach: 66.8%
- St. Petersburg: 66.6%
- Key West: 66.2%
- Augustine: 65.1%
- Orlando: 63.8%
- Delray Beach: 61.3%
- Palm Bay: 61.2%
- Bradenton: 60.7%
- Fort Walton Beach: 59.7%
- Panama City Beach: 59.4%
- Fort Myers Beach: 59.4%
- Fort Lauderdale: 59.3%
- Fort Myers: 58.7%
- Miami: 58.6%
- Miami Gardens: 58.1%
- Boca Raton: 58.0%
- Cape Coral: 57.9%
- Clearwater: 57.5%
- West Palm Beach: 57.4%
- Pensacola: 57.1%
- Daytona Beach: 57.0%
- Marco Island: 56.8%
- Tampa: 56.5%
- Miami Beach: 56.3%
- Panama City: 55.7%
- Port St. Lucie: 55.7%
- Lakeland: 55.6%
- Vero Beach: 55.5%
- Jacksonville: 55.1%
- Crystal River: 55.0%
- Lake Worth: 54.1%
- Destin: 53.9%
- Pompano Beach: 53.6%
- Ocala: 53.5%
- Madeira Beach: 52.8%
- Naples: 52.7%
- Deerfield Beach: 52.4%
- Bonita Springs: 52.3%
- Sarasota: 51.3%
- Key Largo: 52.2%
- Tallahassee: 49.9%
- The Villages: 49.9%
- Coral Gables: 49.9%
- Palm Coast: 49.5%
- Gainesville: 48.7%
- Port Charlotte: 48.2%
- Pete Beach: 47.6%
- New Smyrna Beach: 47.4%
- Punta Gorda: 46.8%
- Palm Beach: 46.8%
Note: Real estate investors aspiring to become Airbnb hosts in 2020 should keep in mind that while, overall, Florida short term rental properties face less legal restrictions and limitations than those in other markets, various Airbnb laws and regulations are present in some locations. For example, only primary residences can be rented out on Airbnb and other similar homesharing platforms in the Miami real estate market. To avoid problems with the local authorities and assure the legality of your Airbnb investment property, study the local short term rental laws of the market of your choice.
Analysis of the Airbnb data above reveals that the city-level Airbnb occupancy rate in the Sunshine State ranges from 46.8% in the Palm Beach real estate market to 66.8% in the Cocoa Beach real estate market. The median value in these 50 best places to invest in real estate to rent out on a short term basis is 55.5%. A total of 8 Florida cities from the list above have an occupancy rate for vacation home rentals in the 60s, 32 – in the 50s, and 10 – in the high 40%. As a result, real estate investors can conclude that Airbnb occupancy rates in Florida are generally high, which makes this state one of the top locations to invest in Airbnb in 2020.
To find out what rates to expect in the rest of the US housing market this year, read What Airbnb Occupancy Rate Can You Expect in 2020?
Airbnb Data Methodology
Whenever they look at any real estate data, savvy investors should identify and check the source and its credibility. All the Airbnb occupancy rate data presented in the previous section of this article has been computed by Mashvisor’s investment property calculator. Mashvisor obtains data directly from Airbnb.com which means that all short term rental market analysis is based on the recent performance of actual Airbnb rental listings in an area. Mashvisor’s Airbnb data covers the past 12 months of active Airbnb listings in a given neighborhood or city.
With regards to Airbnb occupancy rate data in specific, our real estate investment app looks at the calendars of all Airbnb listings which have been active in the last 12 months. Our software tools differentiate between days when Airbnb hosts had their calendar open for bookings and when they had marked their vacation home as unavailable. The occupancy rate is then calculated by Mashvisor’s rental property calculator as the proportion of total bookings over the number of days when an Airbnb rental property was available for booking.
Furthermore, to assure accuracy, our Data Team compares our estimated Airbnb occupancy rate values to the performance of similar listings in the area by talking to real Airbnb hosts.
Related: Where Can You Find Airbnb Occupancy Rate for Real Estate Investing?
The Importance of Airbnb Occupancy Rate in Real Estate Investing
As any real estate investor knows – no matter how new or experienced he/she is – return on investment is determined by the property price, the one-time and recurring expenses, and the rental income (or Airbnb income in the case of investors in short term rentals). When it comes to owning an Airbnb investment property, the rental income is a function of the Airbnb daily rate and the Airbnb occupancy rate. After all, the more days you have your vacation home rented out in a month, the more money you will make, all else equal. All this means is that the occupancy rate is one of the most important factors for high return on investment in short term rental real estate investing, whether you look at the cash on cash return or cap rate.
Even though not all Airbnb rental properties in a location perform the same, the Airbnb occupancy rate by city is an excellent indicator of how you can expect an individual property there to behave. Needless to say, location is crucially important for how many Airbnb guests you can attract, and the Florida real estate market is a leading state in the US short term rental industry. With millions of tourists coming to enjoy the beautiful weather, the astonishing beaches, and the limitless entertainment opportunities each and every year, the Sunshine State benefits from one of the highest Airbnb occupancy rates in the US housing market in 2020 and beyond.
So, if you are thinking of starting an Airbnb business in 2020 or expanding your investment portfolio, give Florida cities some serious consideration.
How to Find the Expected Occupancy Rate of Any Florida Short Term Rental Property
While location is a key determinant of any metric in real estate investments – including the Airbnb occupancy rate – smart real estate investors cannot assume that any vacation home will have the same value as the average for the local market. Other important factors comprise of the neighborhood, the property type (single family home, condo, townhouse, or multi family home), the marketing strategy and platform (Airbnb, Vrbo, HomeAway, etc.), the pricing strategy and daily rates, the number of previous Airbnb reviews, and more.
Having heard this, new real estate investors should not worry about all the investment property analysis which they need to conduct before buying an Airbnb income property which can generate a high occupancy rate. Instead, all they have to do is to use Mashvisor’s Airbnb profitability calculator to access readily available analysis of any property in the Florida real estate market as well as the rest of the US housing market.
To begin with, if you’ve already selected your preferred location from the Florida cities listed above, you can check out Mashvisor’s heatmap. This real estate investment software tool will show you a color-coded visual representation of neighborhoods in this market with a high Airbnb occupancy rate (marked in green) and a low Airbnb occupancy rate (market in red). You could also look up areas with high Airbnb income, high Airbnb cash on cash return, and low listing prices. Below you can have a look at the heatmap view of the Tampa real estate market, where both owner-occupied and non-owned occupied short term rentals are currently legal.
Related: Airbnb Rentals: Finding Income Properties with a Heatmap
Once you’ve chosen an area with an above-average occupancy rate for vacation homes, you can search for rental properties for sale there within your budget and based on your other requirements such as a minimum Airbnb cash on cash return and a minimum Airbnb cap rate or also minimum Airbnb income.
For each one of these investment properties for sale which match your real estate investing criteria, you can access ready rental property analysis including all measures and metrics you need in order to make a smart, data-based investment decision. All data comes directly from Airbnb.com and the MLS, and each investment property analysis is based on the performance of Airbnb rental comps of the same type within the area. Mashvisor’s real estate investment tools have turned a 3-month research process into 15 minutes.
Related: 5 Best Real Estate Investment Tools for 2020
To start looking for profitable Airbnb investment properties in Florida or any other US housing market, sign up for a free 7-day trial now.
How to Enhance the Occupancy Rate of Your Airbnb Investment Property
Buying an Airbnb investment property with a certain estimated occupancy rate does not mean that you – as an Airbnb host – cannot do anything to increase the number of days for which your vacation home gets booked. As mentioned above, the Airbnb occupancy rate depends on a number of factors, and real estate investors have – at least some – control over them. Here are a few tips and tricks how to optimize your occupancy rate and consequently return on investment in 2020:
1. Set up a flexing Airbnb pricing strategy
One of the best things about the Airbnb investing business – as opposed to other real estate investment strategies – is the ability to ask for a different daily rate depending on demand. Savvy Airbnb hosts can use this fact to optimize their nightly rate for weekdays vs. weekends, summer vs. winter, and other high and low seasons in their specific location. This, in turn, will help them attract the maximum number of Airbnb hosts throughout the year. As a beginner real estate investor, you should keep in mind that lowering your Airbnb daily rate at a few dollars below the average in your neighborhood can help you get your vacation home rental fully booked as you take hosts away from your more established competitors. The lower nightly rate will be more than compensated for by the high Airbnb occupancy rate, leading to a better Airbnb income.
2. Offer more extras than other Airbnb hosts in the neighborhood
One way to keep your daily rates high while also scoring an above-average Airbnb occupancy rate is to provide your hosts with more amenities than other investors in the area. Make sure to highlight those in your property description on the Airbnb website as they will attract more bookings. Furthermore, going the extra mile will help you generate positive Airbnb reviews down the road, which are another factor for having your property booked more frequently.
3. Optimize your listing on Airbnb
There are many things you can do as an Airbnb host to make your rental property stand out from the competition online. A few things include:
- Posting professional photos of your vacation home which emphasize all its best qualities
- Writing an attractive – and truthful – description
- Offering an experience rather than just a space
- Listing all extras and amenities which your short term rental property provides
4. Get positive Airbnb reviews
The vast majority of people look at the reviews which previous guests have given to a vacation home rental before deciding whether to book it or not. That’s why Airbnb properties with a large number of favorable reviews enjoy a significantly higher Airbnb occupancy rate. To attract positive reviews, here are a few things you can do:
- Always write only 100% accurate descriptions without exaggerating the qualities of your property
- Leave a small – but thoughtful – welcoming gift for your guests
- Be fully available to address any problem immediately or hire a professional property manager to do that for you
- Follow up with your guests after they leave to thank them for their visit, to invite them again, and to proactively ask for a review of their experience in your vacation home
5. Become an Airbnb Superhost
Last but not least, you should work towards being an Airbnb Superhost. This status gives your Airbnb profile a special Superhost badge which comes with many important benefits, including getting more bookings than the average. That’s a sure way to maximize your Airbnb occupancy rate. The requirements for becoming an Airbnb Superhost in 2020 are:
- Completing 10 reservations or more per year
- Responding to questions within 24 hours at least 90% of the time
- Less than 1% cancellation rate
- Minimum rating of 4.8% over the last 365 days
If you’d like to explore Airbnb investment opportunities in other markets, read 20 Most Profitable Airbnb Locations in 2020: Cash on Cash Return.
Now you know what Airbnb occupancy rate by city you can expect in the Florida real estate market and where to focus your property search for the highest values. The next step in the process of making money as an Airbnb host is to start analyzing Airbnb for sale investment properties in your preferred location. To do that, sign up for a free trial of Mashvisor to gain access to all our real estate investing tools now.