Best Places to Buy an Investment Property for Airbnb Rental Income

Real estate investing is a great way to make money, but in order to be a successful real estate investor, you have to know the best places to buy an investment property.
Whether you go for traditional rentals or Airbnb rentals, location is a key factor determining your return on investment and your profitability. If you have decided to invest in Airbnb properties, then you should know all the top places to buy an investment property in the US housing market for Airbnb rental income. After all, rental income is how real estate investors make money from rental properties.

Before we start, let us just say that the data we use to rank the top locations to buy a rental property in the current US housing market is computed by Mashvisor’s rental property calculator. Mashvisor’s rental property calculator is the ultimate real estate investing tool which uses traditional as well as predictive analytics to provide you with reliable estimates of the rental income, cash on cash return, cap rate, and occupancy rate for both traditional rentals and Airbnb rentals.

To learn about the many benefits of using an investment property calculator when investing in real estate, read “Investment Property Calculator For Analyzing Real Estate Investments”.

To start your 14-day free trial with Mashvisor and subscribe to our services with a 20% discount after, click here.

But now, let’s jump right into the top places to buy an investment property for Airbnb rental income in the 2018 US housing market:

Best Places to Buy an Investment Property for Airbnb Rental Income #1: Playa Hermosa, CA

Airbnb Rental Income: $9,000
Airbnb Cash on Cash Return: 4.3%
Traditional Rental Income: $6,130
Traditional Cash on Cash Return: 2.1%
Median Property Price: $1,350,000

Best Places to Buy an Investment Property for Airbnb Rental Income #2: Boonville, CA

Airbnb Rental Income: $8,970
Airbnb Cash on Cash Return: 4.6%
Traditional Rental Income: –
Traditional Cash on Cash Return: –
Median Property Price: $1,349,000

Best Places to Buy an Investment Property for Airbnb Rental Income #3: Malibu, CA

Airbnb Rental Income: $8,050
Airbnb Cash on Cash Return: 1.5%
Traditional Rental Income: $6,630
Traditional Cash on Cash Return: 1.1%
Median Property Price: $2,300,000

Best Places to Buy an Investment Property for Airbnb Rental Income #4: Pebble Beach, CA

Airbnb Rental Income: $7,310
Airbnb Cash on Cash Return: 1.9%
Traditional Rental Income: $3,510
Traditional Cash on Cash Return: –
Median Property Price: $1,785,000

Best Places to Buy an Investment Property for Airbnb Rental Income #5: Shorewood Hills, WI

Airbnb Rental Income: $7,150
Airbnb Cash on Cash Return: 0.7%
Traditional Rental Income: $1,800
Traditional Cash on Cash Return: –
Median Property Price: $2,000,000

Best Places to Buy an Investment Property for Airbnb Rental Income #6: Menlo Park, CA

Airbnb Rental Income: $7,110
Airbnb Cash on Cash Return: 0.9%
Traditional Rental Income: $5,410
Traditional Cash on Cash Return: 0.4%
Median Property Price: $2,538,000

We know what you must be thinking by now: This blog should have been titled “The Top Places to Buy an Investment Property for Airbnb Rental Income in California”. Or even better: “The Most Expensive Places to Buy an Investment Property in California”. But wait a bit! There are even more places in California in this list… but we promise you: Some of them are much more affordable than the ones above…

Best Places to Buy an Investment Property for Airbnb Rental Income #7: Key Haven, FL

Airbnb Rental Income: $6,940
Airbnb Cash on Cash Return: 2.1%
Traditional Rental Income: $1,100
Traditional Cash on Cash Return: –
Median Property Price: $1,800,000

If you are looking for the best locations to invest in a vacation home in Florida, which offer much more affordable rental properties with significantly higher Airbnb cash on cash return and Airbnb cap rate, read “The 7 Best Places to Buy a Vacation Home in Florida”.

Best Places to Buy an Investment Property for Airbnb Rental Income #8: Great Falls, VA

Airbnb Rental Income: $6,900
Airbnb Cash on Cash Return: 4.6%
Traditional Rental Income: $2,970
Traditional Cash on Cash Return: 0.8%
Median Property Price: $995,000

Best Places to Buy an Investment Property for Airbnb Rental Income #9: Moss Landing, CA

Airbnb Rental Income: $6,750
Airbnb Cash on Cash Return: 1.8%
Traditional Rental Income: $1,780
Traditional Cash on Cash Return: –
Median Property Price: $975,000

Best Places to Buy an Investment Property for Airbnb Rental Income #10: Ewa Beach, HI

Airbnb Rental Income: $6,680
Airbnb Cash on Cash Return: 8.4%
Traditional Rental Income: $2,330
Traditional Cash on Cash Return: 2.3%
Median Property Price: $659,000

Actually, so far in our list of the top locations to buy an Airbnb investment property, Ewa Beach, HI is the first one which yields high return on investment in terms of good cash on cash return for Airbnb properties. It is also a much more affordable location compared to the places above.

Best Places to Buy an Investment Property for Airbnb Rental Income #11: Key West, FL

Airbnb Rental Income: $6,650
Airbnb Cash on Cash Return: 4.7%
Traditional Rental Income: $1,790
Traditional Cash on Cash Return: 0.1%
Median Property Price: $879,000

Best Places to Buy an Investment Property for Airbnb Rental Income #12: Pacific Grove, CA

Airbnb Rental Income: $6,550
Airbnb Cash on Cash Return: 4.9%
Traditional Rental Income: $2,500
Traditional Cash on Cash Return: 0.6%
Median Property Price: $984,000

Best Places to Buy an Investment Property for Airbnb Rental Income #13: Tiburon, CA

Airbnb Rental Income: $6,520
Airbnb Cash on Cash Return: 2.6%
Traditional Rental Income: $6,090
Traditional Cash on Cash Return: 2.3%
Median Property Price: $1,310,000

Best Places to Buy an Investment Property for Airbnb Rental Income #14: Boalsburg, PA

Airbnb Rental Income: $6,230
Airbnb Cash on Cash Return: 7.1%
Traditional Rental Income: $1,520
Traditional Cash on Cash Return: –
Median Property Price: $975,000

Here you have Boalsburd, PA – one more location where an Airbnb investment property yields high return on investment in terms of good cash on cash return.

Best Places to Buy an Investment Property for Airbnb Rental Income #15: Laguna Beach, CA

Airbnb Rental Income: $6,250
Airbnb Cash on Cash Return: 1.2%
Traditional Rental Income: $5,140
Traditional Cash on Cash Return: 0.6%
Median Property Price: $2,193,000

That’s quite pricey, no??? If, on the other hand, you are looking for the best locations to invest in a vacation home in California, which offer much more affordable rental properties with much higher Airbnb cash on cash return and Airbnb cap rate, read “The 5 Best Places to Buy a Vacation Home in California in 2017”.

Best Places to Buy an Investment Property for Airbnb Rental Income #16: Sullivans Island, SC

Airbnb Rental Income: $6,200
Airbnb Cash on Cash Return: 3.3%
Traditional Rental Income: $4,440
Traditional Cash on Cash Return: 1.6%
Median Property Price: $1,390,000

Best Places to Buy an Investment Property for Airbnb Rental Income #17: Nantucket, MA

Airbnb Rental Income: $6,150
Airbnb Cash on Cash Return: 1.7%
Traditional Rental Income: –
Traditional Cash on Cash Return: –
Median Property Price: $1,898,000

Best Places to Buy an Investment Property for Airbnb Rental Income #18: Napa, CA

Airbnb Rental Income: $6,070
Airbnb Cash on Cash Return: 5.8%
Traditional Rental Income: $2,700
Traditional Cash on Cash Return: 1.4%
Median Property Price: $673,000

Best Places to Buy an Investment Property for Airbnb Rental Income #19: Calistoga, CA

Airbnb Rental Income: $6,070
Airbnb Cash on Cash Return: 7.7%
Traditional Rental Income: $2,540
Traditional Cash on Cash Return: 1.9%
Median Property Price: $589,000

You might want to look further into Calistoga, CA if you are looking for a place which will generate good cash on cash return for your Airbnb rental.

Best Places to Buy an Investment Property for Airbnb Rental Income #20: Goleta, CA

Airbnb Rental Income: $6,040
Airbnb Cash on Cash Return: 4.6%
Traditional Rental Income: $3,240
Traditional Cash on Cash Return: 1.8%
Median Property Price: $799,000

Best Places to Buy an Investment Property for Airbnb Rental Income #21: West Belmar, NJ

Airbnb Rental Income: $6,040
Airbnb Cash on Cash Return: 10.0%
Traditional Rental Income: $2,300
Traditional Cash on Cash Return: 1.7%
Median Property Price: $467,000

In this list, West Belmar, NJ is the location which generates the highest Airbnb cash on cash return. A double-digit return on investment is actually great. And property prices are affordable, which makes West Belmar, NJ a viable investment option for even beginner real estate investors.

Best Places to Buy an Investment Property for Airbnb Rental Income #22: Poway, CA

Airbnb Rental Income: $6,020
Airbnb Cash on Cash Return: 3.6%
Traditional Rental Income: $2,610
Traditional Cash on Cash Return: 1.0%
Median Property Price: $860,000

And of course, there is no other more proper way to finish this list of the best places to buy an investment property for Airbnb rental income other than a California city. Simply because California is clearly dominating the ranking provided by Mashvisor’s rental property calculator.

In conclusion, we would like to remind all real estate investors that return on investment in real estate – regardless of which return on investment metric you use – boils down to a ratio of how much you are getting from your rental property (rental income) and how much you’ve paid for it (property price). To get good return on investment – such as good cash on cash return or good cap rate – you obviously have to have high rental income. However, you should also have relatively low property price. Thus, when you decide where to invest in real estate in the US in 2018, don’t look at just the Airbnb rental income. More importantly, look at the Airbnb cash on cash return to make sure that you will make good money from your next rental property. Also, since we are talking about Airbnb rentals here, always make sure to check the local laws and regulations governing short-term rentals before buying an investment property for the sole purpose of renting it out on Airbnb.