Cash on Cash Return: 2021 Airbnb Locations

With the rollout of the Covid-19 vaccine, the situation in the US housing market 2021 is expected to start coming back to normal soon. This includes the Airbnb industry which was disproportionately affected by the Coronavirus pandemic due to lockdowns, stay-at-home orders, and travelers’ concerns. Indeed, Mashvisor nationwide real estate market analysis reveals that the Airbnb occupancy rate is expected to be back on a sustainable growth path by September 2021. So, if you’re thinking of investing in real estate this year, you should definitely consider buying an Airbnb property. To help you locate a profitable investment opportunity, we provide you with a list of the 30 most profitable Airbnb locations for cash on cash return in the US market.

30 Most Profitable Airbnb Locations 2021

As a real estate investor eager to buy Airbnb property in 2021, you must be curious to find out the top markets for this investment strategy right away. So, let’s take a look at the 30 locations promising the highest return on investment for short-term rentals this year. Afterwards, we will discuss the real estate data used for this analysis, what these numbers mean, and other equally important considerations for Airbnb hosts.

1. San Angelo, TX

Airbnb Cash on Cash Return: 7.6%
Airbnb Occupancy Rate: 74%
Airbnb Daily Rate: $123
Airbnb Rental Income: $3,290
Median Property Price: $361,600
Average Price per Square Foot: $155
Listings for Sale: 155
Airbnb Listings: 171
Average Days on Market: 283
Walk Score: 33

2. Chesapeake, VA

Airbnb Cash on Cash Return: 6.8%
Airbnb Occupancy Rate: 69%
Airbnb Daily Rate: $157
Airbnb Rental Income: $3,500
Median Property Price: $331,900
Average Price per Square Foot: $171
Listings for Sale: 167
Airbnb Listings: 100
Average Days on Market: 65
Walk Score: 19

3. Valdosta, GA

Airbnb Cash on Cash Return: 6.2%
Airbnb Occupancy Rate: 70%
Airbnb Daily Rate: $95
Airbnb Rental Income: $2,180
Median Property Price: $286,700
Average Price per Square Foot: $107
Listings for Sale: 105
Airbnb Listings: 219
Average Days on Market: 39
Walk Score: 33

4. Canton, OH

Airbnb Cash on Cash Return: 6.1%
Airbnb Occupancy Rate: 54%
Airbnb Daily Rate: $106
Airbnb Rental Income: $2,970
Median Property Price: $201,000
Average Price per Square Foot: $10
Listings for Sale: 190
Airbnb Listings: 133
Average Days on Market: 70
Walk Score: 45

5. Portsmouth, VA

Airbnb Cash on Cash Return: 6.1%
Airbnb Occupancy Rate: 65%
Airbnb Daily Rate: $126
Airbnb Rental Income: $2,470
Median Property Price: $213,600
Average Price per Square Foot: $135
Listings for Sale: 155
Airbnb Listings: 237
Average Days on Market: 61
Walk Score: 25

6. Independence, MO

Airbnb Cash on Cash Return: 6.0%
Airbnb Occupancy Rate: 61%
Airbnb Daily Rate: $107
Airbnb Rental Income: $1,700
Median Property Price: $192,100
Average Price per Square Foot: $115
Listings for Sale: 142
Airbnb Listings: 417
Average Days on Market: 57
Walk Score: 29

7. Eau Claire, WI

Airbnb Cash on Cash Return: 6.0%
Airbnb Occupancy Rate: 65%
Airbnb Daily Rate: $127
Airbnb Rental Income: $2,640
Median Property Price: $305,400
Average Price per Square Foot: $143
Listings for Sale: 101
Airbnb Listings: 186
Average Days on Market: 98
Walk Score: 29

8. Fayetteville, NC

Airbnb Cash on Cash Return: 5.9%
Airbnb Occupancy Rate: 71%
Airbnb Daily Rate: $98
Airbnb Rental Income: $2,160
Median Property Price: $223,300
Average Price per Square Foot: $147
Listings for Sale: 696
Airbnb Listings: 1,472
Average Days on Market: 78
Walk Score: 24

9. Springfield, MO

Airbnb Cash on Cash Return: 5.8%
Airbnb Occupancy Rate: 59%
Airbnb Daily Rate: $100
Airbnb Rental Income: $2,230
Median Property Price: $285,700
Average Price per Square Foot: $122
Listings for Sale: 194
Airbnb Listings: 1,094
Average Days on Market: 64
Walk Score: 31

10. Fort Wayne, IN

Airbnb Cash on Cash Return: 5.7%
Airbnb Occupancy Rate: 68%
Airbnb Daily Rate: $82
Airbnb Rental Income: $2,290
Median Property Price: $262,800
Average Price per Square Foot: $125
Listings for Sale: 444
Airbnb Listings: 3,932
Average Days on Market: 71
Walk Score: 33

11. Jackson, MS

Airbnb Cash on Cash Return: 5.7%
Airbnb Occupancy Rate: 67%
Airbnb Daily Rate: $97
Airbnb Rental Income: $2,590
Median Property Price: $280,000
Average Price per Square Foot: $63
Listings for Sale: 129
Airbnb Listings: 1,688
Average Days on Market: 127
Walk Score: 24

12. Riverside, CA

Airbnb Cash on Cash Return: 5.7%
Airbnb Occupancy Rate: 67%
Airbnb Daily Rate: $156
Airbnb Rental Income: $4,470
Median Property Price: $542,600
Average Price per Square Foot: $308
Listings for Sale: 556
Airbnb Listings: 162
Average Days on Market: 51
Walk Score: 35

13. Johnson City, TN

Airbnb Cash on Cash Return: 5.7%
Airbnb Occupancy Rate: 61%
Airbnb Daily Rate: $109
Airbnb Rental Income: $2,110
Median Property Price: $304,000
Average Price per Square Foot: $119
Listings for Sale: 120
Airbnb Listings: 110
Average Days on Market: 67
Walk Score: 30

14. Richardson, TX

Airbnb Cash on Cash Return: 5.7%
Airbnb Occupancy Rate: 67%
Airbnb Daily Rate: $193
Airbnb Rental Income: $3,470
Median Property Price: $401,900
Average Price per Square Foot: $187
Listings for Sale: 127
Airbnb Listings: 420
Average Days on Market: NA
Walk Score: 38

15. Arlington, TX

Airbnb Cash on Cash Return: 5.6%
Airbnb Occupancy Rate: 62%
Airbnb Daily Rate: $180
Airbnb Rental Income: $2,750
Median Property Price: $318,800
Average Price per Square Foot: $150
Listings for Sale: 450
Airbnb Listings: 1,302
Average Days on Market: 74
Walk Score: 41

16. Akron, OH

Airbnb Cash on Cash Return: 5.6%
Airbnb Occupancy Rate: 58%
Airbnb Daily Rate: $85
Airbnb Rental Income: $1,650
Median Property Price: $150,400
Average Price per Square Foot: $97
Listings for Sale: 249
Airbnb Listings: 224
Average Days on Market: 61
Walk Score: 48

17. Bakersfield, CA

Airbnb Cash on Cash Return: 5.5%
Airbnb Occupancy Rate: 74%
Airbnb Daily Rate: $135
Airbnb Rental Income: $3,020
Median Property Price: $381,000
Average Price per Square Foot: $186
Listings for Sale: 212
Airbnb Listings: 447
Average Days on Market: 67
Walk Score: 28

18. Ypsilanti, MI

Airbnb Cash on Cash Return: 5.4%
Airbnb Occupancy Rate: 67%
Airbnb Daily Rate: $155
Airbnb Rental Income: $2,490
Median Property Price: $279,000
Average Price per Square Foot: $157
Listings for Sale: 102
Airbnb Listings: 286
Average Days on Market: 86
Walk Score: 41

19. Richmond, VA

Airbnb Cash on Cash Return: 5.4%
Airbnb Occupancy Rate: 65%
Airbnb Daily Rate: $140
Airbnb Rental Income: $2,940
Median Property Price: $369,300
Average Price per Square Foot: $198
Listings for Sale: 790
Airbnb Listings: 4,061
Average Days on Market: 97
Walk Score: 46

20. Hattiesburg, MS

Airbnb Cash on Cash Return: 5.3%
Airbnb Occupancy Rate: 60%
Airbnb Daily Rate: $98
Airbnb Rental Income: $1,980
Median Property Price: $268,100
Average Price per Square Foot: $104
Listings for Sale: 156
Airbnb Listings: 405
Average Days on Market: 81
Walk Score: 34

21. Visalia, CA

Airbnb Cash on Cash Return: 5.3%
Airbnb Occupancy Rate: 78%
Airbnb Daily Rate: $84
Airbnb Rental Income: $2,700
Median Property Price: $394,200
Average Price per Square Foot: $183
Listings for Sale: 137
Airbnb Listings: 114
Average Days on Market: 84
Walk Score: 47

22. Columbus, GA

Airbnb Cash on Cash Return: 5.2%
Airbnb Occupancy Rate: 67%
Airbnb Daily Rate: $98
Airbnb Rental Income: $1,830
Median Property Price: $254,800
Average Price per Square Foot: $114
Listings for Sale: 137
Airbnb Listings: 722
Average Days on Market: 95
Walk Score: 34

23. Springfield, IL

Airbnb Cash on Cash Return: 5.2%
Airbnb Occupancy Rate: 63%
Airbnb Daily Rate: $100
Airbnb Rental Income: $1,570
Median Property Price: $162,600
Average Price per Square Foot: $85
Listings for Sale: 138
Airbnb Listings: 1,094
Average Days on Market: 94
Walk Score: 40

24. Roanoke, VA

Airbnb Cash on Cash Return: 5.2%
Airbnb Occupancy Rate: 68%
Airbnb Daily Rate: $106
Airbnb Rental Income: $2,410
Median Property Price: $322,900
Average Price per Square Foot: $130
Listings for Sale: 101
Airbnb Listings: 926
Average Days on Market: 138
Walk Score: 37

25. Reno, NV

Airbnb Cash on Cash Return: 5.1%
Airbnb Occupancy Rate: 65%
Airbnb Daily Rate: $142
Airbnb Rental Income: $3,510
Median Property Price: $381,900
Average Price per Square Foot: $284
Listings for Sale: 402
Airbnb Listings: 207
Average Days on Market: 87
Walk Score: 12

26. Tucson, AZ

Airbnb Cash on Cash Return: 5.1%
Airbnb Occupancy Rate: 65%
Airbnb Daily Rate: $102
Airbnb Rental Income: $2,520
Median Property Price: $320,700
Average Price per Square Foot: $170
Listings for Sale: 903
Airbnb Listings: 6,388
Average Days on Market: 51
Walk Score: 40

27. Norfolk, VA

Airbnb Cash on Cash Return: 5.1%
Airbnb Occupancy Rate: 62%
Airbnb Daily Rate: $158
Airbnb Rental Income: $2,570
Median Property Price: $308,400
Average Price per Square Foot: $167
Listings for Sale: 267
Airbnb Listings: 1,606
Average Days on Market: 77
Walk Score: 41

28. San Marcos, TX

Airbnb Cash on Cash Return: 5.0%
Airbnb Occupancy Rate: 46%
Airbnb Daily Rate: $177
Airbnb Rental Income: $3,120
Median Property Price: $324,900
Average Price per Square Foot: $171
Listings for Sale: 157
Airbnb Listings: 313
Average Days on Market: 107
Walk Score: 33

29. Chico, CA

Airbnb Cash on Cash Return: 5.0%
Airbnb Occupancy Rate: 69%
Airbnb Daily Rate: $152
Airbnb Rental Income: $3,560
Median Property Price: $535,700
Average Price per Square Foot: $300
Listings for Sale: 200
Airbnb Listings: 255
Average Days on Market: 62
Walk Score: 62

30. Wichita, KS

Airbnb Cash on Cash Return: 5.0%
Airbnb Occupancy Rate: %66
Airbnb Daily Rate: $95
Airbnb Rental Income: $2,030
Median Property Price: $240,700
Average Price per Square Foot: $111
Listings for Sale: 145
Airbnb Listings: 881
Average Days on Market: 81
Walk Score: 36

What About Airbnb Laws and Regulations in These Markets?

Before we move further into our discussion on the best cities for Airbnb investment in 2021, we should talk about the short-term rentals regulations in these profitable locations.

The amazing growth of the Airbnb rental industry since 2008 caused the US hotel lobby as well as residents in many US major cities and hot tourist destinations to force local authorities to impose strict regulations and even prohibitions on vacation home rentals. The result was a wave of Airbnb laws across the US real estate market which limit short-term rental properties to different degrees.

When it comes to the top 30 most profitable Airbnb locations in 2021, it’s important to note that some of them face regulations and restrictions on the renting of investment properties on Airbnb and other similar vacation rental platforms.

Thus, as a savvy investor and a smart Airbnb host, you should check out local Airbnb laws and regulations before deciding to own an Airbnb investment property in any of these markets. You should also consider hiring a professional vacation rental management company. Property managers with experience in and knowledge of the local housing market will be able to give you the best advice on how to own a profitable short-term rental property without getting in trouble with the authorities. Moreover, working with a professional property manager will give you the opportunity to turn your rental property into a passive investment without compromising the expected rate of return.

Why Do We Look at the Airbnb Cash on Cash Return?

Another question which might be poking the brains of eager real estate investors is why we are determining the most profitable Airbnb locations for 2021 based on the cash on cash return and not another metric of profitability such as the Airbnb daily rate, the Airbnb income, the Airbnb occupancy rate, the Airbnb cash flow, or the Airbnb cap rate.

While CoC return is just one of the many measures of return on investment in real estate, it is the most comprehensive one. The cash on cash return formula allows investors to evaluate the investment potential of an Airbnb business endeavor based on how much money they will be able to make from it taking into consideration the property price, the one-time startup costs, the recurring monthly expenses, the rental income, and – importantly – the method of financing.

For example, metrics such as the Airbnb daily rate and the Airbnb occupancy rate are crucial factors in determining the profitability of an Airbnb investment, but they don’t tell the full story. Airbnb cash flow is a bit more thorough but still does not reveal the return compared to the property price. The Airbnb cap rate does that but discards the method of financing of a rental property: cash vs. mortgage. As most beginner investors have to rely on taking a loan, financing cannot be disregarded.

Meanwhile, the Airbnb CoC return takes into account all these major factors to provide an all-inclusive measure of return on investment, whether we are looking at traditional or Airbnb rental properties.

What Airbnb Data Is Used for These Calculations?

In 2021 data is power. With the advancement of big data, artificial intelligence, and predictive analytics, the world of real estate investing has been majorly transformed. Successful investors will be those who get their hands on the most reliable and trustworthy sources of real estate data.

That’s why it’s important to explain where the data for the list of the 30 most profitable Airbnb locations 2021 comes from.

The Airbnb data provided above has been collected and analyzed by the Mashvisor real estate investment software. We gather real estate and rental data from dozens of reliable, publicly available sources such as Airbnb.com, the MLS, and others before applying our machine-learning algorithms to provide investors with top-notch Airbnb analytics.

The Mashvisor Airbnb data analytics are based on the performance of actual Airbnb listings in each market. We obtain our Airbnb rental comps right from the Airbnb website, which ensures data accuracy and reliability.

What Characterizes the Best Cities for Airbnb Investment in 2021?

Let’s next have a look at some of the most prominent trends in the Airbnb market in the US in 2021:

Surprising Airbnb Cities and States

First and foremost, the most profitable Airbnb locations in 2021 are rather surprising. These are definitely not the markets which come to mind when you think about the boom of the short-term rental industry such as Airbnb Los Angeles, Airbnb New York City, Airbnb San Francisco, Airbnb Dallas, Airbnb Atlanta, and Airbnb Las Vegas.

There are a few reasons for this trend. Importantly, non-owner occupied short-term rentals have been declared illegal in many of these previously top markets, which caused investors to look into other places. Furthermore, these cities usually offer prohibitively high real estate prices, which affect negatively the return on investment.

The important takeaway for beginner investors is to not underestimate the importance of smaller markets when going for the Airbnb investment strategy.

Wide Geographical Distribution

Second, the markets which offer the highest rate of return for vacation home rentals are distributed throughout the entire US housing market 2021. This is great news for investors who’d rather stay away from out of state real estate investing and prefer to buy a rental property close to home.

Nevertheless, a few states emerge as the most profitable for Airbnb investments this year. The Virginia real estate market is a definite winner as it hosts 5 of the top Airbnb locations, followed by the Texas housing market and the California housing market, which are each home to 4 of these locations. The Ohio real estate market, the Georgia housing market, and the Mississippi real estate market are definitely worth keeping an eye on as well.

Surprisingly, the Florida real estate market has dropped off from the list of the best places to invest in Airbnb in 2021. Actually, vacation rentals in the Sunshine State were disproportionately affected by the Covid-19 pandemic. Even by September 2020, when the Airbnb occupancy rate has entered a recovery mode in the majority of US markets, Florida was lagging behind. However, the rollout of the Coronavirus vaccine is expected to change this recent trend and bring Florida back on the map of the most profitable locations for Airbnb in 2021 and beyond.

Secondary and Tertiary Real Estate Markets

As already hinted above, the list of the 30 best markets for short-term rental property investments in 2021 is made up of mostly tertiary but also some secondary markets in real estate, rather than primary markets. One of the leading reasons for this has been the pandemic which hit US large cities stronger than smaller towns. With the new reality of remote working, many professionals are escaping from the overpriced cities to more affordable and safer locations and are looking for long-term Airbnb rentals. Suburban markets have benefited from this reality both with regards to long-term and short-term rental properties.

Major Changes Since 2020

Nationwide real estate market analysis comparing 2021 with 2020 will reveal significant departures from the performance of Airbnb rentals since last year. This is only expected in such a volatile situation as a global pandemic.

Importantly, the list of the most profitable Airbnb locations has completely changed from 2020 to 2021. Moreover, the average return on investment has dropped. Last year the 20 best markets for investing in an Airbnb for sale boasted a double-digit cash on cash return, reaching as high as 17.5% in Tuscaloosa, AL. This year the CoC return in the top 30 places ranges from 5.0% in the Wichita real estate market to 7.6% in the San Angelo housing market. Nevertheless, investors should keep in mind that these are just city averages, while individual investment properties for sale still offer double-digit returns.

Strong Airbnb Occupancy Rates

As mentioned before, the Airbnb occupancy rate is one of the main determinants of how much money you will be able to make with a vacation home rental. As expected, all the best locations for this rental strategy offer high occupancy rates: from 46% in San Marcos, TX to 78% in Visalia, CA. Of course, as an individual investor, you can work on making your property stand out from the rest of the Airbnb listings in the area or even hire a professional property manager to push your occupancy rate up. This will inevitably increase your Airbnb income and profitability as well.

Affordable Home Prices

Last but not least, these places provide investors with below-average property prices. This is an important consideration for first-time real estate investors and others who have a limited budget. Furthermore, low home values help Airbnb hosts push their return on investment up, regardless of whether they look at cash on cash return or cap rate. The 30 markets listed above offer house prices running from $150,400 in the Akron housing market to $581,900 in the Reno real estate market.

How to Buy a Top-Performing Airbnb Rental Property in the US Housing Market 2021

Knowing the most profitable Airbnb locations is the first step in owning an Airbnb property that generates profit month after month. However, it is not enough to make a profitable investment decision.

Find a Profitable Airbnb Investment Property

Here are the main steps you have to go through in order to ensure a lucrative short-term rental property investment:

Real Estate Market Analysis

Buying a top-performing Airbnb property starts with analyzing the US market as a whole and identifying the most profitable locations which fit your budget and expectations. You can skip this step as you already know which cities and towns promise the highest return in 2021.

Now it’s time to choose a couple of these locations which fit your requirements as an investor and conduct deeper real estate market analysis on them. Since we are looking at vacation home rentals, it’s crucial to research the Airbnb legal issues to make sure that you can own an Airbnb property there.

Neighborhood Analysis

Once you’ve completed the previous step, you should move to neighborhood analysis. Even if you know the market you want to invest in, you’ll soon figure out that different areas within the same city offer very different rates of return on short-term rentals. Moreover, they come with different property prices which affects affordability.

Analyzing several neighborhoods will take lots of time and energy unless you make use of the best real estate investment tools for this kind of job. Mashvisor’s real estate heatmap will provide you with a quick visualization of the best areas to search for Airbnb rental properties for sale based on a number of criteria including:

Listing prices
Airbnb rental income
Airbnb occupancy rate
Airbnb cash on cash return

Most Profitable Airbnb Locations 2021 Cash on Cash Return: Real Estate Heatmap

Mashvisor’s Real Estate Heatmap

In this way, you can quickly identify a few areas that match your investor expectations and focus your neighborhood analysis on them.

Mashvisor’s neighborhood pages will provide you with readily available Airbnb data analytics for each area within a US city. Some of the Airbnb information which you will be able to get includes:

Median property price
Average price per square foot
Airbnb rental income
Airbnb occupancy rate
Airbnb cash on cash return
Number of Airbnb listings
Number of investment properties for sale
Optimal rental strategy: Airbnb vs. traditional
Airbnb rental comps
Walk Score
Optimal property type
Optimal number of bedrooms

Most Profitable Airbnb Locations 2021 Cash on Cash Return: Neighborhood Analysis

Mashvisor’s Neighborhood Analysis Pages

All these factors will help you confirm if this neighborhood is the best area to focus your Airbnb investment property search efforts on.

Investment Property Search

As soon as you know where you want to invest in real estate to rent out on a short-term basis, you should start your rental property search. Mashvisor’s search engine will allow you to enter your criteria to provide you with the investment properties for sale which match your expectations. Some of the factors include:

Budget
Expected Airbnb income
Expected Airbnb cash on cash return
Expected Airbnb cap rate
Number of bedrooms and bathrooms
Year built
Property size
Property type: single-family home, townhouse, condo, apartment, multi-family home, etc.
Listing type: for sale, pending, or foreclosure
Financing method: cash vs. mortgage

Rental Property Analysis

Now we come to the most important step in buying a profitable Airbnb property: the investment property analysis. This is a detailed analysis of all the property features as well as all the factors that play a role in determining the return on investment.

To be able to conduct rental property analysis on a number of different vacation homes to choose the best one for your particular situation, you should use Mashvisor’s Airbnb profit calculator. This investment property calculator will provide you with all the information you can possibly need to make a profitable investment decision.

For each property listed on the Mashvisor platform as well as for each property whose address you enter, you will get immediate access to the following Airbnb data (and this is not an exhaustive list):

Property address
Property type
Property characteristics
Property description
Number of bedrooms and bathrooms
Listing price
Traditional and Airbnb comparable rental income
Traditional and Airbnb cash flow
Traditional and Airbnb cash on cash return
Traditional and Airbnb cap rate
Traditional and Airbnb occupancy rate
One-time startup costs: home inspection, repair, furniture, appliances, and closing costs
Recurring monthly expenses: property insurance, utilities, professional property management, property maintenance, property tax, HOA fees, rental income tax, and cleaning fees
Mortgage calculator including method of financing, down payment, mortgage type, loan term, and interest rate
Investment payback balance
Real estate comps
Traditional and Airbnb rental comps

Most Profitable Airbnb Locations 2021 Cash on Cash Return: Investment Property Analysis

Mashvisor’s Airbnb Profit Calculator

Importantly, the Mashvisor rental property calculator allows investors to change any of the metrics if they have a reason to believe that they will be able to achieve a better occupancy rate, if they want to include property management, or if they plan to do major renovations on the property, for example. As soon as you modify any of the metrics, all calculations will be automatically redone to provide you with updated estimates of return on investment.

If you are planning to buy an Airbnb property in 2021, the best advice you will hear is to get access to the top real estate investment tools. This will help you not only save time and energy but also ensure that your analysis is complete and accurate.

So, these are the 30 most profitable Airbnb locations in 2021 based on cash on cash return. If you want to start making money from short-term rental properties this year, focus your efforts on these markets. Sign up for Mashvisor to take your real estate research and analysis to the next level. Your lucrative Airbnb property is just a few clicks away.

Start Your Investment Property Search!

The 30 Most Profitable Airbnb Locations in 2021: Cash on Cash Return