2023 is expected to be a year of real estate market moderation. Investors can cash in by investing in one of the hottest Airbnb markets of 2023.
The Airbnb rental property industry has gone through a lot of ups and downs in the past few years. After a shock that almost brought the market to its knees in 2020, 2021 saw the market attempt to bounce back and recover to pre-pandemic levels. 2022 was quite a significant year for the industry as the market experienced expansion.
Table of Contents
- The Top Ten Hottest Airbnb Markets 2023
- Hottest Airbnb Markets 2023: Key Findings
- Legal Issues Surrounding the Short-Term Rental Industry
- How Did We Get These Short Term Rental Market Data?
With mortgage rates hitting the roof and crazy inflation to boot, many investors don’t know whether investing now is a wise financial decision. Many are choosing to sit on the sidelines and watch everything unravel.
But the truth is that investors who are bold enough to make an investment move in 2023 are going to reap big. The market is expected to experience remarkable growth this year and reach unparalleled levels in the coming years.
So if you have not yet invested in an Airbnb property, now is the time to do so.
In this article, we will list the ten best short term rental markets for 2023. We will also discuss:
- Our key findings from researching these hot rental markets
- The legalities surrounding these top Airbnb markets
- How we came up with the list of the best cities for short term rentals
Related: 3 Housing Markets Where Investors Can Earn Positive Cash Flow With Airbnb in 2023
The Top Ten Hottest Airbnb Markets 2023
Using Mashvisor’s data as of May 2023, here are the ten cities where you can buy a short term rental investment property with high-profit potential.
The cities in this list have all met the following criteria:
- Median property price below $1 million
- At least 100 Airbnb listings
- Airbnb rental income above $2,000
- At least 2% Airbnb cash on cash return
- Airbnb occupancy rate of 50% and up
That said, let’s look at the top Airbnb locations;
1. Northlake, IL
- Median Property Price: $296,160
- Average Price per Square Foot: $233
- Days on Market: 128
- Number of Airbnb Listings: 120
- Monthly Airbnb Rental Income: $4,269
- Airbnb Cash on Cash Return: 9.08%
- Airbnb Cap Rate: 9.25%
- Airbnb Daily Rate: $171
- Airbnb Occupancy Rate: 53%
- Walk Score: 33
Why Invest in Airbnb Rentals in Northlake, IL?
The first city on our list of hottest Airbnb markets in 2023 is Northlake City, located in Cook County, Illinois.
As you can see from our data above, this city presents a high return on investment compared to the relatively low median property price. This makes a great city for investors who may not have a lot of startup capital.
And this city has various attractions to keep your Airbnb rental booked for a large part of the year. Popular attractions include Redmond Recreational Complex, Gouin Park, Gouin Pool & Water Slides, Glos Memorial Park, and Elmhurst History Museum.
One more reason why you should consider investing in Airbnb rentals in Northlake, IL, is due to its proximity to Chicago. Located roughly 25 minutes from the big city, you can host guests who want a break from the hustle and bustle.
2. Rileyville, VA
- Median Property Price: $328,431
- Average Price per Square Foot: $241
- Days on Market: 34
- Number of Airbnb Listings: 111
- Monthly Airbnb Rental Income: $4,034
- Airbnb Cash on Cash Return: 8.64%
- Airbnb Cap Rate: 8.78%
- Airbnb Daily Rate: $219
- Airbnb Occupancy Rate: 60%
- Walk Score: 10
Why Invest in Airbnb Rentals in Rileyville, VA?
Rileyville is a small village located in Page County in the state of Virginia. It earns a spot in our list of hottest Airbnb markets to invest in 2023 due to the high return on investment, daily rates, and occupancy rates.
Popular attractions include the Shenandoah River Outfitters, Mudkat Outfitters LLC, and Dean Cemetery. Your guests can also enjoy local cuisine at the Hillside Motel, Cardinal Inn, and Anthony’s Pizza.
This village is accessible via road and rail.
3. Harvey, LA
- Median Property Price: $316,717
- Average Price per Square Foot: $145
- Days on Market: 77
- Number of Airbnb Listings: 1,639
- Monthly Airbnb Rental Income: $3,997
- Airbnb Cash on Cash Return: 8.47%
- Airbnb Cap Rate: 8.62%
- Airbnb Daily Rate: $207
- Airbnb Occupancy Rate: 54%
- Walk Score: 52
Why Invest in Airbnb Rentals in Harvey, LA?
Located on the Southern side of the Mississippi River, Harvey is a small town in Louisiana with a unique atmosphere that can’t be found in many larger cities.
This town is just 10 minutes from New Orleans, known for its vibrant nightlife, distinctive music, unique cuisine, annual festivals, and rich history.
Many tourists who visit this town are attracted to the Jean Lafitte National Historical Park & Preserve, Gretna Park, Gretna Historical Society, and Mississippi River Trail. The Bayou Segnette State Park also attracts visitors from other places.
As an Airbnb host in Harvey, LA, you can expect more bookings from February to May and September to December due to the good weather.
4. Melvindale, MI
- Median Property Price: $147,000
- Average Price per Square Foot: $255
- Days on Market: 88
- Number of Airbnb Listings: 114
- Monthly Airbnb Rental Income: $2,031
- Airbnb Cash on Cash Return: 7.66%
- Airbnb Cap Rate: 7.94%
- Airbnb Daily Rate: $123
- Airbnb Occupancy Rate: 51%
- Walk Score: 64
Why Invest in Airbnb Rentals in Melvindale, MI?
Melvindale in Michigan is quite a special town in our list of best cities to invest in Airbnb rentals. This town has the lowest median property price on this list. With the high cash on cash return, you can expect handsome returns.
Major attractions in this town include the Melvindale Civic Arena, Melvindale Public Library, The Uniroyal Tire, and Thunderbowl Lanes. Guests can also enjoy the local cuisine at Moro’s Dining and Giovanni’s Ristorante.
This town is just 15 minutes from Detroit, so you can expect to host some visitors from the big city.
As an Airbnb host, expect increased bookings from April to October due to the ideal weather.
The state of Michigan has a local ordinance that bans Airbnb rentals in some areas. You might want to conduct some research to ensure you don’t buy vacation rental properties in the areas where they are forbidden.
5. Darby, PA
- Median Property Price: $189,270
- Average Price per Square Foot: $145
- Days on Market: 70
- Number of Airbnb Listings: 585
- Monthly Airbnb Rental Income: $2,472
- Airbnb Cash on Cash Return: 7.62%
- Airbnb Cap Rate: 7.83%
- Airbnb Daily Rate: $140
- Airbnb Occupancy Rate: 55%
- Walk Score: 87
Why Invest in Airbnb Rentals in Darby, PA?
Darby is located in Delaware County, Pennsylvania State. This city is great for young professionals looking for vibrant nightlife, relaxing parks, and great coffee shops.
It ranks second, after Melvindale, MI, for cities with the lowest median property price in this list.
While this small town may not be as popular as many other great cities in the United States, it’s an upcoming tourist destination with many things to offer its visitors.
Nearby attractions include the John Heinz National Wildlife Refuge at Tinicum, Hoffman Park, Smedley Park (Delaware County Park), Leiper Historic House, Crum Creek, and many others.
This town is just 20 minutes from Philadelphia, Pennsylvania’s largest city.
Pennsylvania, as a state, doesn’t have any laws and regulations specific to Airbnb rentals. However, every county and city has regulations for short term rentals within their jurisdiction. You might want to conduct some research before investing.
6. Marrero, LA
- Median Property Price: $339,750
- Average Price per Square Foot: $169
- Days on Market: 66
- Number of Airbnb Listings: 1,313
- Monthly Airbnb Rental Income: $3,722
- Airbnb Cash on Cash Return: 7.55%
- Airbnb Cap Rate: 7.68%
- Airbnb Daily Rate: $215
- Airbnb Occupancy Rate: 53%
- Walk Score: 66
Why Invest in Airbnb Rentals in Marrero, LA?
Marrero is located in Jefferson Parish in Louisiana State. Just like Harvey, Marrero is also on the South side of the Mississippi River.
One of the numerous benefits of investing in Airbnb rentals in Marrero, LA, is that it nears a few wilderness and wildlife areas. It makes a great destination for those looking for a thrilling excursion.
Nearby attractions include the National World War II Museum, Caesars Superdome, Port of New Orleans, Canal Street, Bourbon Street, and Jackson Square. You can also host students and professors visiting Tulane University.
The best thing about having an Airbnb rental in this town is that there are only two small hotels. This makes your competition minimal and gives you the freedom to set a high daily rate.
7. Broadview, IL
- Median Property Price: $231,478
- Average Price per Square Foot: $176
- Days on Market: 48
- Number of Airbnb Listings: 286
- Monthly Airbnb Rental Income: $2,931
- Airbnb Cash on Cash Return: 7.40%
- Airbnb Cap Rate: 7.58%
- Airbnb Daily Rate: $168
- Airbnb Occupancy Rate: 57%
- Walk Score: 77
Why Invest in Airbnb Rentals in Broadview, IL?
Broadview is a village located in Cook County in Illinois State. It’s located just 15 minutes from Chicago. Its proximity to the big city makes it a great vacation destination for people looking for a weekend getaway.
Popular and nearby attractions include the Salt Creek Trail System, Go Ape Zipline & Adventure Park, Mount Carmel Catholic Cemetery, and Bemis Woods South.
Cook County has some strict Airbnb laws and regulations that hosts must adhere to. For example, Airbnb hosts are required to live on the said property and host a maximum of two individuals per room. You must also obtain the necessary licenses and permits to operate an Airbnb legally in Broadview, IL.
8. Bar Harbor, ME
- Median Property Price: $629,058
- Average Price per Square Foot: $363
- Days on Market: 97
- Number of Airbnb Listings: 297
- Monthly Airbnb Rental Income: $6,167
- Airbnb Cash on Cash Return: 7.40%
- Airbnb Cap Rate: 7.47%
- Airbnb Daily Rate: $321
- Airbnb Occupancy Rate: 65%
- Walk Score: 77
Why Invest in Airbnb Rentals in Bar Harbor, ME?
Bar Harbor is a tourist town on Mount Desert Island along Frenchman Bay in Maine State. It’s known for its breathtaking coastal appeal, views of islands and ocean, and the many lobster boats and yachts.
Visitors from all over the world throng to this town, which serves as the gateway to Acadia National Park, to enjoy its amazing scenery.
Acadia National Park is one of the most visited national parks in the US. With about 4 million people visiting the park in 2022, you’re certain that your Airbnb rental in this town will enjoy a high occupancy rate and command handsome daily rates.
Other popular attractions include the Thunder Hole, Bar Harbor Whale Watch Co, Ocean Path, Park Loop Road, Bubble Rock, Gorham Mountain Trail, Egg Rock Lighthouse, and many others.
While you can expect a large number of bookings to be in the summer, fall and spring seasons are also great periods for guests looking to avoid crowds and the high home prices of the high season.
To legally operate an Airbnb rental, you need to register with the Town of Bar Harbor. Registrations are renewed annually. Your property must also pass an inspection before getting a registration card. An inspection is carried out every three years.
Your registration card must be displayed where your guests can see it.
9. Columbia, MO
- Median Property Price: $300,851
- Average Price per Square Foot: $131
- Days on Market: 103
- Number of Airbnb Listings: 263
- Monthly Airbnb Rental Income: $2,663
- Airbnb Cash on Cash Return: 7.09%
- Airbnb Cap Rate: 7.26%
- Airbnb Daily Rate: $161
- Airbnb Occupancy Rate: 57%
- Walk Score: 30
Why Invest in Airbnb Rentals in Columbia, MO?
Columbia is a city located in central Missouri. This city is a worthy Airbnb rental investment location with diverse attractions to take your guests’ breath away and a vibrant nightlife.
Columbia is mainly known as a center of learning. You can customize your Airbnb rental to target students and scholars from the University of Missouri, Columbia College, and Stephens College.
Other attractions include the Rock Bridge Memorial State Park, Twin Lakes Recreation Area, Grindstone Nature Area, Finger Lakes State Park, Shelter Gardens, and David R. Francis Quadrangle Historic District.
You can also host sports enthusiasts coming to watch sports events at the Faurot Field at Memorial Stadium.
The city of Columbia is currently considering imposing stricter laws and regulations on Airbnb rentals. You might want to ensure that the laws won’t affect your Airbnb business down the line.
10. East Lansdowne, PA
- Median Property Price: $250,557
- Average Price per Square Foot: $156
- Days on Market: 163
- Number of Airbnb Listings: 613
- Monthly Airbnb Rental Income: $2,244
- Airbnb Cash on Cash Return: 6.81%
- Airbnb Cap Rate: 7.01%
- Airbnb Daily Rate: $139
- Airbnb Occupancy Rate: 54%
- Walk Score: 65
Why Invest in Airbnb Rentals in East Lansdowne, PA?
East Lansdowne is a borough located in Delaware County of Pennsylvania State. It’s a small town that offers the best of the old and new worlds. Its people, charm, services, architecture, history, and culture offer a genuine warmth that can only be found in a small town.
Popular attractions include the Simeone Foundation Automotive Museum, Fabric Workshop and Museum, Lansdowne Farmers Market, Lansdowne Theater, The Turkey Hill Experience, and Philadelphia Cruise.
Besides, this town is just 20 minutes from Philadelphia, so you can expect to host guests from the city.
Hottest Airbnb Markets 2023: Key Findings
While gathering information about these cities, we discovered the following facts and figures:
- The average Airbnb income in the top ten markets is $3,453 per month or $41,436 per year.
- All ten cities have a cash on cash return above 6%. It measures how much you made on the property in relation to how much you paid toward the property in a year, whether full payment or mortgage.
- Only one of the median property prices went over $500,000. This makes these markets friendly to beginner investors who may not have a lot of capital and would need to use financing to buy their first Airbnb rental.
Related: How to Research an Airbnb Market and Quickly Find a Good Place to Buy Rental Property
Legal Issues Surrounding the Short-Term Rental Industry
Some of the hottest Airbnb markets in 2023 have very stringent regulations surrounding Airbnb and other short term rentals.
Some of the laws may limit Airbnb investors who are simply looking to expand their portfolios. For beginners, be sure to carry out in-depth research before investing in these cities.
But even if the city allows these types of property, neighborhoods that are controlled by an HOA might have their own set of rules. So before you commit to buying an Airbnb investment property, you should ask yourself the following questions:
- Will your short term rental strategy bother the neighbors? If so, you could disallow overnight bookings and limit the maximum occupancy to prevent parties or groups that may make a lot of noise.
- Do you need to apply for a license to legally operate in the area? Will your estimated income be able to cover this cost along with the other expenses?
- Are there taxes you need to pay to operate an Airbnb? How will this affect your profitability?
It is also important to contact the appropriate municipality and read the HOA bylaws to confirm that you can host an Airbnb in the area.
How Did We Get These Short Term Rental Market Data?
All of the data shown on our list of the hottest Airbnb markets in 2023 were provided by Mashvisor’s analytics, which got them from active and verified Airbnb listings. Unlike other Airbnb analytics tools that collect data from all listings on the platform, we filter them and choose actively listed properties with at least three reviews on their pages.
After selecting the listings that meet our criteria, we then calculate the average daily rates of each area based on the rental income-to-bedroom ratio. As for the Airbnb demand, we check the number of bookings every month and project the occupancy rate based on the daily rate and property type. We then estimate the monthly rental income by multiplying the average daily rate by the occupancy rate.
As for the 2023 housing market data, we sourced them from MLS. We also filtered these by selecting common investment property types (apartment, condo, townhouse, single-family house) with one to four bedrooms. After gathering data on properties matching our criteria, we calculated the median property price, average price per square foot, and days on market. Meanwhile, the Walk Score is sourced from WalkScore.com.
Lastly, we calculate the cash on cash return based on the estimated annual rental income divided by the property price.
Related: How to Find Affordable Investment Properties With Huge Potential
What Else Can You Get on Mashvisor?
Other than access to an extensive real estate database, Mashvisor also gives you access to several helpful investment tools.
- Understand a neighborhood or city’s average performance right away with the help of our heatmap. It works like a weather map that tells you which markets are hot and which ones are not. It gives you a better idea of how specific neighborhoods perform based on criteria like rental income, cash on cash return, and occupancy rate.
- See and compare investment properties from up to five cities on one page without having to open multiple tabs using our Property Finder. Mashvisor’s Property Finder gives you access to nearly every real estate market in the country so you can examine a market of your choice.
- Estimate your Airbnb profit and ensure you will get a positive cash flow using our Airbnb calculator. The platform’s Airbnb calculator utilizes rental comps for more accurate and realistic ROI and revenue projections.
Airbnb Rental Calculator
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These are just some benefits you can expect from using our platform. To learn how we can help you make faster and smarter real estate investment decisions, sign up and start your 7-day free trial.
Find Your Next Investment Property in One of the Hottest Airbnb Markets 2023 Using Mashvisor
The ten best short term rental markets affirm Airbnb’s latest report on travel and living:
- More people are traveling to and booking short term rentals in natural settings
- Many travelers are getting away from the big city and flocking toward smaller destinations
- Every short term rental market on the list has easy access to natural features
While this analysis is helpful for investors who are looking for a new investment property now, it may not be as accurate after a month or so. And as a savvy investor, you would want to get up-to-date information whenever you want. Mashvisor can help you with that.
To get access to our real estate investment tools, schedule your demo today and see how Mashvisor can help you make wiser investment decisions.
