Best Cities for Airbnb Investment 2025

best cities for Airbnb 2023

Updated Mar’25

In the past decade, short-term rentals have become a more profitable strategy for most markets worldwide than renting property long term. But not all markets are created equal, so it’s crucial to study the property’s location to ensure it’s optimal for vacation rental investment.

If you plan to buy a short-term rental property in the US to make money from real estate this year, you will want to know where the best cities for Airbnb investment in 2025 are located.

Any effective investment strategy should be based on reliable data to help you make an informed decision, so you need actionable insights from a reliable source.

Mashvisor, a company that helps real estate investors find lucrative investment properties through an online AI analytics platform, has analyzed Airbnb data from the top US markets.

They have selected the best locations for Airbnb investment based on certain criteria using key Airbnb metrics, such as occupancy rate, daily rate, monthly rental income, and cash-on-cash return.

Let’s examine their findings to discover the best places to buy vacation rental property in the US in 2025.

Top 25 Cities by Airbnb Rental Income

Below is a table that provides data about the top 25 vacation rental investment locations in the US based on monthly rental income (as of March 2025).

Table1. Top 25 Cities by Airbnb Income

StateCityCountyMedian Property PriceMonthly Rental IncomeCash on Cash Return (%)Daily Rate ($)Occupancy Rate (%)
HIKapoleiHonolulu1 357 78412 5906.7163256
CANapaNapa3 024 96711 5313.6849370
CASunset BeachOrange3 653 00010 9831.5431970
CAVilla ParkOrange2 969 60010 7132.0723084
CAWest HillsLos Angeles1 159 47910 0885.9330580
FLKey WestMonroe2 072 2839 8693.7251258
CAValley VillageLos Angeles1 922 9909 8004.5634382
HIKOLOAKauai2 789 5939 7243.7343166
CATopangaLos Angeles2 114 5719 6473.1530565
CAWestlake VillageVentura1 861 6659 3633.6531678
CAWoodland HillsLos Angeles1 221 9868 8375.0930180
CAWinnetkaLos Angeles1 176 5758 7806.2732281
FLSt. George IslandFranklin2 072 8008 7583.642661
CASonomaSonoma2 942 5008 7192.7160653
CAWindsor HillsLos Angeles1 646 2448 4382.9723281
CASanta BarbaraSanta Barbara2 049 7418 3982.8939963
CASan RafaelMarin1 653 6328 3343.3121369
CAVenturaVentura1 384 4578 2084.9526184
COMt. Crested ButteGunnison3 359 8898 1592.0534942
FLBig CoppittMonroe930 5718 1256.5639972
CAEncinitasSan Diego1 668 0198 1153.3843057
CAVan NuysLos Angeles1 050 1578 0585.8934083
CADana PointOrange3 789 4458 0411.5738357
CARedondo BeachLos Angeles1 788 3888 0212.7652355
FLAnna MariaManatee2 965 8578 0051.3251751

Note that most cities with the highest monthly Airbnb income included on this list are in California. There are also seven cities in Hawaii and one city in Florida. There is a high demand for short-term rentals in these states.

As you can see, all the cities with the highest monthly Airbnb income have median property prices of a few million dollars. Such prices might be too high for aspiring Airbnb hosts.

That’s why Mashvisor also created a list of the cities based on the Airbnb cash-on-cash return. This metric is used to evaluate an investment property’s current or future profitability. It’s calculated by taking the total rental income generated by a property and dividing it by the initial cash investment made to buy that property.

Best Cities for Airbnb Investment in the US

Here is a list of the top 25 US cities with the highest Airbnb cash-on-cash return rate, according to Mashvisor’s data.  

Table2. Top 25 Cities by Airbnb COC Return

StateCityCountyMedian Property Price ($)Monthly Rental IncomeCash on Cash Return (%)Daily Rate ($)Occupancy Rate (%)
PABrighton HeightsAllegheny240 8832 8257.4516249
LAMarreroJefferson356 7383 8607.4323956
MOColumbiaBoone412 0652 6157.3416752
NVSilver SpringsLyon321 7453 3947.318760
FLZephyrhillsPasco339 9053 8617.2613268
WIWisconsin DellsAdams426 9084 6027.2431145
FLSweetwaterMiami-Dade515 1295 4187.2119470
NCAlmondGraham326 8803 5377.1923849
OHGenevaAshtabula364 8003 9207.1723941
MIHazel ParkOakland258 6443 0887.1617253
OKWarr AcresOklahoma225 8802 6457.115445
SCCayceLexington309 5223 1057.0514452
FLBonifayHolmes461 7654 4697.0126549
VAMadison HeightsAmherst292 6442 7686.9914153
KYBowling GreenWarren467 0204 1106.9313245
CAVisaliaTulare443 5444 5236.916486
FLWinter HavenPolk395 8154 0196.8616277
FLDestinOkaloosa339 2413 3626.8227952
FLHialeah GardensMiami-Dade541 0005 0396.816667
LAGretnaJefferson350 9933 6316.7926345
TXRiver OaksTarrant307 0093 4116.7820458
SCWest ColumbiaLexington310 6043 1236.7616353
WVFayettevilleFayette386 3383 5566.7420947
HIKapoleiHonolulu1 357 78412 5906.7163256
FLSun City CenterHillsborough300 2813 2356.6724656

Mashvisor emphasizes that although these cities have a lower rental income range than those included in the previous list, they have low median property prices. That makes vacation rental properties in these cities accessible for beginner investors.

Moreover, the high cash-on-cash returns (or the cash flow divided by the amount of cash initially invested) mean the investors can recoup their investments faster.

The higher the cash-on-cash return, the healthier the property investment. That’s why the top 25 cities by Airbnb COC return can be considered the best cities for Airbnb investment in the US.

Things to Consider When Choosing the Best Markets to Invest in Airbnb Rental Property

Of course, these lists provide only a broad view based on average values. So it’s essential to consider more specific factors when deciding whether you should buy property in any of the top vacation rental investment locations in the US.

Essential factors to consider are supply and demand and competition. Let’s look at this table that showcases the ten states with the highest number of active Airbnb listings.

Table 3. 10 States with the Highest Airbnb Saturation

StateMedian Property PriceNumber of ListingsMonthly Rental Income ($)Cash on Cash Return (%)Cap Rate (%)Daily Rate ($)Occupancy Rate (%)
FL752 903104 3083 5533.263.3122058
CA1 207 81255 4415 0083.063.0826361
TX482 97847 7492 8663.493.5619351
NC533 96735 6343 1524.074.1318156
NY884 14427 3194 4183.123.1629047
CO972 92022 5423 6273.363.429954
AZ719 09120 9123 2343.393.4419256
SC503 39220 3823 0003.853.9126348
WA690 38318 7633 4843.153.1919562
TN523 78317 5592 8533.873.9326651

The interesting thing to note here is that these US states have lower cash-on-cash returns. Mashvisor explains that it’s because their markets are oversaturated. So it’s always important to analyze the market data before making an investment decision instead of just looking at whether an area gets a lot of tourists.

Finding a location that is not too saturated with vacation rentals is crucial. Before you buy a rental property for your STR business, you should study recent Airbnb data and analytics and research the Airbnb regulations regarding licensing and taxing in the city of your choice. Make sure that it’s legal to rent out on Airbnb in this city.

Then you need to perform a neighborhood comparison to determine areas that have the potential to generate high income monthly. You should look for neighborhoods that fit your budget and consider such statistical data as Airbnb rental income, occupancy rate, and cash-on-cash return.

When you find the area where Airbnb is most profitable in the city, you can start searching for an investment property that offers high ROI when rented on a short-term basis.

What’s Next?

Making money on Airbnb starts with buying a property in a market profitable for short-term rentals. If you want to join the millions of successful Airbnb hosts, we hope our article will help you better understand where to look for a top-performing rental property to maximize your ROI.

But no matter which of the best cities for Airbnb investment 2025 you choose for buying your next STR property, it’s critical to prepare it for the rental business. Our free guide will give you hands-on advice and save you from unnecessary operational expenses.

As a host, you’ll have a lot of responsibilities, so you’ll need powerful vacation rental software to automate your processes and increase the efficiency of your business.

Hospitable does everything you would expect from vacation rental management software and can help you automate almost every aspect of your STR business. We’ll protect you from double bookings, keep your pricing in sync between multiple platforms, schedule messages based on triggers and events, streamline team management, and help you create your own direct booking website in minutes.

Still, we have a few unique features to surprise you:

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With Hospitable, you can simplify your hosting routine, streamline your operations, manage all your listings in one place hassle-free, and save tons of time. It’ll be easier to become a successful Airbnb host, provide guests an excellent experience, and scale your short-term rental business faster than your competitors.

Final Thought

The United States offers many opportunities for aspiring real estate investors, although not all locations are optimal for investing in short-term rentals. That’s why it’s essential to do thorough research to find areas that are best for investing in Airbnb.

Hopefully, the list of the best cities for Airbnb investment in the US will help you find the right property in the right location. When doing your research, you should also ensure that your preferred city is a popular tourist destination and check the other metrics, such as monthly rental income, occupancy rate, and cash-on-cash return. 

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Discover the simple solutions to prepare your place for short-term rentals and reduce operational costs in your business.
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