Tampa Tops List of Best U.S. Cities for Investing in Short-Term Rentals

Discover why Tampa, Florida, has been named the top city for investing in short-term rentals, while San Jose, California, is deemed the riskiest market in America. Read the latest study findings here.

According to a recent study conducted by Clever Real Estate in partnership with Rabbu.com, Tampa has been identified as the top U.S. city for investing in short-term rentals. On the other hand, San Jose, California, has been deemed the riskiest short-term rental market in America. The study took into account various metrics such as median home prices, occupancy rates, and changes in property values to rank Airbnb investment markets across the country.

Tampa has emerged as a standout city with a remarkable 71.6% increase in property values over the past five years, which is 55% higher than the median city in the study. The metro area boasts a substantial 16,020 property listings, triple the median, along with a solid 44.8% Airbnb occupancy rate and an average annual Airbnb revenue of $52,705. The top 10 U.S. cities for investing in short-term rentals include Tampa, FL; Orlando, FL; Jacksonville, FL; Boston, MA; Miami, FL; Buffalo, NY; Columbus, OH; Chicago, IL; Providence, RI; and Kansas City, MO.

Conversely, San Jose has been identified as the worst short-term rental city, with a staggering median home sale price of $1,447,955, more than four times the average. With just 1,296 listed properties, a significant 76% less than the median, San Jose has the lowest Rabbu return on investment score in the nation. The 10 worst short-term rental markets in the U.S. include San Jose, CA; Birmingham, AL; San Antonio, TX; Houston, TX; Sacramento, CA; Raleigh, NC; Riverside, CA; San Francisco, CA; Oklahoma City, OK; and Pittsburgh, PA.

In addition to the study findings, Clever also conducted a survey of 1,000 Americans, revealing that 76% have a positive view of Airbnbs. Approximately 60% of respondents believe that short-term rentals are nicer than hotels, and 67% find them more comfortable. However, the survey also highlighted concerns among respondents, with 96% citing downsides to short-term rentals such as misleading property descriptions, a lack of on-site assistance, and safety issues. Only 44% of respondents perceive Airbnbs as safer than hotels, a concern that may be exacerbated by rising crime rates.

The study sheds light on the varying landscape of short-term rental markets across the U.S., with Tampa emerging as a promising investment destination while San Jose presents significant risks for investors. As the popularity of short-term rentals continues to grow, it is essential for investors to carefully evaluate market conditions and potential risks before making investment decisions.