The Zip Code Effect: How Neighborhood Characteristics Impact Short-Term Rental Returns

In the world of short-term rentals, understanding the impact of neighborhood characteristics on returns is crucial for investors and hosts alike. By analyzing data from various cities, we can identify patterns and trends that can inform investment decisions. In this article, we'll delve into the zip code effect and explore its impact on short-term rental returns.

Let's start with a comparison of median prices. In New York, NY, the median sale price is $825,000 with homes typically staying on the market for 74 days. When comparing to Los Angeles, CA, which has a median price of $736,000, we can see a difference of $89,000. This discrepancy highlights the importance of understanding local market conditions and prices.

Looking at the number of homes sold, we can see that New York, NY has 2381 homes sold, while Los Angeles, CA has only 78. This significant difference in sales volume suggests that Los Angeles is a more competitive market, with a higher demand for properties. For more detailed information, check out our short term analysis.

Another key metric to consider is the days on market. In New York, NY, homes stay on the market for 74 days, while in Los Angeles, CA, they stay on the market for 43 days. This indicates that Los Angeles has a faster sales pace, with properties selling more quickly.

Now, let's take a look at some of the high-end markets. In Sturgis, South Dakota, the median sale price is a staggering $369,375,000, with only 1 home sold. In contrast, Indian Creek, Florida, has a median sale price of $79,000,000, with only 1 home sold. These markets are clearly outliers, with extremely high prices and low sales volumes.

When it comes to short-term rental returns, we need to consider factors like occupancy rates, average daily rates, and revenue per available room. By analyzing these metrics, we can gain a better understanding of the potential returns on investment in different neighborhoods. For more detailed information, check out our short term analysis.

This concept is also explored in our article on Utah's evolving short-term rental market, where we examine the top markets and trends in the region.

For example, in New York, NY, the median sale price is $825,000 with homes typically staying on the market for 74 days. In contrast, Los Angeles, CA has a median price of $736,000, with homes staying on the market for 43 days. By analyzing these numbers, we can see that Los Angeles is a more competitive market, with a higher demand for properties. For more detailed information, check out our short term analysis.

When it comes to short-term rental returns, we need to consider factors like occupancy rates, average daily rates, and revenue per available room. By analyzing these metrics, we can gain a better understanding of the potential returns on investment in different neighborhoods.

For instance, in the high-end market of Sturgis, South Dakota, the median sale price is $369,375,000, with only 1 home sold. In contrast, Indian Creek, Florida, has a median sale price of $79,000,000, with only 1 home sold. These markets are clearly outliers, with extremely high prices and low sales volumes.