Unlocking Vacation Home Riches: Data-Driven Insights into Short-Term Rental Hotspots
The vacation rental market is booming, but identifying truly profitable locations requires a data-driven approach. This analysis dives into key metrics like Average Daily Rate (ADR), occupancy rates, and estimated Return on Investment (ROI) to pinpoint potential goldmines for short-term rental investors.
ADR and Occupancy: The Dynamic Duo
A high ADR combined with strong occupancy is the recipe for rental success. Let's examine how different cities stack up:
- Phoenix, CO boasts a high ADR of $394, but its occupancy rate is only 60%. This suggests potential for increased marketing efforts to boost occupancy and maximize revenue.
- San Antonio, CO, on the other hand, shows a strong occupancy rate of 87% with an ADR of $349. This combination contributes to a compelling estimated ROI of 14.66%.
- Nashville, CO presents an interesting case. One dataset shows an ADR of $301 with a 77% occupancy rate, while another Nashville, CO dataset shows an ADR of $292 with a higher occupancy of 85%. This difference highlights the importance of granular data analysis within a single city.
- Dallas, FL has a lower ADR of $190 but maintains a solid occupancy rate of 82%, resulting in an estimated ROI of 12.58%.
ROI Deep Dive: Where the Money Is
While ADR and occupancy are crucial, the ultimate measure of success is ROI. Here's a look at some top performers:
- Seattle, GA leads the pack with an impressive estimated ROI of 14.72%, supported by an ADR of $261 and an occupancy rate of 84%.
- San Antonio, CO closely follows with an estimated ROI of 14.66%, driven by its high occupancy rate of 87% and an ADR of $349.
- Nashville, WA shows an estimated ROI of 13.80%, with an ADR of $181 and an occupancy rate of 83%.
Comparing Cities: A Data-Driven Showdown
Let's directly compare a few cities to illustrate the power of data-driven decision-making:
- Houston, WA has an ADR of $318 but a lower occupancy rate of 60%, resulting in an estimated ROI of 10.96%. In contrast, Raleigh, WA, with an ADR of $291 and a slightly higher occupancy rate of 62%, boasts a significantly higher estimated ROI of 20.00%. This suggests that Raleigh, WA may have more favorable market conditions or lower operating costs.
- Comparing two locations named Seattle, OR, we see one with an ADR of $179 and occupancy of 66% resulting in an estimated ROI of 11.42%, while another has an ADR of $252 and occupancy of 78% resulting in an estimated ROI of 7.39%. This highlights the importance of location, even within the same city and state.
- Denver, GA has an ADR of $253 and an occupancy rate of 78%, leading to an estimated ROI of 9.62%. This is lower than other cities with similar ADR and occupancy rates, suggesting potentially higher operating costs or increased competition.
Data Table: Vacation Rental Performance by City
Here's a summary of the key metrics for each city:
| City |
State |
ADR |
Occupancy |
Estimated ROI |
| Nashville |
WA |
$181 |
83% |
13.80% |
| San Antonio |
CO |
$349 |
87% |
14.66% |
| Dallas |
FL |
$190 |
82% |
12.58% |
| Nashville |
CO |
$301 |
77% |
12.99% |
| Denver |
TX |
$388 |
83% |
9.48% |
| Austin |
CO |
$241 |
88% |
10.01% |
| Seattle |
GA |
$261 |
84% |
14.72% |
| Seattle |
OR |
$179 |
66% |
11.42% |
| Seattle |
OR |
$252 |
78% |
7.39% |
| Houston |
WA |
$318 |
60% |
10.96% |
| Raleigh |
WA |
$291 |
62% |
20.00% |
| Nashville |
CO |
$209 |
75% |
11.37% |
| Nashville |
CO |
$292 |
85% |
19.27% |
| Denver |
GA |
$253 |
78% |
9.62% |
| Phoenix |
CO |
$394 |
60% |
6.92% |
Conclusion: Data-Driven Decisions for Vacation Rental Success
Investing in vacation rentals requires careful consideration of various factors. By analyzing key metrics like ADR, occupancy, and ROI, investors can identify locations with the highest potential for profitability. While some data is unavailable, the available data provides valuable insights for making informed decisions and maximizing returns in the dynamic short-term rental market.
