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Category: Off-Topic & Lounge
By: Brittany Simmons
Reply by Kevin O'Brien:
Data analyst here with access to AirDNA and AllTheRooms. The numbers actually tell a more nuanced story than either "Airbnb is dead" or "record highs" headlines suggest. National averages: US STR listings grew from about 1.4M to 1.7M between 2023-2025, probably hitting 1.8M by end of 2026. Average daily rates declined from $189 to around $170 (more supply = rate compression). Average occupancy slipped from 56% to roughly 50%. Revenue per available listing is down about 15% from the 2022 peak. But here's the thing — national averages are meaningless for individual investors. What matters is your specific market. Gatlinburg added 35% more listings in two years and ADR dropped 12%. Joshua Tree is up 45% in listings with ADR down 18% — genuinely oversaturated. But Blue Ridge, GA only grew 25% and held steady on rates. Destin, FL only grew 15% and still runs 58% occupancy. Rural Midwest markets barely grew and rates actually went UP. The pattern is pretty clear: markets that went viral on TikTok and Instagram are saturated. "Boring" markets nobody talks about are still underserved. The hosts getting squeezed are running generic listings competing purely on price. Differentiated properties — unique stays, killer views, specific niches, hot tubs in mountain markets — are still doing well even in "oversaturated" areas. Should you invest in 2026? Yeah, but the playbook has changed from 2020-2022. You need to analyze at the market level, not the national level. Buy properties with some kind of moat — a view, a unique structure, lake access, something competitors can't easily replicate. Underwrite conservatively (I use 60-65% of AirDNA estimates). And make sure the property works as an LTR or mid-term if STR doesn't pan out. The gold rush is over but the sustainable business era has begun. That's honestly better for serious investors who can operate efficiently and aren't just hoping to get rich quick.
Reply by Daniel Kowalski:
I'll add the regulation angle, which is the other huge factor people forget about. Cities keep restricting or banning STR. NYC effectively killed non-owner-occupied STR. Dallas added new permit requirements with 24-hour noise limits. San Diego capped licenses in certain neighborhoods. Nashville closed non-owner-occupied permits in residential zones. Denver has a primary residence requirement. Maui went strict after the fires. What this actually means for investors: if you already have a permit in a restricted market, that permit IS your moat. New competition can't get in. Regulated markets have lower supply growth which is better for existing licensed hosts. For new investors, look at markets where the regulations actually protect you by limiting future supply — not markets with zero rules where anyone can jump in next week. The sweet spot markets for 2026 investing have moderate regulation (permits available but not a free-for-all), growing tourism and population, they're not TikTok-famous, they have strong mid-term backup demand near hospitals or military bases or universities, and property prices are still reasonable enough for cash-on-cash to make sense. Places like Asheville NC, Branson MO, Gulf Shores AL, Fredericksburg TX, Door County WI, the Poconos. Don't chase saturated markets hoping your listing will somehow be "different." Go where the math works.