As the year 2022 is about to end, most cities around the globe are opening their borders to welcome local and international tourists. Remote working has also been on the rise and it certainly contributed to the increase in short-term rentals, where digital nomad cities were mostly occupied. Airbnb recently revealed that the demand for stays of weeks and months is increasing and are expected to rise further due to the year-round peak season.
While there are surely a handful of available properties in your target area, only a few of them will turn out to be good Airbnb investments in the long run. This is why it’s important to take a look at the performance of markets that generate the most rental income! In this article, we will feature the best short-term rental markets in 2023 to help Airbnb hosts make the wisest investment decisions.
Overview of Short-term Rental Markets in 2022
Based on a recent discovery about Airbnb occupancy rates by city, Airbnb revealed that North America has the highest daily rate in 2021, but EMEA (Europe, Middle East, and Africa) had the highest average length of stay. Let’s go more into detail and take a look at some of the top markets for short term rentals & the most significant STR trends in 2022:
1. Regions with the Best Short-term Rental Markets
It’s a known fact that more travelers these days are booking properties situated within natural environments, because why not! A pretty view where you can unwind and perhaps accomplish work online – the trend for most digital nomads and travelers with families.
Here are some of the top short-term rental markets (reservations) made so far in 2022 according to a short-term rental market analysis report. Interesting discovery: Coastal regions are the top tourist preference and I couldn’t agree more.
| STR reservations | 2021 | 2022 |
|---|---|---|
| Rural areas | 10% | 28% |
| Mountainous areas | 13% | 55% |
| Coastal regions | 34% | 56% |
Similarly, 6 out of 10 Airbnb cities in Florida were recognized to be one of the most preferred states to visit due to its close proximity to the coastal area. These are related to the top 10 most profitable Airbnb cities in the USA during the summertime of 2022.
2. Highest Expenditure of Short-term Rental Markets in the USA
Airbnb’s summer travel trend indicated most of the profitable cities in the USA which have been booked in 72,000 different cities and towns.
| COUNTRY | TOTAL US EXPENDITURE | TOURISTS % |
|---|---|---|
| Turks and Caicos Islands | $1,345,577,284 | 77% |
| Anguilla | $686,411,038 | 55% |
| Virgin Islands | $621,558,569 | 68% |
Since coastal regions have been the most preferred areas for short-term rental bookings, the Turks and Caicos Islands have certainly topped off with the most expenditure. According to Airbtics’ data, here are some of the Airbnb key metrics to take note of for a 1-bedroom apartment (condo) in the Turks and Caicos Islands:
| Annual Revenue | Occupancy Rate | Peak Seasons |
|---|---|---|
| $72,814 | 79% | March - April (100% OR) |
♦ Domestic & International Guests in the Turks and Caicos Islands
Specifically, the top origin cities of guests visiting Turks & Caicos Islands are from New York, Toronto, Chicago, and Atlanta.
Source: Airbtics
2. Anguilla
With Anguilla’s vast selection of beaches, you can never go wrong! As one of the most popular tourist destinations, we used an Airbnb calculator and filtered the 3-bedroom entire house in Anguilla:
| Annual Revenue | Occupancy Rate | Peak Seasons |
|---|---|---|
| $88,679 | 66% | March (100% OR) |
♦ Domestic & International Guests in Anguilla
The top origin countries of guests visiting Anguilla are mainly the United States, Canada, France, UK, and Italy.
3. United States Virgin Islands
US Virgin Islands is ranked as the first country among the best short-term rental markets in Latin America with a median occupancy rate of 70% and a daily rate of $247.
| Annual Revenue | Occupancy Rate | Peak Seasons |
|---|---|---|
| $61,407 | 58% | February (81% OR) |
♦ Domestic & International Guests in the US Virgin Islands
Airbtics shows that the main origin countries of guests in the US Virgin Islands are the US, Puerto Rico, and Canada, with the following guest origin cities:
Most Profitable Short-term Rental Markets in 2023
In order to make the wisest investment decisions, we gathered some of the best and profitable short-term rental markets for investment next year. By basing it on Airbnb key metrics from Airbtics such as the average annual revenue, occupancy rates, and cash on cash return, we were able to come up with the STR markets that will bring long-term profitability for investors.
At the same time, considering the median and average property prices per square foot. Continue reading and look at the short-term rental market data per continent, along with the highest occupancy rate:
1. EUROPE
Europe is responsible for almost half of the world’s tourist arrivals and there’s no doubt about each country’s profitability on Airbnb. While there are certainly the best short-term rental markets for investment in Europe as well as cities with high Airbnb occupancy rates in the UK, let’s take a look at the cities with the highest occupancy rates and daily rates, along with the property price sale and rent, cash-on-cash return, and annual revenue.
♦ Country with the Highest Occupancy Rate in Europe: Luxembourg – 73%
- Monthly Revenue of the Best Neighbourhood in Luxembourg: Luxembourg City Centre: €4,347
- Annual Revenue: €49,795 (2 bedroom apartment/condo)
- Average Daily Rate: €181
- Property Price Sale: €8,574 per square meter
- Average Price Rent: €24,00 per square meter
- Net Rental Yield: 18%
Source for Monthly Revenue: Airbtics
♦ Country with the Highest Daily Rate in Europe: Denmark – €502
- Monthly Revenue of the Best Neighbourhood in Denmark: Copenhagen: €3,546
- Annual Revenue: €62,136 (2-bedroom apartment/condo)
- Average occupancy rate: 35%
- Property Price Sale: €4,279 per square meter
- Average Price Rent: €25,42 per square meter (18,910 DKK)
- Net Rental Yield: 19%
| Property Price Data in Denmark | |||
|---|---|---|---|
| Regions in Denmark | Average Sale | Average Rent (monthly) | Monthly Revenue |
| Aalborg | €20,958 | €5,410 | €1,661 |
| Aarhus/Arhus | €33,201 | €7,762 | €2,405 |
| Copenhagen | €40,803 | €11,030 | €3,288 |
| Esbjerg | €16,066 | €5,024 | €1,211 |
| Horsens | €13,455 | €4,774 | €2,009 |
1. NORTH AMERICA
Known as the third largest continent, North America is certainly the most preferred tourist destination next to Europe. According to Airbtics’ data, the USA has a median occupancy rate of 62%, next to Canada with 63%. While there are the best cities in Canada to invest in real estate, let’s take a look at the countries with the highest daily rate and occupancy rates:
♦ Country with the Highest Occupancy Rate in North America: Canada – 62%
- Monthly Revenue of the Best Neighbourhood in Vancouver: Downtown Vancouver: C$5,908
- Annual Revenue: C$93,945 (2-bedroom apartment/condo)
- Average Daily Rate: C$278
- Property Price Sale: C$748,450
- Average Price Rent: C$828 per square meter
- Net Rental Yield: 55%
| Property Price Data in Canada | |||
|---|---|---|---|
| Regions in Canada | Average Sale | Average Rent (monthly) | Monthly Revenue |
| Vancouver, BC | C$1,036,000 | C$3,707 | C$4,606 |
| Toronto, ON | C$870,000 | C$3,361 | C$2,599 |
| Burnaby, BC | C$977,725 | C$2,791 | C$28,001 |
| Oakville, ON | C$1,516,155 | C$2,736 | C$2,334 |
| Burlington, ON | C$1,089,312 | C$2,631 | C$2,666 |
♦ Country with the Highest Daily Rate: United States of America – $263
- Annual Revenue: $71,706 (3-bedroom apartment/condo)
- Average occupancy rate: 62%
- Property Price Sale: $17,191 per square meter
- Average Price Rent: $222 per square meter
- Net Rental Yield: 24%
| Property Price Data in the United States of America | |||
|---|---|---|---|
| States in the USA | Average Sale | Average Rent (monthly) | Monthly Revenue |
| Hawaii | $1,038,544 | $3,589 | $7,709 |
| District of Columbia | $826,124 | $1,815 | $3,181 |
| California | $816,804 | $1,726 | $3,278 |
| Washington | $640,494 | $2,335 | $3,860 |
| Massachusetts | $611,819 | $2,500 | $3,979 |
3. LATIN AMERICA
Let’s not forget that Latin America offers a vast and rich culture filled with exquisite food and literature, which attracts tourists! Based on Airbtics’ data, Puerto Rico and Bermuda are among the top 3 short-term rental markets in Latin America with 68% and 62% occupancy rates respectively.
♦ Country with the Highest Occupancy Rate in Latin America: US Virgin Islands – 70%
- Annual Revenue: $71,706 (3-bedroom apartment/condo)
- Average Daily Rate: $234
- Property Price Sale in St. Croix: $618,943
- Average Price Rent: $1,292 monthly
- Net Rental Yield: 24%
| Property Price Data in United States Virgin Islands (USVI) | |||
|---|---|---|---|
| Major Islands in the USVI | Average Sale | Average Rent (monthly) | Monthly Revenue |
| St. John | $1,757,411 | $1,633 | $7,553 |
| St. Thomas | $861,503 | $1,204 | $5,036 |
| St. Croix | $618,943 | $1,040 | $2,755 |
Sources for average rent price in USVI and monthly revenue
♦ Country with the Highest Daily Rate in Latin America: Anguilla – $1,240
- Monthly Revenue of the Best Neighbourhood in Anguilla: West End Village: $15,829
- Annual Revenue: $197,164 (3-bedroom apartment/condo)
- Average occupancy rate: 41%
- Property Price Sale: $747 per square foot
- Average Price Rent: $1,500 monthly
| Property Price Data in Anguilla | |||
|---|---|---|---|
| States in Anguilla | Average Sale | Average Rent (monthly) | Monthly Revenue |
| West End Village | $785,000 | $1,824 | $5,479 |
| Long Bay | $345,400 | $2,270 | $7,315 |
| Meads Bay | $750,000 | $2,530 | $8,926 |
3. OCEANIA
Oceania’s great diversity of tropical coral is widely recognized across the globe. It may be the smallest continent, but it offers some of the biggest short-term rental investments! Australia has the highest occupancy and daily rates in the Oceania region, but there are certainly more countries to consider for investment. For instance, Airbnb Airbnb occupancy rates in Australia reveal that Darwin has the highest average monthly revenue among all the Australian cities.
♦ Country with the Highest Occupancy Rate in Oceania: Australia – 56%
- Annual Revenue: A$79,087 (2-bedroom apartment/condo in Darwin)
- Average Daily Rate: A$273
- Property Price Sale: A$1,501 per square meter
- Average Price Rent: A$828 per month
- Net Rental Yield: 80%
| Property Price Data in Australia | |||
|---|---|---|---|
| Capital Cities in Australia | Average Sale | Average Rent (weekly) | Monthly Revenue |
| Adelaide | A$748,000 | A$430 | A$4,099 |
| Melbourne | A$948,000 | A$444 | A$3,543 |
| Perth | A$849,000 | A$472 | A$3,363 |
| Brisbane | A$885,633 | A$476 | A$3,228 |
| Hobart | A$782,500 | A$499 | A$5,122 |
| Darwin | A$569,000 | A$548 | A$5,095 |
| Sydney | A$994,000 | A$582 | A$2,450 |
| Canberra | A$872,000 | A$620 | A$3,838 |
Sources for average rent price in Australia and monthly revenue
♦ Country with the Highest Daily Rate in Oceania: New Zealand – $163
- Annual Revenue: $70,152 (3-bedroom apartment/condo)
- Average occupancy rate: 39%
- Property Price Sale: $810,000
- Average Price Rent: $1,467 monthly
| Property Price Data in New Zealand | |||
|---|---|---|---|
| Capital Cities in New Zealand | Average Sale | Average Rent (weekly) | Monthly Revenue |
| Auckland | $748,000 | $430 | $4,099 |
| Bay of Plenty | $500,000 | $2,206 | $1,808 |
4. AFRICA
Africa offers various ethnic tourist destinations such as Victoria Falls, Nile River, and many tropical beaches with geological wonders. Airbtics’ data shows that South Africa and Cape Verde have a similar median daily rate of $67 and an occupancy rate of 23%.
♦ City with the Highest Occupancy Rate in Africa: Seychelles – 50%
- Annual Revenue: $47,749 (2-bedroom apartment/condo)
- Average Daily Rate: $219
- Property Price Sale: $980,000 (0.49 Acres)
- Average Price Rent: $1,852 per month
- Net Rental Yield: 32%
Property price sources for Lagos & Kinshasa
♦ Countries with the Highest Daily Rate in Africa: Mauritania – $178
- Annual Revenue: A$70,152 (3-bedroom apartment/condo)
- Average occupancy rate: 39%
- Property Price Sale: A$810,000
- Average Price Rent: $1,467 monthly
Conclusion: Finding The Best STR Markets
There are several options to choose from when it comes to the best short-term rental markets across the globe. And by ‘best’, we mean it assures long-term profitability! The Airbnb metrics of STR markets presented in this blog can serve as your guideline towards profitable investment in 2023.
With the help of Airbtics’ Airbnb calculator, creating an analysis, comparing one market to another, and in-depth research is no longer necessary! Get ahead of your competitors now and discover the hottest short-term rental markets in your area.
