What are the Best Short-Term Rental Markets to Invest In 2025?
Short-Term Rentals Have Evolved — And That’s Good News for Investors
Gone are the days when short-term rental (STR) investing felt like the Wild West.
Today, the market is backed by robust data, established guest behaviors, and smarter investment strategies.
For investors, this shift means more predictable income streams — and easier access to financing your next property.
Using Real Data to Find the Right Markets
That’s why I teamed up with Host Financial, leveraging insights from AirDNA and Zillow, to spotlight five promising STR markets for 2025.
We focused on locations showing strong demand, healthy growth trends, and — most importantly — outstanding gross rental yields.
Gross Rental Yield Formula:
(Annual Revenue ÷ Median Home Price) × 100
For example:
• Median home price: $300,000
• Annual STR revenue: $45,000
• Gross Rental Yield = (45,000 ÷ 300,000) × 100 = 15%
A 15% yield indicates strong income relative to the purchase price — especially crucial when evaluating STR opportunities.
Even better, financing options like DSCR (Debt Service Coverage Ratio) loans from Host Financial can qualify you based on the property’s projected short-term income, not just long-term rental comps.
Ready to explore? Here are five high-performing STR markets to watch in 2025 — and how to finance them smartly.
1. Shenandoah, Virginia
• Market Score: 94
• Annual Revenue: $42,000
• Average Daily Rate (ADR): $266.51
• Revenue Per Available Room (RevPAR): $128.94
• Median Home Price: $255,593
• Gross Yield: 16.4%
Why Shenandoah?
Surrounded by stunning natural beauty and close to Shenandoah National Park, this region boasts high revenue growth potential despite moderate occupancy rates. Affordable prices and strong seasonal demand make it a top choice for nature-focused rentals.
Financing Tip:
Host Financial can help you leverage STR-specific income projections to qualify — even when traditional rental comps are weak.
2. Columbia, South Carolina
• Market Score: 98
• Annual Revenue: $33,900
• ADR: $201.50
• Occupancy: 57%
• Median Home Price: $232,153
• Gross Yield: 14.6%
Why Columbia?
A dynamic midsized city with a booming college, capital, and business scene, Columbia scores high on revenue growth and seasonality. Family-sized homes particularly shine here, catering to visiting groups and event travelers.
Financing Tip:
Focus on larger homes with multiple bedrooms and bold design. Host Financial’s loan products fit well with bigger properties that bring in larger group bookings.
3. Poconos, Pennsylvania
• Market Score: 60
• Annual Revenue: $53,200
• ADR: $394.14
• RevPAR: $164.27
• Median Home Price: $246,669
• Gross Yield: 21.5%
Why the Poconos?
Think ski trips, family reunions, and weekend getaways. Homes with luxury amenities like hot tubs and game rooms command impressive nightly rates. Despite slightly lower occupancy, the RevPAR is one of the strongest nationally.
Financing Tip:
Host Financial offers jumbo DSCR loans ideal for high-income properties like these — particularly those generating $50K+ annually.
4. Tulsa, Oklahoma
• Market Score: 99
• Annual Revenue: $28,300
• ADR: $173.92
• RevPAR: $95.42
• Median Home Price: $205,014
• Gross Yield: 13.8%
Why Tulsa?
Tulsa combines urban charm, cultural tourism, and affordable property prices. Occupancy rates and RevPAR have steadily risen, making it a strong value-play for investors willing to add smart marketing and stylish furnishings.
Financing Tip:
Tulsa is a dual-threat market. Host Financial can approve you based on either projected STR income (Airbnb model) or long-term rental comps — offering financing flexibility rare in today’s market.
5. Destin, Florida
• Market Score: 91
• Annual Revenue: $72,200
• ADR: $395.52
• RevPAR: $245.60
• Median Home Price: $577,366
• Gross Yield: 12.5%
Why Destin?
This iconic Emerald Coast destination consistently delivers strong rental income, especially in the luxury tier. With annual revenue growth topping 11%, investors targeting higher-end guests continue to thrive here.
Financing Tip:
For a pricier market like Destin, Host Financial’s jumbo DSCR and second-home loans are your best bet. Early prequalification is key to winning competitive offers.
STR Financing: Why It Matters Who You Work With
Short-term rental lending isn’t one-size-fits-all. Different markets may require permits, STR income verification, or LLC ownership structures.
That’s why it’s essential to partner with lenders like Host Financial who specialize in vacation rentals.
With Host Financial, you can:
• Use STR projections instead of traditional LTR comps.
• Structure loans properly under LLCs or personal names as needed.
• Get fast prequalifications to move quickly in hot markets.
• Navigate local permit or zoning requirements with confidence.
How to Set Yourself Up for STR Success in 2025
Winning in today’s STR market means more than just picking the right house.
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