Vacation Rental Investors Boost Market Research as Returns Cool

Short‑term rental investors are confronting a dual threat: cooling returns and tightening regulations that squeeze profitability and raise loan‑qualification hurdles. Platforms such as Airbnb have broadened access to vacation‑rental investing, but state and local authorities are increasing tax‑compliance checks, licensing requirements and occupancy caps.

In response, investors are making market research essential. AirDNA’s 2025 outlook shows average ROI for short‑term rentals fell to 10.3% by year‑end, far below the 30.8% peak in 2021, while the typical STR premium remains around $1,000 per month. Property prices are declining in traditional vacation markets, dropping about 10% in Punta Gorda, Florida, and 6.7% in Pigeon Forge, Tennessee, creating both opportunities and risks for buyers and sellers alike.