Airbnb real estate investing is packed with opportunities to have properties with positive cash flow. Still, there is an issue that looms around when investing through the platform: Airbnb legal issues. Some cities, like San Francisco, slap Airbnb hosts with high occupancy taxes.
Other cities, like New York, ban the platform altogether. Most cities, however, are much more accepting of Airbnb. There are way more Airbnb friendly cities than Airbnb opposing ones.
Having little Airbnb legal issues and reasonable regulation is a balancing act many cities manage well. Still, even among Airbnb friendly cities, some place more lenient and reasonable legislation than others. So, where are the most Airbnb friendly cities?
The most Airbnb friendly cities, according to R Street Institute’s Roomscore Report, which grades large US cities based on their short-term rental regulations, are Cleveland, OH, Columbus, OH, Dallas, TX, Indianapolis, IN, Louisville, KY, and San Diego, CA.
When buying a property for Airbnb, these cities may not be the best in terms of Airbnb rental income or affordability. Still, these Airbnb friendly cities check out pretty well in these two aspects. This will make Airbnb hosts doubly happy for sure.
All the data for the Airbnb friendly cities provided are from Mashvisor’s real estate market and investment property analysis. The Airbnb data presented are merely averages. Data for an actual Airbnb property will likely be higher. Be sure to find the best place to buy Airbnb property in any city through Mashvisor! Without further ado, here are the most Airbnb friendly cities and their top two neighborhoods!
Cleveland, Ohio
- Median Property Price: $248,182
- Airbnb Rental Income: $565
- Airbnb Cash on Cash Return: 1.71%
- Airbnb Cap Rate: 1.71%
Kicking off the list of Airbnb friendly cities is Cleveland. The city requires Airbnb hosts to register for a business license. A small 3% transient occupancy tax may also apply to Airbnb properties, as well as a 5.5% bed tax. These requirements do not derail buying a property for Airbnb in the city.
Investment properties in the city are affordable, yet another plus for Airbnb hosts. As a whole, Cleveland may not have the highest Airbnb rental income. Many parts of the city, however, break this rule. The Downtown neighborhood, for instance, is the best place to buy Airbnb property in Cleveland.
Downtown
- Median Property Price: $397,450
- Airbnb Rental Income: $2,658
- Airbnb Cash on Cash Return: 3.55%
- Airbnb Cap Rate: 3.55%
- Average Airbnb Occupancy Rates: 35%
Ohio City
- Median Property Price: $294,450
- Airbnb Rental Income: $1,565
- Airbnb Cash on Cash Return: 2.24%
- Airbnb Cap Rate: 2.24%
- Average Airbnb Occupancy Rates: 36%
Columbus, Ohio
- Median Property Price: $204,220
- Airbnb Rental Income: $471
- Airbnb Cash on Cash Return: 1.72%
- Airbnb Cap Rate: 1.72%
Next on the list of the most Airbnb friendly cities is another Ohioan city: Columbus. Like Cleveland, Columbus is one of the best when buying a property for Airbnb based off affordability. The average Airbnb rental income for the city may be low, but many of its neighborhoods provide many opportunities for Airbnb positive cash flow. The best place to buy Airbnb property in Columbus is Indianola Terrace.
Indianola Terrace
- Median Property Price: $149,900
- Airbnb Rental Income: $1,995
- Airbnb Cash on Cash Return: 10.81%
- Airbnb Cap Rate: 10.81%
- Average Airbnb Occupancy Rates: 48%
Schumacher Place
- Median Property Price: $313,400
- Airbnb Rental Income: $2,231
- Airbnb Cash on Cash Return: 5.54%
- Airbnb Cap Rate: 5.54%
- Average Airbnb Occupancy Rates: 44%
Dallas, Texas
- Median Property Price: $322,898
- Airbnb Rental Income: $623
- Airbnb Cash on Cash Return: 0.97%
- Airbnb Cap Rate: 0.97%
Dallas has had quite a year for Airbnb investing that some may claim that it was the best city for Airbnb investment. A huge reason for this is that it is among the most Airbnb friendly cities. Without a doubt, the best place to buy Airbnb property in Dallas is Northwest Dallas. Find out more about how much you can earn from your short-term rental property by using an Airbnb calculator.
Northwest Dallas
- Median Property Price: $199,000
- Airbnb Rental Income: $1,551
- Airbnb Cash on Cash Return: 4.24%
- Airbnb Cap Rate: 4.24%
- Average Airbnb Occupancy Rates: 23%
Oak Cliff
- Median Property Price: $350,000
- Airbnb Rental Income: $1,623
- Airbnb Cash on Cash Return: 2.52%
- Airbnb Cap Rate: 2.52%
- Average Airbnb Occupancy Rates: 41%
Indianapolis, Indiana
- Median Property Price: $188,374
- Airbnb Rental Income: $758
- Airbnb Cash on Cash Return: 3.56%
- Airbnb Cap Rate: 3.56%
Indianapolis is the best city for Airbnb investment on this list based on affordability. Its low property prices and high rental income make way for positive cash flow Airbnb properties. You can’t go wrong investing in either of the two following neighborhoods in Indianapolis.
Near Southside
- Median Property Price: $254,900
- Airbnb Rental Income: $2,619
- Airbnb Cash on Cash Return: 14.51%
- Airbnb Cap Rate: 14.51%
- Average Airbnb Occupancy Rates: 42%
Fountain Square
- Median Property Price: $290,000
- Airbnb Rental Income: $2,949
- Airbnb Cash on Cash Return: 11.48%
- Airbnb Cap Rate: 11.48%
- Average Airbnb Occupancy Rates: 43%
Louisville, Kentucky
- Median Property Price: $241,684
- Airbnb Rental Income: $546
- Airbnb Cash on Cash Return: 1.98%
- Airbnb Cap Rate: 1.98%
Like many Airbnb friendly cities, Louisville requires Airbnb hosts to obtain a business license. What may be unusual is that hosts cannot have the property fully occupied and that hosts must be 25 miles within the property when rented to Airbnb guests.
Nonetheless, Louisville is one of most Airbnb friendly cities, and one of the more lucrative ones, too. In fact, it is the best city for Airbnb investment based on income on this list.
Butchertown
- Median Property Price: $230,000
- Airbnb Rental Income: $3,750
- Airbnb Cash on Cash Return: 15.28%
- Airbnb Cap Rate: 15.28%
- Average Airbnb Occupancy Rates: 43%
Clifton
- Median Property Price: $242,200
- Airbnb Rental Income: $4,393
- Airbnb Cash on Cash Return: 17.1%
- Airbnb Cap Rate: 17.1%
- Average Airbnb Occupancy Rates: 35.6%
San Diego, California
- Median Property Price: $686,790
- Airbnb Rental Income: $1,374
- Airbnb Cash on Cash Return: 1.14%
- Airbnb Cap Rate: 1.14%
San Diego is in no shortage of Airbnb guests. The city is one of the most popular tourist destinations, both on a national and global scale. Luckily, it is also one of the most Airbnb friendly cities, making Airbnb properties a profitable form of investment. Aside from a couple of business licenses requirements, San Diego’s Airbnb regulation is very smooth.
North Park
- Median Property Price: $345,000
- Airbnb Rental Income: $1,762
- Airbnb Cash on Cash Return: 2.13%
- Airbnb Cap Rate: 2.13%
- Average Airbnb Occupancy Rates: 44%
Golden Hill
- Median Property Price: $451,950
- Airbnb Rental Income: $2,141
- Airbnb Cash on Cash Return: 3.22%
- Airbnb Cap Rate: 3.22%
- Average Airbnb Occupancy Rates: 43%
For more on everything related to Airbnb real estate investing, like how to increase Airbnb rental income or how to attract more Airbnb guests, visit Mashvisor!