You may have heard that the Airbnb industry is poised for recovery in 2021, once a COVID-19 vaccine has been administered to most of the general public. But in some real estate markets and for some Airbnb hosts, the short-term rental business only faced an initial slowdown during lockdowns. One such market is the Airbnb Memphis real estate market. The evidence is in Mashvisor’s data:
Mashvisor’s Data for Airbnb Memphis Rental Properties
According to Mashvisor’s Airbnb data from December 2020, local hosts were enjoying a high Airbnb occupancy rate and consequently, high daily rates and returns:
- Average Airbnb Daily Rate: $121
- Monthly Airbnb Rental Income: $2,307
- Airbnb Cash on Cash Return: 3.9%
- Airbnb Occupancy Rate: 62%
Mashvisor’s data is pulled from the Airbnb site and all of our calculations have been verified by real hosts.
While real estate investors will have to keep an eye on current and future coronavirus restrictions in the city, buying an Airbnb Memphis property in 2021 is forecast to be a profitable investment. If hosts have continued to generate revenue during the pandemic, then there is little doubt that Airbnb Memphis rentals won’t quickly return to their pre-COVID glory as the vaccine rolls out in Shelby County.
Related: Is Owning an Airbnb Profitable?
But before you make a move and invest in Airbnb Memphis, you have to conduct a neighborhood analysis. This will help you identify top neighborhoods for making money with an Airbnb rental property in the Memphis housing market in 2021.
Another option is to let Mashvisor conduct the analysis for you. We used our Airbnb analytics to identify the 5 hottest Memphis neighborhoods for buying a vacation rental property.
Top 5 Neighborhoods for Investing in Airbnb Memphis Properties
The following Memphis neighborhoods are those where Airbnb investment properties are earning the highest cash on cash return on average:
#1. Raleigh
- Median Property Price: $134,654
- Average Airbnb Daily Rate: $224
- Monthly Airbnb Rental Income: $3,112
- Airbnb Occupancy Rate: 58%
#2. White Haven-Coro Lake
- Median Property Price: $97,743
- Average Airbnb Daily Rate: $161
- Monthly Airbnb Rental Income: $2,610
- Airbnb Occupancy Rate: 59%
#3. Midtown
- Median Property Price: $241,206
- Average Airbnb Daily Rate: $114
- Monthly Airbnb Rental Income: $2,501
- Airbnb Occupancy Rate: 59%
#4. River Oaks-Kirby-Balmoral
- Median Property Price: $427,267
- Average Airbnb Daily Rate: $158
- Monthly Airbnb Rental Income: $2,040
- Airbnb Occupancy Rate: 78%
#5. Berclair-Highland Heights
- Median Property Price: $139,068
- Average Airbnb Daily Rate: $81
- Monthly Airbnb Rental Income: $1,861
- Airbnb Occupancy Rate: 71%
Related: How to Find the Best Area for Airbnb Investment
3 More Reasons to Invest in Airbnb Memphis in 2021
The Airbnb data on the Memphis market is pretty convincing. But there are a few other reasons why an Airbnb investment in the city is a smart move for 2021:
#1. Non-Owner Occupied Airbnbs Are Legal in Memphis, TN
While other major cities in the Tennessee real estate market have very strict Airbnb regulations regarding non-owner occupied properties, Memphis hosts enjoy a bit more freedom. An Airbnb Memphis rental property does not need to be the host’s primary residence. A host can even operate more than one vacation rental in Memphis.
Of course, there are some short-term rental regulations in place. Airbnb Memphis hosts need permits, must abide by certain noise ordinances, and pay taxes. For more on the local Airbnb laws in Shelby County, click here.
It’s also important to note that Airbnb Memphis hosts may be subject to different regulations and safety guidelines during the pandemic. Be sure to talk to local officials and stay on top of any changes in COVID-19 restrictions during 2021.
#2. Millions of Tourists Visit Memphis Every Year
In 2019, the city was welcoming over 12.4 million visitors annually. It’s likely that the number of tourists who visited Memphis in 2020 dropped in comparison. However, with the COVID-19 vaccine rolling out across the country, real estate investors can begin to look to the future of tourism. The Memphis real estate market has always been a hot tourist destination and will likely continue to be one post-COVID-19.
With millions of visitors flooding the city every year, your Airbnb Memphis rental property is sure to enjoy a high occupancy rate. And you’re sure to reap the benefits.
#3. The Memphis Housing Market Is Booming, Despite COVID-19
Yes, you’re interested in purchasing an Airbnb investment in Memphis and the Home of the Blues seems to be one of the best cities for Airbnb. Still, you need to be aware of the health of the local housing market. Have prices dropped in Memphis? Will COVID-19 cause the Memphis housing market to crash in 2021? Such matters will affect your Memphis real estate investment, regardless of the rental strategy you plan to implement.
The most recent data from the Memphis Area Association of Realtors (MAAR) reveals that the housing market remained strong in 2020, despite the pandemic:
- Home sales were up year over year (YoY) by 0.4%
- The median sales price in Memphis was up YoY by 14.2%
- The monthly sales volume was up YoY by 12.8%
The 2021 MAAR President, Cassandra Bell-Warren, commented on these Memphis real estate market trends:
To have more total sales in 2020 than the previous year, amid a pandemic, is remarkable. Across the board—total sales, pricing, and sales volume—the numbers were up from 2019.
It would seem a Memphis housing market crash is nowhere in sight. Purchasing a Memphis investment property for sale would mean owning real estate in a healthy and growing market.
How to Find a Profitable Airbnb Rental Property in Memphis
Ready to start your search for an Airbnb Memphis, TN property? Turn to Mashvisor’s Rental Property Finder. With this real estate investment tool, you can easily find Memphis investment properties for sale that will generate a high Airbnb return.
Just by setting two filters (City: Memphis, TN and Rental Strategy: Airbnb), we quickly found these amazing Airbnb properties for you:
Visit Mashvisor today and conduct your investment property search quickly and confidently.
Related: Airbnb Properties for Sale: A Guide to Finding the Best One
A Few Final Words
Although the data shows that an Airbnb Memphis property will perform well, it’s important to keep the current situation with the coronavirus in mind. There may still come times in 2021 where you will have to close the doors of your short-term rental property to guests if local officials deem it necessary. For this, be sure to do the math with Mashvisor’s Airbnb profit calculator to determine how much cash you need to have saved up in times when your occupancy rate is low.
You will also hold a large responsibility for keeping your rental property safe and clean according to the CDC’s and Airbnb’s guidelines. Be sure to stay up to date on the latest safety regulations to ensure you and your guests remain healthy through this time.