When you think of vacation rentals, you might not think of the Midwest. But according to a new survey from LawnStarter, two Midwest cities rank among the 10 best U.S. cities in which to own a vacation rental listed on sites such as Vrbo and Airbnb.
According to LawnStarter’s list, Milwaukee ranks as the third best U.S. city in which to own a vacation rental, while Indianapolis ranks seventh. Topping the list is Durham, North Carolina, followed by Birmingham, Alabama.
What put these citis at the top? They don’t come with some of the legal restrictions that other markets face. These restrictions limit the number of days visitors can rent a property, the number of guests that properties can hold and the type of property that can be used as a vacation rental.
These legal measures caused several of LawnStarter’s usual top-10 cities to drop, such as Miami, New York and Las Vegas.
Overall, LawnStarter compared more than 180 of the biggest cities in the United States based on six categories. The company considered legal restrictions on short-term rentals, occupancy rates and revenue potential. LawnStarter also looked at operating expenses such as housekeeping services and utilities to determine which cities provided the most consistent return on vacation rentals.
An interesting note: LawnStarter said that vacation rentals in Nashville, Tennessee, had the highest average daily rate, $260. But Nashville only ranked as the 68th best U.S. city in which to own a vacation rental because of the costly initial investment of setting up a rental here, legal limitations on vacation rentals and occupancy rates below 42%.