The Benefits of Short-Term Rentals in Tourist Hotspots

🡐 Back to Resources | August, 2025 | Written by Kurt Russell

For investors, not all short-term rental (STR) markets are created equal. While suburban and business-travel markets offer stability, tourist hotspots consistently deliver some of the highest returns. Whether it’s a beach town, ski resort, or cultural capital, properties in high-demand destinations often enjoy stronger occupancy, premium nightly rates, and long-term appreciation.

This guide explores the key benefits of investing in STRs in tourist hotspots — and what to consider before diving in.

Why Tourist Hotspots Outperform

1. Year-Round Guest Demand
   Popular tourist destinations attract steady streams of visitors. This demand translates to fewer vacant nights and higher overall revenue compared to properties in less-traveled areas.

2. Premium Nightly Rates
   Guests expect to pay more in popular vacation destinations. Strong pricing power means higher average daily rates (ADR), especially during peak travel seasons.

3. Event-Driven Occupancy
   Tourist hotspots often host festivals, sports events, or seasonal celebrations. These events drive occupancy spikes and allow hosts to maximize profits with dynamic pricing.

Learn how to set competitive rates in our smart pricing guide.

Benefits for Investors

Stronger ROI Potential

With both high occupancy and strong nightly rates, STRs in tourist hotspots typically outperform long-term rentals and suburban STRs.

See more in our blog on maximizing profits in STRs.

Long-Term Appreciation

Property values in tourist markets often rise faster than average, driven by continued demand from travelers and investors alike.

Diversified Guest Niches

Tourist markets attract a wide range of guests: families, couples, solo travelers, and international visitors. This diversity reduces reliance on any single traveler type.

Curious about broader trends? Read our guide on the future of real estate: short-term rentals.

Challenges to Consider

While lucrative, investing in tourist hotspots comes with unique risks:

• Seasonality: Some destinations experience slow periods that require pricing and marketing strategies to fill gaps.

• Higher Competition: Popular areas often attract more investors, increasing competition for bookings.

• Regulations: Tourist-heavy cities may impose stricter STR rules to balance local housing needs.

For strategies to stand out, check our blog on boosting your Airbnb listing.

Maximizing Returns in Tourist Markets

To succeed in competitive tourist destinations, investors should:

• Stage and design properties to stand out visually

• Offer amenities that match traveler expectations (pools, hot tubs, beach gear, ski storage)

• Build partnerships with local restaurants, tour operators, or event organizers

• Use dynamic pricing tools to adjust nightly rates in real time

The Clear Stay Advantage

At Clear Stay Properties, we help investors unlock the full potential of tourist hotspot rentals by providing:

• Market research and ROI analysis to identify strong-performing areas

• Professional staging and essential STR amenities that impress guests

• Dynamic pricing and marketing strategies to capture peak demand

• Full-service management, from guest communication to maintenance and cleaning

By combining local knowledge with proven systems, we help investors profit even in highly competitive markets.

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The Takeaway

Tourist hotspots offer some of the strongest opportunities for STR investors, combining steady demand, premium rates, and long-term appreciation. With the right property, design, and pricing strategy, you can capture a share of these high-performing markets.

👉 Thinking about investing in a tourist destination? Fill out the form below to schedule your free consultation with Clear Stay Properties and let us guide you toward the best opportunities.