Cleveland, Oklahoma

Cleveland, Oklahoma, is a small but growing city located within the Tulsa metropolitan area. While its population is relatively small, Cleveland serves as a gateway to various attractions, offering a unique blend of small-town charm and proximity to larger urban amenities. The short-term rental market in Cleveland has become increasingly appealing to investors and hosts, thanks in part to its scenic beauty, local attractions, and active outdoor recreation options nearby.

As of October 2023, the average daily rate (ADR) for short-term rentals in Cleveland is reported at $268.42. This figure points to a relatively high revenue potential when compared with the lower cost of real estate in the area. In this analysis, we will delve into several aspects of the short-term rental market to provide a holistic understanding of its potential for current and prospective investors.

Key performance indicators (KPIs) are essential for evaluating the health and performance of the short-term rental market. In Cleveland, several KPIs can assist investors in gauging potential profitability:

• Average Daily Rate (ADR): Currently at $268.42, this figure reflects the average price per night for short-term rentals, indicating potentially strong revenues.
• Occupancy Rates: Although specific figures for occupancy rates are not readily available, occupancy rates are typically lower in smaller cities compared to urban centers, hovering around 60-70% for many short-term rentals in similar markets.
• RevPAR (Revenue per Available Room): With the ADR and estimated occupancy rates, RevPAR can be approximated. For example, if occupancy is around 65%, RevPAR could be around $174.49.
• Length of Stay: Shorter stays are often prevalent in vacation rental markets. In Cleveland, expect lengths of stay to average 2-3 nights, attracting weekend travelers.

Understanding these KPIs is vital for forecasting cash flow and making informed investment decisions.

Cleveland has experienced gradual growth over the last decade. The short-term rental market reflects this trend, benefitting from its location within the greater Tulsa area, which has been more economically vibrant. According to data back to 2013, the average home price has incrementally increased, while visitor numbers in the region have also risen, particularly in summer and fall.

One significant factor contributing to this growth is the rise in domestic travel, which surged during the pandemic. Additionally, Cleveland’s growing appeal as a destination for water sports on Keystone Lake and its proximity to cultural hubs like Tulsa provide opportunities. Over the past 10 years, Cleveland's short-term rental market has also adapted to consumer preferences, often reflecting broader economic trends. Future growth could be supported by ongoing community development efforts, leading to more amenities and an improved local infrastructure.

When considering investment potential in Cleveland's short-term rental market, a few factors stand out:

1. Affordability: Real estate prices in Cleveland are generally lower compared to larger urban markets. This enables investors to acquire properties at competitive prices, potentially yielding higher returns.

2. Revenue Generation: With an ADR of $268.42, the revenue potential appears promising, especially with townspeople and visitors seeking accommodations.

3. Local Attractions: Proximity to Keystone Lake and surrounding parks enhances Cleveland's attractiveness as a vacation destination. Additionally, higher foot traffic can support business for short-term rentals.

While potential ROI is promising, investors should conduct thorough due diligence by analyzing local property taxes, maintenance costs, and management fees.

Cleveland's short-term rental market displays distinct seasonal patterns that potential investors need to understand. Typically, occupancy rates peak during the warmer months, particularly in the summer when visitors engage in Lake Keystone activities. The shoulder seasons of spring and fall also attract visitors for local events and foliage, but the winter season typically sees a dip in rentals as travelers opt for warmer climates.

Awareness of these seasonal patterns is crucial for pricing strategies and marketing efforts. Investors can plan for off-peak seasons by targeting specific marketing demographics, such as local business cohorts needing extended stays.

The performance of various property types in Cleveland's short-term rental market differs considerably.

• Single-Family Homes: These properties are often favored for families and larger groups, leading to higher occupancy rates and ADR. They possess the advantage of space and multiple amenities compared to smaller rentals.

• Condos and Townhomes: Smaller units can also perform well in the market, particularly for couples or solo travelers. However, they may have lower ADRs due to reduced space.

• Unique Stays: Properties with distinctive characteristics or themes can set themselves apart, often fetching higher rates and attracting special interest groups.

Understanding which type of property aligns with guest needs can ensure better property utilization and increased revenue.

Understanding guest preferences is crucial for optimizing your offerings. In Cleveland, guests typically seek the following amenities:

• Access to Outdoor Activities: Proximity to outdoor recreational activities like hiking, fishing, and boating is a draw for many guests.

• Pet-Friendly Options: Offering accommodations that allow pets can enhance appeal, particularly in small-town markets.

• Family-Oriented Amenities: Features such as multiple bedrooms, a full kitchen, and entertainment options can attract families looking for comfort.

• Local Culture: Properties that provide elements of local culture, such as decor or information on local attractions, can also enhance guest experiences.

Strategically incorporating these amenities can improve guest satisfaction and encourage higher occupancy rates.

The regulatory landscape for short-term rentals in Cleveland is currently less restrictive compared to larger urban areas. However, some necessary regulations do exist, such as:

• Zoning Requirements: Depending on the property location, investors must comply with specific zoning laws that may restrict short-term rentals in certain areas.

• Licensing: Some municipalities may require a rental license or registration to operate legally.

Staying informed about local regulations is essential for ensuring compliance and minimizing legal risks. Potential changes in local ordinances or regulations may pose risks down the line.

Cleveland’s town layout and demographics play a vital role in the short-term rental market. Key neighborhoods in the Cleveland area include areas close to the Keystone Lake, where demand typically spikes.

• Proximity to Amenities: Locations near key attractions such as parks, restaurants, and cultural venues perform better.

• Community Engagement: Neighborhoods exhibiting community events may have higher rental demand during those events.

Investing in high-demand neighborhoods can enhance investment viability, so prospective hosts should closely analyze neighborhood trends.

The outlook for Cleveland's short-term rental market appears cautiously optimistic. A growing trend toward remote work may sustain visitation as more travelers prefer flexible lodging options while balancing work-life demands. Furthermore, increasing domestic tourism continues to benefit the market.

Investors should pay attention to emerging trends, such as sustainability initiatives and unique travel experiences, as demand shifts. Adapting properties to reflect eco-friendly practices or cultivating unique stay packages can help secure market positioning.