Hill City, South Dakota Short-Term Rental Market
Hill City bans new residential STRs; September 2026 Black Hills ADR was $239, occupancy 62.4%, revenue $4,129.
Quick Answer: Hill City, South Dakota is an active short-term rental market. average occupancy in the Rapid City market area is 62%. average monthly revenue in the Rapid City market area is $4,129. average daily rate in the Rapid City market area is $239. the top operator in the Rapid City market area is Evolve with 72 listings. market score is 50/100 (grade D).
Market data reflects the Rapid City regional market, which includes Hill City. Regulations, taxes, and permit details below are specific to Hill City.
Market Score Breakdown
Five dimensions StaySTRA evaluates per market.
Market Overview
Hill City sits in the Black Hills, and its short-term rental performance is reported at a shared regional level, so the figures below describe the Black Hills STR market, which also includes Custer and Sturgis. The most important fact for investors is regulatory: a June 2022 ballot initiative banned new short-term rentals in residentially zoned areas of Hill City, so market entry is limited. In September 2026, the Black Hills STR market averaged an ADR of $239 with 62.4% occupancy and average monthly revenue of $4,129 per listing. Occupancy rose 8.4% year over year, ADR rose 2.7%, and revenue rose 10.3%, which points to growth driven mostly by more booked nights rather than price alone. Annual revenue, summed across the seasonal months, comes to $33,688 per listing. Entire homes averaged $245 ADR in September 2026, and the typical entire-place listing earned $4,298 per month, compared with $4,474 for houses and $3,310 for apartments. Luxury listings reached $335 ADR and professionally managed listings reached $267. Hill City itself has a population of 953 and works as a basecamp for visitors to Mount Rushmore, Crazy Horse Memorial, Custer State Park, Jewel Cave and the 109-mile Mickelson Trail. Demand is strongly seasonal, with a summer peak and a surge around the Sturgis Motorcycle Rally in August. Bedroom, channel, and listing-type counts and top operators are tracked at a shared regional level rather than uniquely for Hill City, so this profile omits them. Investors should treat these numbers as a regional benchmark for properties that already hold or can obtain legal STR status, not as a forecast for any one address.
Seasonal Patterns
| Month | Occupancy |
|---|---|
| Jan | 38% |
| Feb | 47% |
| Mar | 56% |
| Apr | 47% |
| May | 61% |
| Jun | 75% |
| Jul | 75% |
| Aug | 63% |
| Sep | 59% |
| Oct | 49% |
| Nov | 40% |
| Dec | 45% |
Month-by-month nightly rates and revenue figures for Hill City are available to StaySTRA Pro members. Unlock with StaySTRA Pro or analyze a specific address free.
Top Short-Term Rental Operators in Rapid City market area
Ranked by total active listings. Useful for understanding the competitive landscape. Operator data is published for the Rapid City market as a whole, which includes Hill City, so these counts are not Hill City-only figures.
| # | Operator | Listings | Reviews | Rating |
|---|---|---|---|---|
| 1 | Evolve | 72 | 5,007 | ★ 4.78 |
| 2 | Stay in the Black Hills | 60 | 4,548 | ★ 4.82 |
| 3 | Soujourn | 40 | 6,573 | ★ 4.67 |
| 4 | Velora Management Group | 28 | 812 | ★ 4.58 |
| 5 | Bear Property Management | 27 | 1,648 | ★ 4.86 |
What Kind of STR Should I Buy in Hill City?
Revenue and nightly-rate breakdowns by bedroom count, property tier, and dwelling type for Hill City are available to StaySTRA Pro members. Unlock with StaySTRA Pro or analyze a specific address free.
Booking Channel Mix
Distribution of bookings across major STR platforms.
| Channel | Share |
|---|---|
| airbnb | 42.3% |
| vrbo | 13.6% |
| both | 44.1% |
Home Value Trends (Hill City)
Typical home values, median sale prices, and the 10-year price trend for Hill City are available to StaySTRA Pro members. Unlock with StaySTRA Pro or analyze a specific address free.
Booking Insights
Booking-window and length-of-stay analysis for Hill City — how far ahead guests book and how to price around it — is available to StaySTRA Pro members. Unlock with StaySTRA Pro or analyze a specific address free.
Short-Term Rental Regulations
Short-term rentals are permitted in Hill City, but the rules sharply limit new entrants. A June 2022 citizen ballot initiative banned new short-term rentals in all residentially zoned areas. This replaced an earlier city council ordinance that capped STRs at 8% of properties per residential street. Existing rentals that operated before the ban are grandfathered, but that status is lost when the property is sold or ownership changes, so it does not transfer to a new buyer. Exemptions apply to owner-occupied homes where the owner lives in part of the dwelling, bed-and-breakfast operations, and rentals leased for more than 28 days. Under South Dakota state law, any property may also operate as a short-term rental during the annual Sturgis Motorcycle Rally. STRs generally remain allowed in commercially zoned areas. Operators need a short-term rental authorization under the city ordinance and a state sales-tax license. A permit cost and renewal period are not published in the data reviewed here. The combined lodging tax is about 8.7%, covering the 4.2% state sales tax, the 2% Hill City municipal sales tax, a 1% municipal gross-receipts tax on lodging, and the 1.5% state tourism tax. No owner-occupancy or primary-residence requirement applies to every rental, and no statewide cap on nights applies. Enforcement is rated moderate. Regional reporting through 2024 described Black Hills STR regulation as still evolving, and no newer Hill City ordinance change was found. Confirm current rules with the city before you buy.
Market Comparison
The Black Hills STR market performed well in September 2026, with 62.4% occupancy and a $239 ADR. Luxury listings at $335 and professionally managed listings at $267 sit well above the all-listings ADR. Growth also looks healthy, with occupancy up 8.4%, ADR up 2.7%, and revenue up 10.3% year over year. The comparison has limits. The Black Hills market is strongly seasonal, with January occupancy at 37.7% against 75.1% in July, so the annual picture is less impressive than a peak month suggests. Occupancy for the first nine months of 2026 is 57.9%, lower than September alone implies. Supply is also constrained by regulation: new residential STRs are barred in Hill City, which limits competition for existing operators but also limits new investor entry. Top operators are tracked at a shared regional level rather than uniquely for Hill City, so this profile omits them. For investors, the draw is a destination with steady leisure demand and a strong summer, paired with a regulatory barrier that makes legal access the first thing to verify.
Frequently Asked Questions About Hill City, South Dakota
Can I start a new short-term rental in Hill City, South Dakota?
What happens to a grandfathered Hill City STR when it is sold?
What is the average daily rate in the Black Hills STR market?
What is the occupancy rate for Hill City area rentals?
How much do rentals earn per month in the Black Hills?
What lodging taxes apply to Hill City short-term rentals?
How far ahead do guests book in the Black Hills?
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