AirDNA Says 2026 Is the Best Year to Invest in STRs Since 2021. What StaySTRA Data Actually Shows.

Average daily rates across StaySTRA’s 47 tracked major markets hit $369 in February 2026, up 19.6% from $309 in February 2025. That is not a rounding error. That is the strongest year-over-year pricing gain since the post-pandemic travel boom of 2021.

Some industry reports have called 2026 the best year to invest in short-term rentals since 2021, pointing to cooling acquisition costs, steady revenue, and slowing new supply. The broad strokes of that thesis are not wrong. But when I pulled the actual numbers from our database this week, the picture turned out to be more interesting (and more complicated) than any single headline can capture.

I have spent 40 years working with data, first for the government and now tracking STR markets from my desk here in Santa Fe. One thing that experience teaches you: averages lie. What exists are specific markets doing specific things, and the investors who dig into those specifics are the ones who make better decisions. Let me walk you through what our data actually shows.

The ADR Story Is Real, and It Is Significant

Across 47 major STR markets that StaySTRA tracks with monthly data, average daily rates in February 2026 came in at $369. One year earlier, that number was $309. Two years earlier, $291.

Think of ADR like the sticker price on a car at a dealership. When sticker prices are rising and buyers are still paying them, it tells you something about demand. The fact that hosts were able to push nightly rates up nearly 20% in a single year, and travelers kept booking, is a meaningful signal about the health of short-term rental demand.

The gains were not evenly distributed, though. Mountain and cabin markets led the charge:

• Traverse City, MI: ADR up 42.3% ($184 to $262)
• Branson, MO: ADR up 36.0% ($168 to $228)
• Pigeon Forge, TN: ADR up 33.3% ($245 to $327)
• Nashville, TN: ADR up 29.3% ($259 to $335)
• Blue Ridge, GA: ADR up 27.2% ($284 to $361)

Coastal Florida markets also saw ADR increases, but the pattern was different. Sarasota pushed ADR up 21.7% ($310 to $377), and Kissimmee rose 33.2% ($231 to $308). But as we will see in a moment, those rate increases came with a trade-off.

The Occupancy Problem Nobody Wants to Talk About

Here is where the optimistic thesis gets complicated.

Average occupancy across those same 47 markets fell from 47.7% in February 2025 to 38.4% in February 2026. That is a 19.5% decline. Stay with me here, because this matters more than it might seem at first glance.

Occupancy is the volume knob on your revenue. You can raise your nightly rate all you want, but if your calendar has more empty nights, those rate increases do not fully reach your bank account. And that is exactly what happened across many markets in February 2026.

The markets with the steepest occupancy drops:

• Park City, UT: Occupancy fell from 60% to 39% (down 35.0%)
• Fort Pierce, FL: 66% to 44% (down 33.3%)
• Orange Beach, AL: 44% to 30% (down 31.8%)
• Bradenton, FL: 68% to 48% (down 29.4%)
• Corpus Christi, TX: 43% to 31% (down 27.9%)

Notice the pattern. Coastal markets and resort towns that saw massive supply expansion during 2022 and 2023 are now absorbing the consequences. Park City, for instance, grew from 3,757 active listings in February 2024 to 4,085 in February 2026. More inventory chasing the same number of ski-season visitors means emptier calendars.

The net effect on revenue? Across all 47 markets, average monthly revenue came in at $4,020 in February 2026, down 8.0% from $4,367 the previous year. The ADR gains were real, but they did not fully offset the occupancy losses at the market-wide level.

Where the Revenue Is Actually Growing

This is the part that matters most for investors evaluating new acquisitions. Not every market followed the same trajectory. Some posted strong revenue growth despite the broader occupancy headwinds.

StaySTRA’s top five markets by year-over-year revenue growth (February 2026 vs. February 2025):

1. Nashville, TN: Revenue up 26.0% ($2,787 to $3,512/month)
2. Pigeon Forge, TN: Revenue up 26.0% ($2,236 to $2,818/month)
3. Traverse City, MI: Revenue up 21.3% ($1,524 to $1,848/month)
4. Branson, MO: Revenue up 17.4% ($1,115 to $1,309/month)
5. Gatlinburg, TN: Revenue up 16.7% ($2,555 to $2,982/month)

Every single top-performing market is a mountain, cabin, or inland recreation destination. Not beach markets. Not urban centers. These are markets where visitors go for the experience of the property itself (hot tub on the deck, fireplace, mountain views) rather than for the location alone.

Two forces are working together. First, many of these markets went through a supply correction. Nashville shed 21.7% of its active listings, dropping from 7,652 to 5,988. Lower-performing operators exited, tightening supply and giving remaining operators more pricing power. Second, ADR growth in these markets has been aggressive, and travelers are paying it. Nashville’s ADR jumped 29.3% in a single year. When supply contracts and rates rise simultaneously, that is a market finding its footing.

The Supply Story Is the Most Misunderstood Part of the Thesis

The claim that new supply is “slowing” nationally is technically accurate. But the national average hides enormous divergence at the market level.

StaySTRA data shows markets splitting into two distinct groups:

Markets where supply is contracting (active listings declining year-over-year):

• Nashville, TN: down 21.7% (7,652 to 5,988 listings)
• Asheville, NC: down 19.9% (2,314 to 1,853)
• Saint Augustine, FL: down 17.9%
• Denver, CO: down 14.8% (4,415 to 3,760)
• Phoenix, AZ: down 13.2% (7,328 to 6,359)
• Austin, TX: down 11.9% (10,540 to 9,289)

Markets where supply is still expanding:

• Las Vegas, NV: up 39.8% (2,998 to 4,191 listings)
• Kissimmee, FL: up 15.2% (8,806 to 10,143)
• Orlando, FL: up 12.3% (3,922 to 4,403)
• Myrtle Beach, SC: up 10.0% (7,553 to 8,308)
• Pigeon Forge, TN: up 8.2% (3,048 to 3,297)

Markets that got oversaturated in 2022 and 2023 (Nashville, Austin, Phoenix, Denver) are now experiencing a natural correction. Operators who could not sustain profitability at lower occupancy rates exited. That correction is healthy for the remaining operators and for new investors evaluating those markets. But vacation corridor markets, particularly in Central Florida and along the Gulf Coast, are still adding inventory. Kissimmee alone added over 1,300 entire-place listings in a single year. For investors looking at those markets, the supply side requires closer scrutiny.

The Professional Operator Gap Is Widening

One of the most telling data points in StaySTRA’s database is the revenue distribution within individual markets. The gap between what top operators earn and what average or below-average operators earn has been widening for three consecutive years.

Take Nashville as an example. In February 2026:

• Bottom 25% of operators: $1,527/month
• Median operator: $2,746/month
• Top 25%: $4,532/month
• Top 10%: $7,087/month

The top 10% earned 4.6 times what the bottom 25% earned. In the same city, in the same month, listing on the same platforms.

Gatlinburg shows the same pattern. Top 10% at $6,096 per month, bottom 25% at $1,167. That is a 5.2x spread.

Don’t let those numbers scare you. What they reveal is that the market rewards professional-grade operations: better photos, optimized pricing, responsive communication, superior guest experience. The operators at the top are not lucky. They are running their listings like businesses. For investors entering the market in 2026, this is encouraging. The “ceiling” in most markets is far higher than the “average” suggests, and the gap between professional and passive operators keeps widening.

What the Data Says About the STR Premium Over Long-Term Rentals

One of the core investment arguments for short-term rentals is that they generate higher gross yields than traditional long-term rentals. Let me check that assumption against current StaySTRA data for a few representative markets.

Nashville has a typical home value of $429,861 according to StaySTRA’s housing data. The average STR operator there earns roughly $4,660 per month on a trailing annual basis, which works out to about $55,920 per year. That is a 13.0% gross yield on the asset value. A comparable long-term rental in Nashville would generate approximately $2,100 to $2,400 per month, putting the LTR gross yield at roughly 5.9% to 6.7%. The STR premium: approximately 2x the long-term rental return.

Orlando tells a similar story. Typical home value of $370,827, with STR monthly revenue averaging $3,394 in February (a shoulder month). Even at that conservative figure, the annualized gross yield outpaces typical Orlando long-term rental yields of 5% to 6%.

Here is the honest caveat I would give anyone running these numbers: STR returns come with higher operating costs (cleaning, supplies, management software, higher turnover), more volatility (seasonal swings, regulatory risk), and they require active management or a property manager who typically takes 20% to 30% of revenue. The net yield after expenses is closer to the LTR yield than the gross numbers suggest. The premium is real, but it is not as wide as the top-line comparison implies.

So Is 2026 Actually a Good Year to Invest?

After pulling all of these numbers, here is what I can tell you with confidence based on the data.

What the data supports: ADR growth of nearly 20% across major markets is a strong demand signal. Supply contraction in previously oversaturated cities (Nashville, Austin, Phoenix, Denver, Asheville) is creating better conditions for remaining operators. Mountain and cabin markets are posting double-digit revenue growth. Acquisition costs have stabilized or declined slightly in many markets, improving the entry math.

What the data complicates: Occupancy is down significantly across the board, and the ADR gains are not fully compensating at the revenue level. Markets still adding supply (Central Florida, Gulf Coast, Las Vegas) face continued pressure. The gap between professional and amateur operators means “average” market returns will not apply to everyone equally.

The honest answer is that 2026 is a better year to invest in specific markets with strong fundamentals than it is to invest in “STRs” as a generic asset class. Run your numbers on the specific market you are considering. The difference between a Nashville (revenue up 26%, supply down 22%) and a Park City (occupancy down 35%, revenue down 31%) is the difference between a sound investment and a cautionary tale.

How Investors Are Financing STR Acquisitions in 2026

For investors who are seeing strong fundamentals in their target markets, the financing side of the equation has also shifted in their favor. DSCR (debt service coverage ratio) loans, which underwrite based on the property’s rental income rather than the borrower’s personal income, have become the go-to acquisition tool for STR investors. Lenders are increasingly comfortable with short-term rental revenue projections, particularly in markets with established track records and verifiable data.

We are publishing a detailed STR financing guide later this week that walks through DSCR loan mechanics, current rates, and which lenders are actually closing STR deals in 2026. If the revenue data in your target market looks strong, understanding the financing options is the next step in the evaluation.

We do our best to keep our data accurate and up to date, but markets move fast and we are only human. Always verify current figures directly with local sources before making investment decisions.

Run the Numbers for Your Target Market

If you are evaluating a specific market for STR investment, run your numbers through StaySTRA’s analyzer tool. It pulls from the same database I used for this analysis and gives you market-specific revenue projections, occupancy rates, and ADR data rather than national averages. Plug in the city, property type, and bedroom count you are considering.