The 10 Best College Markets for Short-Term Rentals

With August winding down, two certain things are happening: Football pads are starting to crash together, and college town short-term rental hosts are filling their rentals. Investors have thrived in college towns for years as long-term markets, but where can you find an STR that shows you the money signs? (Yes, a Johnny Manziel reference in 2024.)

Short-term rental may only sometimes be the best strategy for your property in a college town. Regulations, mid- and long-term rentals, construction costs, and more will strongly influence how you handle your investment. 

When asked about making these decisions, REINation said:

“In Tuscaloosa and Birmingham, short-term rental construction costs can run 25-35% more than if we were holding for long-term rental. Short-term rentals will earn 20-30% more per night when occupied, but the downside is the loss of income on vacant nights. Now, when those seven to nine weekends a year roll around when football games are being hosted, or on the graduation weekends and other similar big event weekends, per-night rental rates can be up to 100% higher.”

I love the idea of extreme cash flow, especially when my team wins (if I buy a property there, I will be rooting for them after, guaranteed), so let’s get our STR game plan together. I will use a series of data from BiggerPockets Market Finder and AirDNA. Let me know if someone has a direct line to Lee Corso so we can have him put the winning mascot head-on.

Criteria:

• Amount of revenue potential.
• Growth of the city over time.
• Occupancy rates (during football season and off-season).
• Average home price and appreciation rate.
• Is the team relevant? (sorry, Durham, NC).

I divided these categories into two sections: revenue and area growth. I ranked each city by category and crowned a winner based on their positions.

Revenue 

Using occupancy numbers and average daily rates (ADR) for each city, we can determine the estimated revenue for an entire year in the market. These blanket averages will go up or down depending on what size or type of property you research. The Market Finder allows me to see the median home price for the area. 

I calculated the median annual mortgage payment (principal and interest only) based on a 7.5% interest rate with 20% down to see which place has the highest potential revenue. This does not include taxes and insurance. Working with a trusted, investor-friendly real estate agent and lender will give you even more insight into the numbers when you have narrowed your choices. 

The last metrics we take into consideration are the monthly demand change and ADR percentage change during the football season versus the off-season. We consider the off-season January through July, with the season taking place August through November. Typically, the U.S. has seen, on average, 11.5% lower monthly demand and 6.4% lower ADR during the football season. 

Area Growth

The Market Finder lets you see yearly appreciation rates, median long-term rental income, and population growth rates in one place. These numbers will help you clarify what could be a viable investment for years to come, no matter your end strategy. There is beauty in the art of blending appreciation and cash flow into short-term rentals. 

Tiebreaker

My tiebreaker for any market is simple: Who had the better team during the 2000s? This may not be a typical metric for investments, but I’m sure the better the team, the more people will travel to the games.

The Top 10 

My list of honorable mentions came extremely close to making the list but fumbled at the goal line compared to other markets. However, these may be your alma mater, which would add a new desire to consider investing there.

• Boise, Idaho
• Corvallis, Oregon
• Tucson, Arizona
• Provo, Utah
• Eugene, Oregon
• Knoxville, Tennessee

Now, the committee is ready to reveal the participants. 

10. Pullman, Washington (Washington State University)

• Occupancy Rate: 52% 
• ADR: $279 
• Median Home Price: $406,000
• Potential Revenue After P&I: $25,740
• Monthly Demand Change During Season: 53.9%
• Average Daily Rate Change During Season: 11%
• Appreciation Rate: 1.08%
• Population Growth: 1.38%
• Median Long-Term Rental: $1,511

This may be one of my favorite markets based on potential cash flow. Their actual football record, appreciation rate, and revenue growth puts them barely cracking our top 10, though. That would at least be one top-10 finish for the Cougars, finally. 

9. Iowa City, Iowa (University of Iowa)

• Occupancy Rate: 48% 
• ADR: $227
• Median Home Price: $279,000
• Potential Revenue After P&I: $21,050.4
• Monthly Demand Change During Season: 26.3%
• Average Daily Rate Change During Season: 37.5%
• Appreciation Rate: 4.02%
• Population Growth: 0.88%
• Median Long-Term Rental: $1,187

One of the quicker-growing markets on our list, the Hawkeyes have above-average metrics in almost every field. That is also their downside, as they sit in the middle of the pack in almost every field. I hope their occupancy rate and passing rates (no more second down halfback plunges, please) both see higher numbers in the future.

8. Ann Arbor, Michigan (University of Michigan)

• Occupancy Rate: 53% 
• ADR: $303.6
• Median Home Price: $394,000
• Potential Revenue After P&I: $32,295.42
• Monthly Demand Change During Season: 42.6%
• Average Daily Rate Change During Season: 34.4%
• Appreciation Rate: 4.56%
• Population Growth: 0.59%
• Median Long-Term Rental: $1,839

Michigan finally returned to glory as the 2023 National Champions while jumping up on our list. A healthy appreciation rate mixed with great STR metrics put the Wolverines in our top 10. However, Harbaugh has left, and so have guests, as revenue may be trending down.

7. Auburn, Alabama (Auburn University)

• Occupancy Rate: 40.1% 
• ADR: $314
• Median Home Price: $308,000
• Potential Revenue After P&I: $25,294
• Monthly Demand Change During Season: 46.6%
• Average Daily Rate Change During Season: 59.5%
• Appreciation Rate: 5.3%
• Population Growth: 1.69%
• Median Long-Term Rental: $1,450

Cam Newton may be a thing of the past, but Auburn is still a powerhouse. The appreciation rate and potential revenue are surprisingly high. The occupancy rate, regulations, and seasonality have a chance to never let them return to the STR peak.

6. Columbia, South Carolina (South Carolina University)

• Occupancy Rate: 51.6% 
• ADR: $179
• Median Home Price: $246,000
• Potential Revenue After P&I: $17,313.5
• Monthly Demand Change During Season: 30.5%
• Average Daily Rate Change During Season: 15.8%
• Appreciation Rate: 4.42%
• Population Growth: 0.74%
• Median Long-Term Rental: $1,494

I have a friend who went to South Carolina University, and almost 10 years later, he still travels back for every home game from Houston. He hasn’t seen them win anything yet (sorry, Roy), but with great occupancy and appreciation rates, their glory days may be coming. I hope the ADR can grow as much as my friend has racked up airline miles. 

5. Waco, Texas (Baylor University)

• Occupancy Rate: 50.8% 
• ADR: - $242
• Median Home Price: $253,000
• Potential Revenue After P&I: $27,891
• Monthly Demand Change During Season: 6.7%
• Average Daily Rate Change During Season: 8.2%
• Appreciation Rate: 1.11%
• Population Growth: 1.09%
• Median Long-Term Rental: $1,449

The Bears may not have any national titles, but they do have one thing going for them: impressive potential revenue. Although their appreciation rate has been concerning over time, being in between some of the biggest feeder cities in the U.S. (Houston, Austin, and Dallas) will help bring in guests for years to come. 

4. Madison, Wisconsin (University of Wisconsin)

• Occupancy Rate: 66.4% 
• ADR: $257.42
• Median Home Price: $399,000 
• Potential Revenue After P&I: $35,522
• Monthly Demand Change During Season: 29%
• Average Daily Rate Change During Season: 15.5%
• Appreciation Rate: 6.32%
• Population Growth: 0.67%
• Median Long-Term Rental: $1,589

The Badgers may not have the college football prestige as some others, but they make up for it with the highest potential revenue on this list. However, seasonality and one of the higher median home price averages may keep investors on the sidelines in Madison.

3. Athens, Georgia (University of Georgia)

• Occupancy Rate: 44% 
• ADR: $285
• Median Home Price: $342,000
• Potential Revenue After P&I: $22,815
• Monthly Demand Change During Season: 40%
• Average Daily Rate Change During Season: 41.9%
• Appreciation Rate: 7.24%
• Population Growth: 1.08%
• Median Long-Term Rental: $1,796

Home of the 2X National Champion Bulldogs, Athens is no stranger to winning. Boasting an impressive appreciation rate with strong revenue potential, Athens has earned its spot as a champion of the list. Rental demand and a high supply of STR listings put Georgia a few spots from the top.

2. Columbus, Ohio (Ohio State University)

• Occupancy Rate: 52.5% 
• ADR: $192
• Median Home Price: $310,000
• Potential Revenue After P&I: $15,962
• Monthly Demand Change During Season: 20.1%
• Average Daily Rate Change During Season: 12.6%
• Appreciation Rate: 6.48%
• Population Growth: 0.69%
• Median Long-Term Rental: $1,491

The Buckeyes are no stranger to successful campaigns and prove it again. They have one of the highest revenue growth numbers on AirDNA.com and an impressive appreciation rate. ADR is average for now, but this could positively change as quickly as Urban Meyer was out in Jacksonville.

1. Tuscaloosa, Alabama (University of Alabama)

• Occupancy Rate: 33% 
• ADR: $441
• Median Home Price: $214,000
• Potential Revenue After P&I: $25,294
• Monthly Demand Change During Season: 99.4%
• Average Daily Rate Change During Season: 44.6%
• Appreciation Rate: 1.04%
• Population Growth: 2.66%
• Median Long-Term Rental: $1,549

If this list were pure football dominance, the 6x National Champion Rolling Tide would run away with this competition. A high ADR mixed with the lowest median home price on the list put Tuscaloosa in the top spot once again. Occupancy and regulation are as much of a concern as when Saban retired, though.  

Final Thoughts

I was hoping we could get away from the reign of powerhouses, but it seems the SEC and Big 10 are winning all around, even in STR metrics. Your end goals matter greatly when deciding if a college football-based STR is right for you: Investing in a market where you actively want to go to the games may not be your best move, as you will occupy your unit on the highest-revenue weekends. 

If you want future financial freedom, I would sit back with ESPN+ to watch your favorite team and bank account in action. Don’t forget to invite me to the tailgate; I’ll bring the coffee.

Note By BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.