Best Markets for Rental Arbitrage 2026: Top 15 Cities Ranked

Last Updated: January 22, 2026

Author: Shaun Ghavami, Co-Founder at 10XBNB

Reading Time: 15 minutes

Quick Answer: Top Markets for Rental Arbitrage 2026

Top 5 markets for rental arbitrage in 2026:

1. Nashville, TN – ADR $210, 65% occupancy, hybrid market, $1,200-$1,800/month profit
2. Phoenix, AZ – ADR $180, 60% occupancy, hybrid market, $800-$1,200/month profit
3. Savannah, GA – ADR $291, 58% occupancy, tourism market, $1,400-$2,000/month profit
4. Austin, TX – ADR $195, 68% occupancy, hybrid market, $1,000-$1,500/month profit
5. Denver, CO – ADR $185, 62% occupancy, hybrid market, $900-$1,300/month profit

Key insight: Hybrid markets (supporting both STR and medium-term rentals) offer 40% higher average profits and 85% occupancy versus 62% in STR-only markets, according to 10XBNB’s 2026 Student Success Survey.

This market guide is part of our complete rental arbitrage guide. For related topics, see our rental arbitrage calculator and legal guide by state.

Introduction

Market selection is the most critical decision in rental arbitrage. Choosing the right market determines your profitability, occupancy, and long-term success. The best markets combine strong demand, favorable regulations, and hybrid market support (both short-term and medium-term rentals).

This comprehensive 2026 market guide ranks the top 15 cities for rental arbitrage based on proprietary data from 1,247 successful 10XBNB students, current market analysis, and regulatory research. You’ll learn exactly which markets offer the best opportunities, what makes them strong, and how to evaluate markets for yourself.

Key takeaway: According to 10XBNB’s 2026 Student Success Survey, operators in hybrid markets generate 40% higher average profits ($2,940/month vs. $2,100/month) and achieve 85% average occupancy versus 62% in STR-only markets.

Top 15 Markets for Rental Arbitrage 2026 (Ranked)

1. Nashville, TN

Market Ranking: #1
Market Type: Hybrid (STR + Medium-Term Rentals)
Overall Score: 9.2/10

Key Metrics:

• ADR: $210
• Occupancy: 65% (87% in hybrid mode)
• Average Monthly Revenue: $4,095
• Average Monthly Profit: $1,200-$1,800
• Startup Costs: $8,000-$12,000
• ROI: 120-180%

Market Drivers:

• Music tourism (Nashville is the “Music City”)
• Business travel (corporate headquarters)
• Healthcare industry (Vanderbilt University Medical Center)
• Events and conventions
• Growing tech sector

Regulatory Environment:

• STR-friendly regulations
• Permits required but accessible
• No major restrictions
• Landlord approval rates: 34% (with 10XBNB pitch script)

Why It’s #1:

• Strong hybrid market support (STR + MTR)
• Consistent year-round demand
• High ADR with good occupancy
• Favorable regulatory environment
• Strong landlord approval rates

Best For:

• Operators seeking high profitability
• Those comfortable with tourism-driven demand
• Operators who can handle event-driven spikes

Student Success Data:

• 76% profitable within 90 days
• Average time to profitability: 64 days
• Top-quartile operators: $2,400/month profit

2. Phoenix, AZ

Market Ranking: #2
Market Type: Hybrid (STR + Medium-Term Rentals)
Overall Score: 8.9/10

Key Metrics:

• ADR: $180
• Occupancy: 60% (82% in hybrid mode)
• Average Monthly Revenue: $3,240
• Average Monthly Profit: $800-$1,200
• Startup Costs: $7,500-$11,000
• ROI: 80-120%

Market Drivers:

• Winter tourism (snowbirds)
• Business travel
• Healthcare industry
• Spring training (MLB)
• Growing population

Regulatory Environment:

• STR-friendly regulations
• Permits required
• Moderate restrictions
• Landlord approval rates: 32%

Why It’s #2:

• Strong hybrid market support
• Consistent winter demand
• Lower ADR but good occupancy
• Growing market
• Favorable regulations

Best For:

• Operators seeking steady income
• Those targeting winter tourism
• Operators comfortable with seasonal variations

Student Success Data:

• 73% profitable within 90 days
• Average time to profitability: 67 days
• Top-quartile operators: $1,800/month profit

3. Savannah, GA

Market Ranking: #3
Market Type: Tourism-Focused (STR-Only)
Overall Score: 8.7/10

Key Metrics:

• ADR: $291
• Occupancy: 58%
• Average Monthly Revenue: $5,063
• Average Monthly Profit: $1,400-$2,000
• Startup Costs: $9,000-$13,000
• ROI: 140-200%

Market Drivers:

• Historic tourism
• Events and conventions
• Wedding destination
• St. Patrick’s Day festival
• Riverfront tourism

Regulatory Environment:

• Moderate regulations
• Permits required
• Some restrictions
• Landlord approval rates: 28%

Why It’s #3:

• Highest ADR in top 15
• Strong tourism demand
• Event-driven spikes
• High profit potential
• Unique market positioning

Best For:

• Operators seeking high ADR
• Those comfortable with tourism-driven demand
• Operators who can capitalize on events

Student Success Data:

• 71% profitable within 90 days
• Average time to profitability: 69 days
• Top-quartile operators: $2,200/month profit

4. Austin, TX

Market Ranking: #4
Market Type: Hybrid (STR + Medium-Term Rentals)
Overall Score: 8.6/10

Key Metrics:

• ADR: $195
• Occupancy: 68% (highest in top 15)
• Average Monthly Revenue: $3,978
• Average Monthly Profit: $1,000-$1,500
• Startup Costs: $8,500-$12,000
• ROI: 100-150%

Market Drivers:

• Tech industry (Silicon Hills)
• Music festivals (SXSW, ACL)
• University of Texas
• Business travel
• Growing population

Regulatory Environment:

• STR-friendly regulations
• Permits required
• Some neighborhood restrictions
• Landlord approval rates: 30%

Why It’s #4:

• Highest occupancy in top 15
• Strong hybrid market support
• Tech-driven demand
• Event-driven spikes
• Growing market

Best For:

• Operators seeking high occupancy
• Those targeting tech/business travelers
• Operators who can handle event-driven demand

Student Success Data:

• 74% profitable within 90 days
• Average time to profitability: 66 days
• Top-quartile operators: $2,000/month profit

5. Denver, CO

Market Ranking: #5
Market Type: Hybrid (STR + Medium-Term Rentals)
Overall Score: 8.4/10

Key Metrics:

• ADR: $185
• Occupancy: 62%
• Average Monthly Revenue: $3,441
• Average Monthly Profit: $900-$1,300
• Startup Costs: $8,000-$12,000
• ROI: 90-130%

Market Drivers:

• Outdoor recreation
• Business travel
• Healthcare industry
• Ski season tourism
• Growing tech sector

Regulatory Environment:

• Moderate regulations
• Permits required
• Some restrictions
• Landlord approval rates: 29%

Why It’s #5:

• Strong hybrid market support
• Year-round demand
• Outdoor recreation appeal
• Growing market
• Moderate regulations

Best For:

• Operators seeking steady income
• Those targeting outdoor recreation travelers
• Operators comfortable with seasonal variations

Student Success Data:

• 72% profitable within 90 days
• Average time to profitability: 68 days
• Top-quartile operators: $1,700/month profit

6. Atlanta, GA

Market Ranking: #6
Market Type: Corporate Travel
Overall Score: 8.2/10

Key Metrics:

• ADR: $165
• Occupancy: 64%
• Average Monthly Revenue: $3,168
• Average Monthly Profit: $800-$1,200
• Startup Costs: $7,000-$10,000
• ROI: 80-120%

Market Drivers:

• Business travel
• Conventions
• Healthcare industry
• Hartsfield-Jackson Airport (world’s busiest)
• Growing population

Regulatory Environment:

• STR-friendly regulations
• Permits required
• Some restrictions
• Landlord approval rates: 31%

Why It’s #6:

• Strong corporate travel demand
• Consistent year-round demand
• Lower ADR but good occupancy
• Major airport hub
• Favorable regulations

Best For:

• Operators seeking steady income
• Those targeting business travelers
• Operators who want consistent demand

Student Success Data:

• 70% profitable within 90 days
• Average time to profitability: 70 days
• Top-quartile operators: $1,500/month profit

7. Charlotte, NC

Market Ranking: #7
Market Type: Hybrid (STR + Medium-Term Rentals)
Overall Score: 8.1/10

Key Metrics:

• ADR: $170
• Occupancy: 61%
• Average Monthly Revenue: $3,111
• Average Monthly Profit: $850-$1,250
• Startup Costs: $7,500-$11,000
• ROI: 85-125%

Market Drivers:

• Banking industry
• Business travel
• Healthcare industry
• NASCAR events
• Growing population

Regulatory Environment:

• STR-friendly regulations
• Permits required
• Moderate restrictions
• Landlord approval rates: 30%

Why It’s #7:

• Strong hybrid market support
• Banking-driven demand
• Consistent year-round demand
• Growing market
• Favorable regulations

Best For:

• Operators seeking steady income
• Those targeting business travelers
• Operators who want consistent demand

Student Success Data:

• 71% profitable within 90 days
• Average time to profitability: 69 days
• Top-quartile operators: $1,600/month profit

8. Raleigh, NC

Market Ranking: #8
Market Type: University/Healthcare
Overall Score: 8.0/10

Key Metrics:

• ADR: $175
• Occupancy: 59%
• Average Monthly Revenue: $3,098
• Average Monthly Profit: $900-$1,300
• Startup Costs: $8,000-$12,000
• ROI: 90-130%

Market Drivers:

• Research Triangle (RTP)
• Universities (NC State, Duke, UNC)
• Healthcare industry
• Tech sector
• Business travel

Regulatory Environment:

• STR-friendly regulations
• Permits required
• Some restrictions
• Landlord approval rates: 28%

Why It’s #8:

• University and healthcare demand
• Research Triangle appeal
• Consistent year-round demand
• Growing tech sector
• Moderate regulations

Best For:

• Operators seeking steady income
• Those targeting university/healthcare travelers
• Operators who want consistent demand

Student Success Data:

• 70% profitable within 90 days
• Average time to profitability: 70 days
• Top-quartile operators: $1,500/month profit

9. Jacksonville, FL

Market Ranking: #9
Market Type: Tourism
Overall Score: 7.9/10

Key Metrics:

• ADR: $160
• Occupancy: 63%
• Average Monthly Revenue: $3,024
• Average Monthly Profit: $750-$1,100
• Startup Costs: $7,000-$10,000
• ROI: 75-115%

Market Drivers:

• Beaches
• Business travel
• Military presence
• Tourism
• Growing population

Regulatory Environment:

• STR-friendly regulations
• Permits required
• Some restrictions
• Landlord approval rates: 27%

Why It’s #9:

• Beach tourism appeal
• Consistent year-round demand
• Lower ADR but good occupancy
• Growing market
• Favorable regulations

Best For:

• Operators seeking steady income
• Those targeting beach tourism
• Operators who want consistent demand

Student Success Data:

• 69% profitable within 90 days
• Average time to profitability: 71 days
• Top-quartile operators: $1,400/month profit

10. Columbus, OH

Market Ranking: #10
Market Type: University/Healthcare
Overall Score: 7.8/10

Key Metrics:

• ADR: $155
• Occupancy: 60%
• Average Monthly Revenue: $2,790
• Average Monthly Profit: $700-$1,000
• Startup Costs: $6,500-$9,500
• ROI: 70-110%

Market Drivers:

• Ohio State University
• Healthcare industry
• Business travel
• Events
• Growing population

Regulatory Environment:

• STR-friendly regulations
• Permits required
• Some restrictions
• Landlord approval rates: 26%

Why It’s #10:

• University-driven demand
• Consistent year-round demand
• Lower ADR but good occupancy
• Affordable startup costs
• Favorable regulations

Best For:

• Operators seeking lower startup costs
• Those targeting university travelers
• Operators who want consistent demand

Student Success Data:

• 68% profitable within 90 days
• Average time to profitability: 72 days
• Top-quartile operators: $1,300/month profit

Markets 11-15: Quick Overview

11. Tampa, FL

• ADR: $165, Occupancy: 61%
• Market Type: Tourism/Corporate
• Monthly Profit: $800-$1,200
• Score: 7.7/10

12. Dallas, TX

• ADR: $175, Occupancy: 59%
• Market Type: Corporate
• Monthly Profit: $850-$1,250
• Score: 7.6/10

13. San Antonio, TX

• ADR: $170, Occupancy: 60%
• Market Type: Tourism/Corporate
• Monthly Profit: $800-$1,200
• Score: 7.5/10

14. Orlando, FL

• ADR: $180, Occupancy: 58%
• Market Type: Tourism
• Monthly Profit: $900-$1,300
• Score: 7.4/10

15. Las Vegas, NV

• ADR: $195, Occupancy: 55%
• Market Type: Tourism
• Monthly Profit: $1,000-$1,500
• Score: 7.3/10

Market Selection Criteria

1. Demand Indicators

Tourism Volume:

• Annual visitor numbers
• Peak season demand
• Event-driven spikes
• Year-round consistency

Business Travel:

• Corporate headquarters
• Convention centers
• Airport traffic
• Business district activity

University/Healthcare:

• University enrollment
• Medical centers
• Research institutions
• Student/faculty travel

Key Metrics to Evaluate:

• Average daily rate (ADR) trends
• Occupancy rate stability
• Revenue per available room (RevPAR)
• Market growth trends

2. Regulatory Environment

STR-Friendly Markets:

• Permits available and accessible
• No major restrictions
• Clear regulations
• Landlord approval rates: 30%+

Moderate Regulations:

• Permits required
• Some restrictions
• Compliance costs
• Landlord approval rates: 25-30%

Strict Regulations:

• Limited permits
• Heavy restrictions
• High compliance costs
• Landlord approval rates: <25%

How to Evaluate:

• Check city government websites
• Review STR ordinances
• Consult local attorneys
• Talk to existing operators

3. Market Economics

ADR Trends:

• Current ADR vs. historical
• Seasonal variations
• Competitive positioning
• Market saturation impact

Occupancy Rates:

• Average occupancy
• Seasonal variations
• Market saturation
• Demand stability

Profit Margins:

• Revenue vs. expenses
• Operating cost ratios
• Net profit margins
• ROI potential

Key Metrics:

• Average monthly revenue
• Average monthly profit
• Cash-on-cash return
• Payback period

4. Landlord Friendliness

Approval Rates:

• Overall approval rates
• Factors affecting approval
• Lease flexibility
• Subletting policies

Factors Affecting Approval:

• Professional presentation
• Clear value proposition
• Business registration (LLC)
• Insurance coverage
• References and credibility

According to 10XBNB Data:

• Generic requests: 12% approval rate
• 10XBNB pitch script: 34% approval rate
• Professional presentation increases approval by 183%

Hybrid Markets vs. STR-Only Markets

Hybrid Markets (STR + Medium-Term Rentals)

Advantages:

• Higher occupancy (85% vs. 62% in STR-only)
• Revenue stability (23% less variance)
• 40% higher average profits
• Diversified demand sources
• Lower seasonality impact

Top Hybrid Markets:

• Nashville, TN (87% occupancy)
• Phoenix, AZ (82% occupancy)
• Austin, TX (85% occupancy)
• Denver, CO (80% occupancy)
• Charlotte, NC (78% occupancy)

Best For:

• Operators seeking stability
• Those targeting consistent income
• Operators who want lower risk

STR-Only Markets (Tourism-Focused)

Advantages:

• Higher ADR potential
• Event-driven spikes
• Tourism appeal
• Premium pricing opportunities

Disadvantages:

• Lower occupancy (62% average)
• Higher seasonality
• Revenue volatility
• Event-dependent demand

Top STR-Only Markets:

• Savannah, GA (58% occupancy, $291 ADR)
• Orlando, FL (58% occupancy, $180 ADR)
• Las Vegas, NV (55% occupancy, $195 ADR)

Best For:

• Operators seeking high ADR
• Those comfortable with seasonality
• Operators who can capitalize on events

Markets to Avoid in 2026

Markets with Strict Restrictions

New York City:

• Local Law 18 restrictions
• Entire-unit rentals prohibited in most buildings
• Registration required
• Very limited opportunities

San Francisco:

• Strict permitting
• Primary residence requirement
• Limited permits available
• High compliance costs

Los Angeles:

• Home Sharing Ordinance
• Primary residence requirement
• Registration required
• Neighborhood restrictions

Boston:

• Registration required
• Owner-occupancy requirements
• Limited permits
• Strict enforcement

Oversaturated Markets

Some Beach Destinations:

• High competition
• Market saturation
• Declining ADR
• Lower occupancy

Major Tourist Cities:

• High competition
• Market saturation
• Regulatory pressure
• Declining profitability

How to Identify Oversaturation:

• Declining ADR trends
• Increasing competition
• Lower occupancy rates
• Declining profitability

Regional Market Analysis

West Coast Markets

Top Markets:

• Denver, CO (#5)
• Phoenix, AZ (#2)

Characteristics:

• Moderate to high ADR
• Good occupancy rates
• Moderate regulations
• Strong hybrid market support

Challenges:

• Higher startup costs
• Some regulatory restrictions
• Competition in popular areas

South Markets

Top Markets:

• Nashville, TN (#1)
• Savannah, GA (#3)
• Atlanta, GA (#6)
• Charlotte, NC (#7)
• Jacksonville, FL (#9)

Characteristics:

• Moderate to high ADR
• Good occupancy rates
• STR-friendly regulations
• Strong hybrid market support

Advantages:

• Lower startup costs
• Favorable regulations
• Strong demand
• Growing markets

Midwest Markets

Top Markets:

• Columbus, OH (#10)

Characteristics:

• Lower ADR
• Good occupancy rates
• STR-friendly regulations
• University/healthcare demand

Advantages:

• Lower startup costs
• Consistent demand
• Favorable regulations
• Affordable markets

Northeast Markets

Top Markets:

• Limited top markets due to regulations

Characteristics:

• Higher ADR potential
• Strict regulations
• Limited opportunities
• Higher compliance costs

Challenges:

• Strict regulations
• Limited permits
• Higher startup costs
• Compliance requirements

Emerging Markets (2026 Opportunities)

Markets to Watch

1. Boise, ID

• Growing tech sector
• Outdoor recreation appeal
• Moderate regulations
• Emerging hybrid market

2. Salt Lake City, UT

• Tech industry growth
• Outdoor recreation
• Moderate regulations
• Growing demand

3. Greenville, SC

• Manufacturing growth
• Business travel
• STR-friendly regulations
• Emerging market

4. Knoxville, TN

• University presence
• Healthcare industry
• STR-friendly regulations
• Growing market

5. Fort Worth, TX

• Business growth
• Corporate travel
• STR-friendly regulations
• Emerging market

How to Evaluate Emerging Markets:

• Population growth trends
• Job growth
• Tourism development
• Regulatory environment
• Competition level

Market Risk Assessment

Low-Risk Markets

Characteristics:

• Hybrid market support
• STR-friendly regulations
• Consistent demand
• Growing markets
• Low competition

Examples:

• Nashville, TN
• Phoenix, AZ
• Austin, TX

Medium-Risk Markets

Characteristics:

• Moderate regulations
• Some seasonality
• Moderate competition
• Stable demand

Examples:

• Denver, CO
• Atlanta, GA
• Charlotte, NC

High-Risk Markets

Characteristics:

• Strict regulations
• High competition
• Market saturation
• Declining demand

Examples:

• New York City
• San Francisco
• Oversaturated beach markets

Frequently Asked Questions

What makes a market good for rental arbitrage?

Good markets combine strong demand (tourism, business travel, university/healthcare), favorable regulations, hybrid market support (STR + MTR), and landlord-friendly environment. According to 10XBNB data, hybrid markets offer 40% higher profits and 85% occupancy versus 62% in STR-only markets.

Should I choose a hybrid market or STR-only market?

Hybrid markets are generally better for stability and consistent income (85% occupancy, 40% higher profits). STR-only markets can offer higher ADR but have lower occupancy (62% average) and higher seasonality. Choose hybrid markets if you want stability; choose STR-only if you can handle seasonality and want higher ADR.

How do I verify if a market is good for rental arbitrage?

Evaluate demand indicators (ADR, occupancy, tourism, business travel), regulatory environment (permits, restrictions, compliance costs), market economics (profit margins, ROI), and landlord friendliness (approval rates, lease flexibility). Use market data from AirDNA or similar tools.

What markets should I avoid?

Avoid markets with strict restrictions (New York City, San Francisco, Los Angeles, Boston), oversaturated markets (some beach destinations, major tourist cities), and markets with declining demand or profitability. Always verify regulations and market conditions before investing.

Can I operate in multiple markets?

Yes, many successful operators diversify across 2-3 markets to reduce risk and capitalize on different demand patterns. However, start with one market to learn operations, then expand once you’ve proven the concept. According to 10XBNB data, operators who start with one market have higher success rates.

Conclusion

Market selection is the most critical decision in rental arbitrage. The best markets combine strong demand, favorable regulations, hybrid market support, and landlord-friendly environment.

Key takeaways:

• Hybrid markets offer 40% higher profits and 85% occupancy
• Top markets: Nashville, Phoenix, Savannah, Austin, Denver
• Evaluate demand, regulations, economics, and landlord friendliness
• Avoid markets with strict restrictions or oversaturation
• Start with one market, then diversify once proven

Ready to find your rental arbitrage market? Join 10XBNB for market analysis tools, landlord pitch scripts, and mentorship from successful operators.

Related Guides

• Complete Rental Arbitrage Guide – The ultimate guide to rental arbitrage
• Rental Arbitrage Calculator – Calculate profitability by market
• Rental Arbitrage Legal Guide – Regulations by state and city
• Rental Arbitrage Profitability – Detailed profitability analysis

Last updated: January 22, 2026. Market rankings based on 2026 data and proprietary research from 1,247 successful 10XBNB students.