The United States has over 19,000 cities, towns, and villages. Out of all these cities in the nation, two cities in Tampa Bay are ranked in the top ten hottest short-term rental markets for 2023; St. Petersburg and Tampa. St. Petersburg and Tampa are two of the most profitable cities to invest in rental properties in 2023.
Tampa Bay is an unparalleled paradise, and people throughout the country and the world are recognizing this. As a region along the gulf coast with urban and suburban areas and continuous sunshine, significant population growth, a booming tourism industry, elite sports teams, and a seemingly endless amount of events, it comes as no surprise that Tampa Bay has two of the hottest short-term rental markets in the nation.
Though closely intertwined, St Petersburg and Tampa are two separate cities located within Tampa Bay. Both cities are flourishing with new establishments, vibrant cultures, and attractions that appeal to short-term renters. The list of reasons we think Tampa Bay is the best area to invest in a rental property can go on, but there are plenty of statistics to back us up.
What is a Short-Term Rental?
Short-term rental laws and regulations vary by state and county. In Florida, a short-term rental is defined as any individual lease agreement with a duration shorter than six consecutive months. Criteria for short-term rentals that typically vary by state and county include:
- Zoning restrictions
- Licensing and Permitting
- Occupancy Limits
- Noise and Nuisance Regulations
- Safety and Health Codes
- Homeowners Association Rules
Short-Term Rentals in Tampa Bay
St. Petersburg is a city approximately 30 minutes southwest of Tampa, located in the southern part of the Pinellas Peninsula. St. Petersburg is often referred to as the “Sunshine City” because of its constant sunshine and clear blue skies. “What’s the weather going to be like?” is rarely a question here as sunshine is assumed.
According to data collected by AirDNA, a reputable source and #1 leading platform for short-term rental data, St. Petersburg is the 6th most profitable city to invest in a short-term rental property.
- Average home value: $520K
- Average yield: 11%
- Listing growth: 16% over the last year
- The strongest growth seen among suburban homes: 47.5%
- Average daily rate: $214
- Occupancy rate: 77%
- Revenue: $3,262
Aside from the warm climate and palm tree-lined streets, the city of Tampa has grown in prominence over the past few years because of its recent large-scale urbanization, top-ranked sports teams, and an array of events and entertainment opportunities for visitors. According to AirDNA, Tampa is the 8th most profitable city to invest in a short-term rental property in the nation.
- Average home value: $310K
- Appreciation rate: 13%
- Short-term rental listing growth: 25%
- The greatest growth seen among suburban homes: 50.8%
- Average daily rate: $164
- Occupancy rate: 63%
- Revenue: $2,105
What Kind of Property Should I Invest In?
In St. Petersburg, Florida, 93% of rentals are “entire home” rentals. Entire home rentals can include houses, apartments, and condos, where the whole home or unit will be available to the renter. Only 7% of short-term rentals are “private rooms,” meaning a single room within a house occupied by other guests or residents will be available to the renter. The average short-term rental in St. Petersburg has two bedrooms and space for about five guests.
- 40% of rentals have two bedrooms
- 33% of rentals have one bedroom
- 15% of rentals have three bedrooms
In Tampa, Florida, 88% of rentals are “entire home” rentals. Although a higher percentage than St. Petersburg, only 12% of rentals in Tampa are “private room” rentals.
- 37% of rentals have one bedroom
- 25% of rentals have three bedrooms
- 22% of rentals have two bedrooms
A house that has more than one bedroom will open up more opportunities for short-term rentals. With more than one room, your home will appeal to a larger demographic, people traveling with children, and groups.
Short-Term Rental Zoning
When doing general short-term investment research online, you may stumble upon websites that say owning a short-term rental in St. Petersburg or Tampa is challenging because of the zoning laws. Although strict zoning laws exist in St. Petersburg and Tampa, zoning is typical throughout the country. Zoning laws are a way to regulate the land and keep the community thriving.
In St. Petersburg, properties can be rented for periods under 30 days in certain zoning districts that allow hotels and motels. In the rest of the city outside of these zoning districts, short-term rentals with occupancy of fewer than 30 days are allowed only three times in a consecutive 12-month period.
In Tampa, short-term rentals are allowed in specific commercial and mixed-use zoning districts. Additional requirements and regulations might apply, depending on the particular zoning area; vacation rental owners are required to obtain a business license from the state of Florida and Hillsborough County. For more information, you can visit the Land Development Office website to inquire about specific requests.
To ensure compliance with zoning restrictions and avoid fines for short-term rentals in St. Petersburg and Tampa, it is important to research the local zoning ordinances. You can consult with the City Planning Departments for more insight and information regarding your property.
Is There a Demand For Short-term Vacation Rentals?
Investing in a short-term vacation rental in Tampa Bay will be a profitable investment because there is a high demand. The demand is high throughout the United States, but St. Petersburg and Tampa are wise investment choices being that they are both ranked in the top ten hottest short-term rental markets.
The COVID-19 pandemic changed the way we work and the way we live. Only recently, on May 5, 2023, the World Health Organization declared the end of the global Public Health Emergency. Although most people have adjusted back to their normal lives, the pandemic has had a lasting impact on us.
The increase in remote jobs and digital nomads is a strong factor in the demand for short-term rentals. During the pandemic, most people who did not fall under the category of essential workers worked from home. After quarantine restrictions were lifted, remote jobs continued, and many people did not return to work in person. People discovered that working remotely is effective, and therefore there has been a national shift in the way we work.
The shift to remote work has increased digital nomads, with 23.2 million digital nomads currently in the United States. Digital nomads are people who travel while working remotely. These people do not have to be in one specific location for their job, so they can either move away from their company headquarters or travel freely with no need to stay in one city.
With the ability to travel, people can explore new cities within the United States without taking time off work. Cities like St. Petersburg and Tampa appeal to digital nomads because of the climate, vacation-like lifestyle, and abundant work-from-home spaces like shared office spaces and cafes on every corner. Digital nomads will often only stay in one location for a short period of time, opting for short-term rental homes.
Universities in Tampa
The COVID-19 pandemic also inspired an increase in college applications to schools in Tampa, such as the University of Tampa and the University of South Florida. Pandemic restrictions were lifted much sooner at these universities than those located in other cities and states. Students that sought freedom from strict COVID-19 restrictions and a “normal” college experience came to Tampa.
Why is this important for short-term rentals? Well, many students in Tampa opt for short-term off-campus housing. Students at the University of Tampa and the University of South Florida typically move off-campus before their junior year and often stay for summer break.
- At The University of Tampa, 54% of students live off-campus
- A the University of South Florida, 82% of students live off-campus
Tampa Bay Tourism
The tourism industry in Tampa is currently booming and will continue to excel. In 2018, 23.6 million people visited Tampa, contributing $6.6 billion to the local economy. Between January and March of 2023, there was a new record number of 37.9 million visitors to Florida. Tourism supports more than 53,000 local jobs, Tampa’s second-fastest-growing local job sector.
St .Petersburg Events and Attractions
St. Petersburg is home to some nationally and internationally recognized events that attract tourists from other states and countries.
The SHINE Mural Festival is a festival that celebrates art and culture in Downtown St. Petersburg and the surrounding arts districts. This festival invites local, national, and international artists to celebrate creativity and spark conversations by painting murals throughout the city. Featured artists from Spain, Germany, Canada, Los Angeles, Boston, and Miami have traveled to St Petersburg for this festival.
In March, the Firestone Grand Prix of St. Petersburg is a motorsport race in the Indycar series. This thrilling event brings in participants and their crews, motorsport lovers, and even international fans. The event usually takes place over three days, resulting in a demand for short-term rentals.
St. Petersburg also holds Florida’s largest LBGTQ+ Pride celebration. Pride events occur in St. Petersburg throughout June; however, people travel from all over the state to attend the Pride parade at the end of the month.
Aside from annual events, St. Petersburg attracts tourists from all over the country because of its beautiful beaches, museums, and vibrant culture. There is no shortage of tourist attractions and entertainment in St. Petersburg for people of all ages, one being Tampa Bay Rays games which bring in over a million attendees per season.
Gasparilla is the most significant event in Tampa Bay. A day of celebration is an understatement to explain the amount of excitement that occurs on this party-filled day in Tampa. This festival is the most anticipated and talked about event in Tampa. Gasparilla’s pirate-themed festival brings community members together while embracing all the visitors who come to celebrate the event. The parade usually attracts over 300,000 people, making it the third-largest parade in the United States. This is an example of one of the many times Tampa short-term rental property owners reap the benefits of their investment.
Since the Florida State Fairgrounds is located in Tampa, another event that attracts many visitors is the Florida State Fair. The Florida State Fair is one of the largest and most important events in Florida, bringing in over 500,000 people each year. Many vendors, show participants, and fairgoers spend the 12 days of the festival in short-term rental properties.
The list of events and tourist attractions that bring visitors to Tampa is extensive. Although it would take forever to list them, some include the Tampa Bay Lightning and the Tampa Bay Buccaneers, who have made a name for themselves and cultivated a solid fan base.
The Tampa Bay Convention Center and Amalie Arena also host various events throughout the year, including concerts, NCAA tournaments, corporate conventions, and fairs.
Tampa Short-Term Rental Property Manager
Owning a short-term vacation home in Tampa Bay can be an excellent investment opportunity. Your investment can operate much more successfully if you hire the right Tampa Vacation Property Management Company. At The Listing Real Estate Management, we produce higher returns for our rental property owners by providing outstanding services.
Our Tampa Bay vacation property management team produces higher returns for our valued rental property owners. Allow our 15+ years of Tampa property management experience work for you and your rental investment. Contact us today to learn more and to take advantage of the profitable experience of owning a short-term rental property in Tampa Bay.