Are STRs Still A Good Investment in 2025: 3 Key Shifts and Winning Tactics

The world feels a little shaky right now.

Markets are up one week and down the next. Global tensions are high. Inflation is still lurking. And everyone’s asking the same question: Where should I put my money?

If you’re wondering if short-term rentals still make sense in 2025—this one’s for you.

Let’s break down the major risks and changes worth your attention, and a few strategies to protect your business.

Why STRs Still Deserve a Spot in Your Investment Strategy

Real estate investments, especially short-term rentals, can outperform many traditional investments.

In Q1 2025, Airbnb reported $2.1 billion in revenue—a 21% year-over-year increase.

According to AirDNA, global STR demand hit a new record in March 2025. And average daily rates and revenue per available room are up year over year in many markets.

The industry is growing, and Airbnbs are still a strong investment. But with new updates, stricter regulations, and rising competition, hosts need to adapt fast and be proactive to survive.

3 Major Shifts in the STR Market You Can’t Ignore

Here are the biggest changes shaping Airbnb hosting in 2025.

1. Airbnb Services: You Take the Risk, They Take the Cut

Airbnb’s recently rolled out "Services". Guests can now book chefs, photographers, massage therapists and more during their stay.

Sounds great. Until you realize:

• Properties are opted in by default
• Guests don’t need permission from hosts
• Hosts accept the liability for third parties on-site
• Airbnb takes a cut, but hosts get nothing
• Background checks for providers are still a gray area

Your property, furniture, and utilities get used—with no financial return.

Opting out isn’t simple either. There’s no in-app setting you can turn off; you have to contact Airbnb directly.  And if you do, this could affect your search ranking.

The Strategy

Here’s the deal, Airbnb might make Services compulsory for Superhosts in the future. So don’t just opt out—make the service work for you.

✅ Build your own network of trusted local chefs, trainers, and service providers

✅ Run your own background checks

✅ Work with providers and take a cut of fees

✅ Write contracts and set clear house rules to protect your guests and property

✅ Talk to your insurance provider to confirm coverage

✅ Regularly review Airbnb’s AirCover terms for updates

2. Growing STR and Airbnb Regulations

In the last 12 months alone, 400+ cities introduced or tightened STR regulations. That’s 33 per month.

Hosts got hit with fines, delistings, or outright bans overnight. One incident or neighbor complaint can bring in new restrictions that put your entire business at risk.

Here are some of the ways cities can try to discourage or restrict short-term rentals.

• Principal residence requirements – homeowners must live on-site (e.g. NYC, Santa Monica)
• Listing number limits – like Seattle’s two-unit limit for owners.
• Nights per year caps –  A limit on the number of nights hosts can rent out a property in a year (e.g. Paris, 90 days).
• Minimum stay rules – guests must stay for a minimum number of days, like 90 days, to legally book a stay. This effectively turns your STR into an MTR (mid-term rental).
• Whitelist zones – STRs are only allowed in specific areas designated by the city.

And in some extreme cases, cities can completely ban Airbnbs and short-term rentals.

The Strategy

✅ Buy in markets with existing, clear STR regulations (If it feels like the Wild West, it probably won’t last.)

✅ Meet with county officials and build relationships with neighbors.

✅ Enforce strict guest rules (noise, parties, parking) to avoid complaints.

✅ Build equity, not just cash flow and have an exit strategy in case you need to sell.

3. The War on Direct Bookings

With Airbnbs constant changes, it’s wise to diversify with multiple platforms and a direct booking website.

But direct bookings are a huge threat to Airbnb's revenue and future growth. So they're pushing back with message scanning for links/numbers and strict communication rules.

And if you try to take guests off-platform, you might get suspended.

The Strategy

Airbnb spends a lot of resources marketing your stay and showing your listing to new people. So be fair. Don’t be the host who tries to take every guest off-platform for their very first booking.

Focus on repeat guests, not first-timers. Let Airbnb bring them in—then bring them back, your way.

Here’s a simple strategy to grow your direct bookings:

• Capture emails with your Wi-Fi login
• Send post-stay discounts to book direct
• Build a social media presence to grow brand loyalty
• Partner with local businesses and events for exposure

TL;DR: How to Stay Ahead of Airbnb’s Updates & Changes

If you want to build a future-proof short-term rental portfolio, here’s your cheat sheet:

✅ Go unique or remote

Domes, tiny homes, and treehouses are outperforming traditional listings.

✅  Double down on your brand and direct bookings

OTAs like Airbnb are unpredictable. Own your audience. Start a simple direct booking website and build an email list.

✅ Buy in regulated markets

Look for areas that welcome STRs and have clear rules and permitting processes.

✅ Think beyond cash flow

Build equity for a stronger exit strategy. Have a plan if regulations change overnight.

✅ Explore midterm rentals (MTRs)

Monthly stays often sidestep STR regulations. Start building a strategy to draw in more MTR clients.

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✅ Consider scaling up and going commercial

Larger, purpose-built STRs often come with more regulatory flexibility and growth potential. If you’re playing the long game, this should be your next real estate goal.

✅ Stay legally protected

Update your insurance. Know where you stand with Aircover and Airbnb's new features.

So… Are Airbnbs Still a Good Investment in 2025?

Absolutely—but only if you’re willing to play like a pro.

Unlike other traditional investments, STRs let you create cash flow, enjoy tax incentives, and even build equity if you do it right.

Airbnb is more than an investment, it’s a growing business with lots of potential, even during turbulent times. For example, many Airbnb markets thrived even after COVID when occupancy was expected to drop.

But… the “easy money” phase is over. The hosts thriving today are:

• Thinking like investors
• Building brands, not listings
• Designing memorable experiences
• Staying flexible and future-focused

Ready to join the Airbnb big leagues?

👉 Join Host Camp for just $1. We'll give you the coaching, resources, and community you need to build a sustainable STR business—no matter what the market throws your way.

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