Houston Short-Term Rental Market Report 2025: Revenue, Occupancy & Investment Insights
Houston Short-Term Rental Market Report 2025: Investment, Revenue, and Occupancy Insights
Houston Short-Term Rental Market Overview
Houston continues to stand out as one of the most dynamic cities in Texas for short-term rental (STR) investments. With its diverse economy, booming medical and energy sectors, and consistent influx of travelers, the city provides fertile ground for Airbnb and vacation rental hosts seeking high returns. In 2025, data reflects sustained growth in average daily rates (ADR), occupancy rates, and annual revenue, despite evolving regulations and shifting traveler expectations.
Key Performance Metrics in 2025
| Metric | Value |
|---|---|
| Average Daily Rate (ADR) | $158 |
| Occupancy Rate | 58% |
| Annual Revenue (Median) | $36,950 |
| Revenue per Available Rental (RevPAR) | $91.64 |
| High Season Months | March, April, October |
| Top Performing Zip Codes | 77007, 77019, 77098 |
These metrics indicate solid profitability, particularly for well-located, well-managed properties. Premium performance is often tied to proximity to the Medical Center, Galleria, and Downtown, with unique experiences and professional-grade amenities boosting guest satisfaction and repeat bookings. For a seamless experience, we are here to manage and respond to reviews to enhance your online reputation.
Top Neighborhoods for STR Investment in Houston
1. Midtown
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ADR: $172
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Occupancy: 62%
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Features: High walkability, vibrant nightlife, proximity to Downtown
2. Museum District
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ADR: $188
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Occupancy: 64%
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Features: Cultural attractions, family appeal, strong weekend demand
3. The Heights
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ADR: $149
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Occupancy: 60%
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Features: Historic charm, boutique shops, popular with long-weekend travelers
4. Galleria/Uptown
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ADR: $168
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Occupancy: 59%
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Features: Luxury shopping, business travelers, convention guests
Revenue Potential by Property Type
| Property Type | Median Revenue | Optimal Use Case |
|---|---|---|
| 1BR Apartment | $27,300 | Couples, solo travelers |
| 2BR Condo | $35,800 | Small families, professionals |
| 3BR House | $48,200 | Groups, longer stays |
| 4+ BR Homes | $61,000+ | Family reunions, business retreats |
Larger homes consistently outperform in revenue, especially those offering dedicated workspaces, modern amenities, and outdoor features like pools or patios.
Seasonality and Booking Trends
Houston experiences strong seasonal variation, with March through April and October through November being peak months. These periods coincide with major events such as the Houston Rodeo, Art Car Parade, and various conferences.
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Lead Booking Time: ~23 days
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Average Stay Duration: 3.6 nights
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Weekend Premium: +22% ADR on Fridays and Saturdays
Home Cohost will manage your calendar, pricing, and booking policies — all within legal limits.
Regulatory Landscape and Compliance
While Houston does not currently impose restrictive citywide STR bans, certain HOAs and neighborhoods enforce their own rules. Hosts are advised to:
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Register with Harris County Appraisal District (HCAD) for accurate property classification.
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Collect and remit Hotel Occupancy Taxes (HOT) to both city and state authorities.
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Use professional legal review to navigate deed restrictions and HOA covenants.
Our comprehensive guide will help you understand regulatory compliance.
Host Earnings Breakdown by Percentile
| Percentile | Annual Earnings |
|---|---|
| Top 10% | $92,000+ |
| Top 25% | $61,400 |
| Median (50%) | $36,950 |
| Bottom 25% | <$18,200 |
Top earners consistently invest in professional property management, smart pricing algorithms, high-quality furnishings, and digital guest communication tools.
Suggested Strategy for New Investors
Target Properties
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2–3 bedroom units near the Texas Medical Center, NRG Stadium, or Downtown
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Properties with flexible zoning and minimal HOA restrictions
Optimization Tips
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Install keyless entry, high-speed Wi-Fi, and hotel-quality linens
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Partner with local cleaning services to ensure 24-hour turnaround
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Use dynamic pricing tools like PriceLabs or Beyond to adapt to market shifts
Why Houston is a Prime STR Destination
Houston presents a powerful opportunity for short-term rental success, combining economic growth, event-driven tourism, and diverse accommodation needs. Operators who align property type with neighborhood demand, use data-driven pricing, and prioritize guest experience will continue to see strong returns in 2025 and beyond.
For those serious about maximizing rental performance in Houston, early investment in systems, compliance, and analytics is no longer optional it’s essential. Our guide will help you to understand why Houston?