In today’s episode, we’re diving into the short term rental crystal ball for 2026. No, I don’t have an exact crystal ball, but I do have a pretty good idea and I’m super excited about some of the changes taking place. Everything from changing markets to technology. To management trends and investment opportunities, especially, I’m diving into why I’m more excited this coming year about the opportunities we have as an STR investor than I have been in years.

Stay tuned.

Welcome back to the Short-Term Rental Riches podcast. I’m happy you’re here again, and I’m excited to do my outlook, my take on what to expect in 2026. And believe me, we got a lot of good changes coming if you’ve been tuning into the show for a long time. Well, you know, we started. As their real estate podcast, but with a focus on short-term rentals.

I used to talk a lot about real estate investing in general and the fundamentals, but I haven’t done so much of that in the last few years because it just hasn’t been that great of a time to be investing

with interest rates. Higher cash flow was down and with higher property values. Things just got really competitive and so I personally haven’t purchased anything in several years. Yes, I’ve been building a new construction project for quite a while. Excited to share updates on that in the near future, but I haven’t actually acquired any new short-term rentals.

I’ve been focused on managing those properties that already have in my portfolio as best as we possibly can, My team and I have also expanded to manage hundreds of your properties as well, and so that’s been an awesome journey. We have a ton of insight and I’m excited to break down some of those details But let’s take a step back first and let’s talk about the economy in general, because what happens in the long-term rental or residential real estate world really affects short-term rentals, and we have some fundamental changes taking place as we speak.

We talked about interest rates already recently on episode three 18, so if you missed that one, go back and check it out. One of the highlights from that episode was that interest rates are going down, they’ve already gone down, and they’re forecasted to continue going down.

So this is music to my ears. This is also part of the reason why I’ve recently put up several properties for sale. I’m gonna be doing some exchanges and finally moving some things around, because as interest rates come down, that means more people can afford to buy properties, and that means more properties are going to be changing hands.

So we don’t know exactly how far they’re going to come down, but the good news is they’re headed in the right direction. We also had a very significant tax change that happened in 2025, and that is that the return of a hundred percent bonus appreciation came back.

And that is also great news for a real estate investor. That’s also more incentive for someone to purchase real estate.

Because as we know, real estate provides more tax benefits than any other investment class available.

Now, a lot of you have also heard of Trump’s proposal for a 50 year mortgage, and you might think at first that that is just the dumbest thing that you’ve ever heard, because someone will pay twice as much interest as they would with a 30 year loan. But as a real estate investor, this is good news.

The whole idea of real estate investing is cash flow, right? We buy a property expecting to earn more than our expenses, and one of those really big expenses are our loan payment. And so if we can lower our loan payment on a fixed basis, then we have the potential to earn more cash flow. And the best part of the story is that you’re not actually the person paying down that loan, That would be your long-term tenants or your short-term rental guests.

And remember, with an investment loan, you also get to deduct all of your interest off of that loan. And so if you’re paying more interest, you have more deduction. 

So whether you think 50 year mortgages is a great thing or a really stupid thing, the reality is that it’s going to make properties more affordable for people because the monthly payment is going to be lower and the more affordable a property is. The more people will try to buy it. So my prediction for 2026 is that housing prices are gonna continue to go up.

And I know there’s tons of doom and gloomers out there, YouTube channels dedicated to freaking you out, but that’s not my take.

And I actually don’t even see how that’s possible because we are at a historic low for inventory. There’s a roughly 850,000 homes available for sale in the US Now that rates are going down, we have more tax advantages, and we’ll potentially have a longer loan term, that all means more demand , and that simply means that prices should continue to go up.

Now with interest rates being lower and expected to continue to go down, this means that a lot of short-term rental owners out there that maybe weren’t performing that well are gonna list their properties for sale.

And this creates a really good opportunity for any of us savvy, short-term rental investors that really know how to operate a property and optimize its performance, optimize its revenue.

We’re gonna get into a few of the management changes happening nationwide in just a quick second.

So just because things are looking good in the economy doesn’t mean that every market is good for short-term rental investments. Of course, there have been lots of regulations passed. Barcelona just banned short-term rentals, for example. I think that that will continue, but not overwhelmingly.

I think it’ll continue to happen in places that are more dense and that are higher priced. A lot of times, like coastal areas like Los Angeles, like Miami.

Another trend that I see in the short term rental industry that I do not see going away, and I see picking up speed is the trend in midterm rentals. And this in part comes from regulations, right? If you have a market that’s limited your property to a 39 plus stay, well then you’re no longer gonna be a short-term rental host.

You’re gonna be a midterm rental host.

If you missed our episode with the CEO of Furnish finer, go back and check that out. That was episode 3 0 8. 

That episode was full of reasons that might lead you to want to go down the midterm rental route. But one of the main ones is, is that it’s just easier to manage midterm rentals than it is short-term rentals, right? Because you have less reservations, it’s much closer to a long-term rental. Maybe your guest is there for a month or three months versus two or three nights.

We also know that a lot of short-term rental markets saw a huge increase in supply. Tons of properties came on the market and, and a lot of the dense urban areas, the midterm rental strategy can become a really good one.

Now, you don’t necessarily need to go full midterm rental, right? Your property may be in an area that’s suited really well for short-term rentals, but during the high season, and then you switch to midterm rentals. So the goal is to optimize revenue with your property. But I do see midterm rentals continuing to grow in popularity, and there’ll be more and more, and there’s also gonna be a lot to figure out.

On the operation side of that because we basically have two different segments, right? We have the long-term rentals and short-term rentals, and they both have really good tools, but those haven’t really merged yet into the midterm rental space. So I’m excited to see what comes out in 2026.

All right, let’s jump into operations and management, and this is really the key success for any investment property. You can have the nicest property in the world, but if you don’t know how to manage it well, it’s not going to do well. Right? 

And we see this over and over again with short-term rentals, where a property that maybe doesn’t look as nice as the one right next door earns way more money. So it really comes down to the operations and we’re seeing some really big trends happen, especially with the national property managers like Vac Casa.

I’ve got some stats right from Air DNA. I’m just gonna go ahead and read them off. From 2019 to 2024, the churn rate for property managers with a 4.7 average review score or higher is around nine to 11% per year. That means they’re losing nine to 11% of their customers, of their owners per year.

Doesn’t mean that they’re not adding properties, it just means that’s how many they’re losing. That’s their churn rate.

Now, if we look at property managers that have a 4.7 or lower, last year in 2024, their turn rate was 24%. Imagine that. Imagine your Vac Casa, and let’s just say they had 10,000 properties. They have much more than that. That means they were losing 2,400 properties per year, and it makes sense why, right? If you don’t have a, at least a 4.7 review score.

You’re not going to earn as much money with your properties,

and we’ve seen that these large property managers do not do a great job locally. Of course, not in all markets, right? They can do a good job in a lot of them, but as a whole, we’re looking at their average review score.

It is going down, and I expect those to continue to go down.

So it’s not looking good for large property managers or nationwide property managers that don’t have a good grasp on their local management.

That’s one of the reasons my team and I have been partnering with owners like you across the nation to work with your local team, but to take all the headache away on the back end.

We help you optimize your properties. We handle all the guest communication, we handle revenue management, listing, setup, everything on the backend, and we’ve been seeing really, really good results. So if you’re interested in chatting with us, you can head to t riches.com. There’s a little partner with us button, and we’d love to jump on a call with you and talk about your properties.

Another trend that we’ve been seeing, and I expect to continue our shorter booking windows.

Guess are booking your properties with less and less time in advance, and that means that your revenue management strategy has to change. If your average booking window used to be four weeks, but now it’s two weeks and you have some last minute discounts set up in there, well, you’re leaving a lot of money on the table.

So those are things you really need to understand about your specific property and your market. And another thing that we’re seeing is that everyone’s using a dynamic pricing tool now, right?

So if everyone’s using the same dynamic pricing tools, then how can you actually get your property to perform better? Well, you need to look at some things that the pricing tools aren’t accounting for. Those would be things like your specific review score or your channel markups between the different OTAs.

We’re gonna get to the OTAs here in just a second. You want to consider things like promos on those different travel sites,

And of course, you need to know who your ideal guest avatar is and make sure that the marketing on your property speaks exactly to that person.

According to Air, DNA supply has been growing nationwide around 3% per year, but that growth is slowing.

A lot of people got into the short-term rental market, and I think 2026, there’s gonna be quite a few people getting out. They realized it’s just way too hard. Maybe they’re not making as much money as they wanted. So supply and demand is one of those other things that you’re gonna want to keep a very close eye on if your market is losing supply.

Then you should be able to increase your prices.

2026. Your review scores are gonna continue to be more important than ever, and I know I say this all the time, but we can see just the way the OTAs are set up now that they’re really prioritizing their top properties. Airbnb created their guest favorite badge, for example.

Which means they’re no longer looking at the host’s ability to manage a portfolio properties, but they’re breaking it down to specific properties, and we know that the guest favorite badge goes a long way in your visibility.

According to Air DNA, the difference in average RevPAR from a top performing property to an average performing property. Is over 15% and now that is an average. So it’s really hard to bucket all the properties together. And we know that there are some that are earning way more, even twice as much as a similar type property because they’re doing an excellent job at revenue management.

They’re listing set up perfectly and they have excellent, excellent review scores.

So to sum up the operations and management, we’re seeing these national property managers basically lose all their business because they’re not doing a good job.

And on the flip side, it means that if you’re doing a really good job, there’s a lot of opportunity to outperform your competition.

Okay onto technology. I couldn’t do an outlook or a forecast for 2026 without including artificial intelligence. And we’ve done episodes on this in the past, but I believe. A hundred percent. 2026. There’s gonna be way more AI in the short-term rental industry than there has ever been, and for a couple reasons.

First of all, it doesn’t forget anything, and if it knows all the details about your property, then it can respond much faster than you can.

And one of the big ones is its tone, the weight. It actually can, and I say can because it really depends on how you have this set up, but how it can communicate with guests. It’s not going to get upset when it receives a message from a guest that’s mad because maybe the miss or flight or whatever it happens to be.

It’s always gonna respond with the best tone possible.

Humans, for example, we don’t have that luxury. We’re emotional creatures, right? And so if we get a response from a guest that says they didn’t like our property, but we love our property, and we put our heart and soul into it, well, we might be inclined to respond in a way that that’s not perfect. I guess you could say it could be emotionally driven, where AI does not have that downfall.

The other big place that we’re gonna be seeing AI is actually in the way that people find our properties. So I don’t know about you, but I haven’t used Google in a long time. I use chat PT or Claude or Gemini. You pick your favorite to do all of my web browsing these days, and I’m sure you’ve noticed when you search for something, it gives you links to websites.

So SEO, the old search engine optimization is kind of going out the window. Right? And now we have what they’re calling a EO, which is content driven,

and AI is gonna be searching for answers that they can provide all of their users. So having some specific keywords is less important than actually providing a good overall answer. 

Hopefully you have a direct booking website and on that direct booking website, you’re gonna want to have some really good content that a potential guest would be searching for in your market.

One other place that AI is going to affect search is actually directly on the OTAs, like Airbnb or booking.com. You’ve probably noticed that on Airbnb. They ask you for a lot of personal information. Now you don’t have to give it all away, but the idea behind that is that they want to start matching guest profiles with host profiles.

Booking dot com’s doing the same thing. And so the properties that are now showing up on these search results are all driven by some algorithms and AI in the background trying to make the perfect match.

And that leads me to the next trend that we’re already seeing, and that is definitely not going away in 2026. And that is the rise of other OTAs, other online travel agencies, not just Airbnb. booking.com is making a lot of headway. We get tons and tons of really great reservations from booking.com.

So if you’re not on there yet, go to str riches.com, check out our prior episodes. We’ve done lots of episodes just on booking.com and how to get it set up on their platform the right way.

We know that booking dot com’s releasing a damage protection program similar to Airbnb’s, so I expect them to gain a lot more traction in the US in 2026.

But it’s not just booking.com, that’s gonna be growing Google Vacation rentals. Other sites like WIM Stay or Hopper, if you’re not on these platforms yet, well, it’s very likely that your property management software already has a connection with them, and we want to get maximum visibility on all of these OTAs.

Of course, you can have different channel markups between the different channels. We know that Airbnb just changed their host fee. So it’s much higher than it used to be. You wanna make sure that you have those markups in place,

Assuming you have those markups jump on the other platforms, you’re going to get more visibility. And more visibility means more demand. More demand for your property means more bookings.

2025 has been an awesome year. But I’m really excited for 2026, not just because of the real estate fundamentals, allowing us investors to have more opportunity, potential for more cash flow, but also because there’s just gonna be a lot of properties changing hands, right? And so if you’ve been on the sideline and you haven’t quite got your first short term rental yet, 2026 is your year.

But remember, just because you find a good property at a good price doesn’t mean it’s going to perform well. You have to make sure you’ve crossed your T’s and dotted your I’s and you know what you’re doing when it comes to operations.

I hope this show has helped provide you some tips. That is my goal, and until next week, I hope you have a fab this week.