Case to be made:

Niagara Falls, New York, is a profitable location for an Airbnb rental property.

Data points to analyze:

  • Short-term rental cap rate
  • Attraction points for visitors
  • Local legislation
  • Deal availability
  • Strategic options


The vacation- and short-term rental game is changing. Many investors are buying vacation rentals in markets where they would previously not have considered owning a property. Because investors are selecting short-term rental markets differently, a new set of criteria must emerge to help guide that selection.

In this case study, we will break down the factors that make Niagara Falls, New York, a promising short-term rental market, particularly in light of Airbnb investments.

Short-Term Rental Cap Rate: Positive

According to Mashvisor’s August 2018 report, the cap rate for short-term rentals in Niagara Falls is 6.2 percent. This is significantly more than what the majority of U.S. real estate markets offer at the moment.

Attraction Points for Visitors: Confirmed

Niagara Falls tourism outlets estimated about 14.5 million people visited the Falls in 2017, and most estimates indicate Summer 2018 may have been the most populous tourist season yet. The Observation Tower in Niagara Falls State Park offers a view of all three waterfalls, making rentals in Niagara Falls, New York, prime locations for vacationing families.

Local Legislation: Strict but with options

If you decide to invest in this city, you must consider the strict Airbnb rentals legislation which was introduced by the City Council in April 2018. Airbnb rentals of an entire property without the owner being present at the site are now allowed only in the downtown and tourist areas.

Deal Availability: Confirmed

Although home values in the Niagara region have been rising, home prices are still highly affordable relative to other areas of the country. Median home values hovered around $102,000 in Niagara County over the past year and rose about 7 percent. Most analysts predict they will continue to rise into 2019.

Strategic Options: Confirmed

Although short-term rentals are only permitted in certain areas, bed-and-breakfast establishments are permitted anywhere a single, detached dwelling is permitted. Investors working locally may find the bed-and-breakfast option attractive if they were thinking of Airbnb investing as a route to remodeling and modernizing an older property to rent out on a bed-and-breakfast basis. Airbnb lists some vacation experiences like this on its site, so owners likely could still leverage the advantages of the platform.

Conclusion: The Niagara Falls, New York, market offers positive opportunities for Airbnb and other short-term rental investing strategies.
Tags | Airbnb | Rentals
  • Daniela Andreevska

    Daniela Andreevska is VP of Content at Mashvisor, a real estate data analytics company. With her market analysis and real estate tips, she’s been helping investors make smart, data-driven decisions for the past 6 years.

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