Some of 2026’s highest-yielding short-term rental markets look nothing like the vacation towns investors usually chase. A new ranking released Sept. 21 puts Rockford, Illinois, at No. 1 among 17 smaller “hidden gem” markets, followed by Akron, Ohio, and Warner Robins, Georgia. Every market on the list posted an estimated yield above 10%.
Freddie Mac’s latest benchmark puts the average 30-year fixed mortgage rate at 6.95% for the week ending Sept. 17. Investor-property financing can differ, so buyers should compare the financing options available for investment properties rather than treating the national average as their expected rate. Either way, higher borrowing costs put more pressure on purchase price when investors run the numbers.
What AirDNA’s ranking measures
The analysis targets smaller markets rather than established vacation hubs. To qualify, markets had roughly 400 to 1,000 short-term rental listings, positive year-over-year inventory growth, and rising RevPAR, according to reporting on the methodology. No more than 20% of listings in each market were professionally managed.
Rockford led with an estimated 14% yield, pairing an average home value just above $300,000 with roughly $42,000 in annual revenue potential. Financing and operating costs can materially reduce that return. An estimated market yield is not the same as an investor’s net profit.
Why smaller STR markets are moving up the list
This isn’t AirDNA’s first ranking of standout markets this year. Its January Best Places to Invest ranking put Port Arthur, Texas, first, followed by Abilene, Texas, and Downtown Saint Paul, Minnesota. Akron appears in both rankings.
The September analysis narrows the focus to smaller markets with favorable price-to-revenue economics and relatively little professional competition. Both lists show how lower-cost cities supported by recurring demand are competing with traditional resort destinations for investor attention.
Why purchase costs matter now
Recent operating data do not point to a broad drop-off in short-term rental demand. An August market review found that declines in demand and RevPAR were largely tied to Labor Day shifting into September, while average daily rates, bookings, and fall pacing remained stronger.
For buyers entering the market now, the purchase price still has to work alongside financing and operating expenses. Lower-priced secondary markets leave more room to absorb those costs, but only when the property can support realistic revenue assumptions rather than a best-case forecast.
What agents should verify before pitching an STR
Before presenting a property as a short-term rental opportunity, agents should verify local permitting and zoning rules, particularly as regulation continues to shape short-term rental supply. HOA or condo restrictions can narrow the options further.
Agents should also check current occupancy, average daily rate, RevPAR, supply trends, and seasonality for the specific submarket. Insurance deserves the same attention: a written quote can materially change the economics in areas exposed to flooding, storms, or other hazards.
Turn the ranking into a client screening tool
For investor clients, the list works best as a starting filter. Begin with budget, financing, and the kind of demand the buyer is comfortable relying on, then narrow the field before analyzing individual properties.
A conventional long-term rental scenario can provide a useful comparison where appropriate. If the investment works only under aggressive nightly rates or occupancy assumptions, that weakness is better uncovered before an offer than after closing.
The newest rankings expand the STR map beyond familiar beach and resort markets, but an attractive market-level yield still has to survive property-level underwriting. Current regulations, insurance, financing, local demand, and an exit strategy ultimately determine whether the address works—not its place on a national ranking.