The Most Profitable Cities For Holiday Home Lettings

To reveal the world’s best cities to purchase and rent out a holiday home, CIA Landlord Insurance has analysed 50 cities with thriving tourism ecosystems, ranking them based on metrics including tourist arrivals, house purchase prices per m2, average temperatures, and more. 

Las Vegas is the most profitable city for holiday home owners, with potential earnings reaching almost £17k per month

Las Vegas ranks as the most profitable city to own and rent out a holiday home, and it’s one of four US cities in the top ten. In Nevada’s most populous city, Las Vegas, holiday home owners can earn an average of £16,920.00 each month from Airbnb rentals and could pay just £16,888.48 for a two bedroom property – this means the investment could pay off in just one month’s time.

Hong Kong is the least profitable to buy a holiday home in, taking almost 23 years to pay off the price of the property

According to the analysis, Hong Kong is the least profitable city for buying and letting a holiday home. With the average monthly income from a two bed property on Airbnb being £7,660.00 and purchase prices averaging £2,101,908.58, investors in this market won’t see a return for almost 23 years (274 months).

Istanbul is the world’s best city to buy and let a holiday home

Istanbul tops the list as the best city in the world to buy and rent out a holiday home, with house prices averaging £195.67 per square metre and the potential to earn £3,053.00 each month from renting a two bedroom property out on Airbnb. Property prices across Turkey are set to increase by 161% in just one year and will rise by 758% over the next ten years.

As a popular tourist destination, Turkey’s largest city saw 14,716 travellers pass through arrivals in 2019, many of which were likely attracted by the 15,205 restaurants and 438 bars.

The data above shows that the best cities for buying and renting out a holiday home are in high tourism areas where the potential Airbnb rental earnings massively outweigh house prices. However, anyone who is considering purchasing and letting a holiday home should also be aware of yearly trends in property prices.

Methodology & Sources:

Starting with a seedlist of the 100 countries with the highest number of international arrivals in 2018, CIA Landlord ranked each one based on the following metrics:

• Average monthly price for 2-bed Airbnb
  • https://www.airbnb.co.uk/
  • https://www.phillyaptrentals.com/blog/what-size-is-considered-a-big-2-bedroom-apartment/
  • https://www.phillyaptrentals.com/blog/what-size-is-considered-a-large-1-bedroom-apartment/
• Destination profitability
  • The profitability of destinations was determined by finding out how quickly it would take for the landlord to earn their money back if they rented it out using Airbnb and then also how much money can make once the total cost of the profitability is paid off.
• Sunshine hours
  • https://en.wikipedia.org/wiki/List_of_cities_by_sunshine_duration
• Average temperature
  • https://worldpopulationreview.com/country-rankings/hottest-countries-in-the-world
• Number of restaurants
  • https://www.tripadvisor.co.uk/
• Number of bars
  • https://www.tripadvisor.co.uk/
• Purchase cost of buying a holiday home
  • https://www.numbeo.com/cost-of-living/
• Home price trends
  • https://www.globalpropertyguide.com/home-price-trends
• Utility cost
  • https://www.numbeo.com/cost-of-living/in/London

Find the full research here: https://www.cia-landlords.co.uk/news/the-worlds-best-cities-to-purchase-a-holiday-home-in-2023/