Iowa's Leading Airbnb Investment Destinations

If you're an Airbnb investor looking to capitalize on the burgeoning vacation rental market in Iowa, you've come to the right place. This guide will explore a range of markets across the state, each with their unique appeal and financial prospects. We'll delve into details such as return on investment (ROI), average daily rate (ADR), occupancy rate, and other key factors that make these markets stand out.

Awning empowers you to effortlessly discover the crème de la crème of Airbnb markets throughout the United States with its Top Airbnb Market tool. With monthly updates, this comprehensive tool provides rankings and direct links to each market's Airbnb data, ensuring you have the information you need to make well-informed decisions.

Discover some of the top markets in Iowa for Airbnb investors:

1. Arnolds Park - Best for summer vacation rentals
2. Des Moines - Best for diverse tourism and large market size
3. Cedar Rapids - Best for high ROI and low competition
4. Dubuque - Best for historic appeal and annual events
5. Clear Lake - Best for lakeside retreats and outdoor recreation
6. Davenport - Best for riverside location and promising ROI
7. Iowa City - Best for student population and event-based demand
8. Decorah - Best for scenic beauty and cultural charm

1. Arnolds Park, IA

For investors seeking a lucrative opportunity in the Airbnb rental market in Iowa, Arnolds Park is a highly appealing choice. Situated on the scenic shores of Lake Okoboji, this charming town attracts a significant number of tourists, particularly families and young adults, making it a popular summer vacation destination.

Arnolds Park boasts a promising ROI of 12%, indicating the potential for substantial financial gains. With an estimated annual revenue of $29,000, investors can expect consistent returns from their Airbnb properties. The average Airbnb price in the area stands at $297,000.

The market size in Arnolds Park is classified as small, with 88 active Airbnbs. This indicates a competitive yet manageable market where investors have the opportunity to stand out by offering unique and high-quality rental properties. Highlight the charm and appeal of Arnolds Park as a summer getaway, emphasizing its proximity to the pristine waters of Lake Okoboji.

The average daily rate of $253 signifies the market's inclination towards higher-end properties, indicating a willingness among guests to pay a premium for exceptional experiences in this idyllic setting.

With an occupancy rate of 43%, investors have the opportunity to optimize their rental income by strategically managing bookings and targeting peak seasons, holidays, and local events when demand is highest. Effective marketing strategies, such as leveraging online platforms, partnering with local tourism organizations, and capitalizing on the town's appeal through compelling property descriptions and high-quality visuals, can help increase occupancy rates and maximize revenue potential.

Promote Arnolds Park as a versatile and family-friendly destination, highlighting its wide range of attractions and activities. The city's amusement park, bearing the same name, is a beloved landmark that draws families seeking thrills and entertainment. Emphasize the availability of rental properties within close proximity to the park, allowing guests to access the fun and excitement with ease.

Additionally, showcase the natural beauty of Lake Okoboji, positioning it as the heart of Arnolds Park's allure. Highlight various water-based activities, such as boating, swimming, paddleboarding, and fishing, to appeal to travelers seeking aquatic adventures. Mention the city's vibrant waterfront scene, featuring lakeside restaurants, live entertainment, and breathtaking sunset views.

You may also target young adults and highlight Arnolds Park's vibrant nightlife and entertainment scene. Showcase the availability of rentals that cater to this demographic, with proximity to popular bars, restaurants, and live music venues. Emphasize the opportunity for young adults to enjoy thrilling water rides, lively festivals, and a lively atmosphere that makes Arnolds Park an exciting summer destination.

Capitalize on the natural beauty of the area by creating an inviting outdoor space for guests to relax and enjoy the surroundings. Provide comfortable seating, outdoor dining areas, and possibly a grill for outdoor cooking. If possible, consider adding amenities like fire pits or outdoor games to enhance the outdoor experience and provide opportunities for guests to bond and create lasting memories.

Arnolds Park experiences peak demand during the summer months. Adjust your pricing strategy to reflect this seasonality and take advantage of the high demand periods. During the off-peak seasons, target a different demographic, such as nature lovers, by highlighting nearby hiking trails, fall foliage viewing spots, or winter activities like ice fishing or snowshoeing.

Arnolds Park, IA presents an attractive opportunity for investors in the Airbnb rental market, thanks to its location on the shores of Lake Okoboji and its popularity as a summer vacation destination for families and young adults. By emphasizing the area's natural beauty, range of recreational activities, and its appeal as a family-friendly or vibrant getaway, you can position your Arnolds Park rentals as sought-after accommodations for travelers seeking an unforgettable lakeside experience. With a promising ROI, substantial revenue potential, and a manageable market size, Arnolds Park is a wise choice for investors looking to capitalize on the Airbnb rental market.

2. Des Moines, IA

Des Moines, IA is a thriving city with a growing demand for short-term rentals due to its numerous festivals, events, and attractions such as the Iowa State Fair and the Des Moines Art Center. The city also boasts a strong economy and a diverse population, making it an attractive destination for both business and leisure travelers. Additionally, the affordable real estate prices make it an attractive location for investors looking to purchase properties for short-term rentals.

With affordable real estate prices and a large market size, investors can expect a healthy ROI of 9%. The ADR for Airbnb rentals in Des Moines is $91, with an occupancy rate of 66%, resulting in a revenue of $14k.

With a medium-sized market comprising 602 active Airbnbs, Des Moines strikes a balance between competition and opportunity. Investors can tap into a growing pool of travelers while still maintaining a manageable market presence. The high occupancy rate of 66% further underscores the demand for short-term rentals in the city, ensuring a steady stream of guests throughout the year.

Highlighting the city's attractions, such as the Pappajohn Sculpture Park, the Iowa State Capitol, and the East Village district, can contribute to the appeal of the properties and attract visitors looking to explore the local culture and attractions. Mention any major annual events, festivals, or concerts that take place in Des Moines, such as the Iowa State Fair or the World Food & Music Festival.

To effectively market Des Moines as a desirable Airbnb destination, highlight the city's attractions and unique offerings. Emphasize the vibrant downtown area with its thriving culinary scene, lively entertainment venues, and cultural attractions. Showcase the city's festivals, art galleries, and museums, appealing to tourists seeking enriching experiences.

Position Des Moines as a gateway to the great outdoors, promoting its expansive parks, trails, and recreational activities. Highlight the nearby Des Moines River and Gray's Lake, which offer opportunities for boating, fishing, and outdoor leisure. Target outdoor enthusiasts and nature lovers who seek a blend of urban amenities and natural beauty.

Differentiate your property by offering unique experiences or themed accommodations that cater to specific interests. For example, you could create a cozy and rustic farmhouse-style retreat or a modern urban loft experience. If your property has an outdoor area, invest in creating an inviting space for guests to relax and enjoy. Consider adding comfortable seating, a BBQ grill, and outdoor lighting to extend the usable space into the evenings.

By going the extra mile to exceed guest expectations, investors can foster positive guest reviews, repeat bookings, and word-of-mouth referrals. Collaborate with local businesses or tour operators to offer special packages or discounts to your guests, such as brewery tours, farm-to-table dining experiences, or outdoor adventure excursions.

Investors looking for a stable and profitable market should consider Des Moines. With a high occupancy rate and a large market size, there is plenty of opportunity for growth and success. The city's diverse population and strong economy also make it a desirable location for long-term rentals, providing investors with multiple streams of income.

3. Cedar Rapids, IA

Cedar Rapids, IA presents a good opportunity for investors interested in the Airbnb market. With its growing tourism industry and low cost of living, the city offers an attractive destination for travelers and a promising investment opportunity for those seeking profitable returns.

The projected ROI of 9% and annual revenue of $13,000 demonstrates the financial viability of investing in Cedar Rapids' Airbnb market. The ADR is currently at $101 with a 65% occupancy rate. As the city continues to attract visitors for various purposes, such as business, leisure, or attending local events, the demand for short-term accommodations remains strong. By capitalizing on this demand and providing well-maintained and well-furnished properties, investors can generate steady revenue and achieve favorable returns on their investment.

Cedar Rapids has 240 active Airbnb listings, providing investors with an opportunity to establish a competitive presence. The average Airbnb price in Cedar Rapids stands at $150,000, reflecting the affordability and diverse investment opportunities available in the market. Investors have the flexibility to curate a portfolio that caters to various traveler preferences and budgets, ranging from cozy apartments to spacious homes. This diversity allows investors to attract a wide range of guests, enhancing the potential for high occupancy rates and consistent revenue.

Emphasizing Cedar Rapids' attractions, such as the Czech Village, the Cedar Rapids Museum of Art, and the Indian Creek Nature Center, can enhance the appeal of the properties and attract visitors looking to explore the local culture and surroundings. Capitalize on Cedar Rapids' natural beauty and outdoor recreational opportunities, such as nearby hiking trails, parks, and rivers. Highlight these attractions and emphasize the convenience of your property's location for outdoor enthusiasts.

To succeed in the Cedar Rapids market, investors should prioritize providing a seamless and enjoyable guest experience. Provide amenities that cater to business travelers, such as a dedicated workspace, high-speed internet access, and easy access to transportation options. Emphasize the suitability of your property for families, offering features like cribs, high chairs, and games for kids.

Going the extra mile to provide local recommendations, personalized touches, and excellent customer service can further differentiate the property and create positive guest experiences. This could include providing a welcome basket with local treats or offering a guidebook with recommendations for dining, shopping, and attractions.

Cedar Rapids, IA stands as a top market for Airbnb investors due to its growing tourism industry and diverse attractions. The city's low cost of living and strong job market also make it an attractive location for long-term rentals, providing investors with a stable source of income.

4. Dubuque, IA

Dubuque, IA is another attractive market for Airbnb investors due to its growing tourism industry and unique attractions such as the National Mississippi River Museum and Aquarium and the historic Fenelon Place Elevator. The city also offers a variety of outdoor activities such as hiking and kayaking, making it a popular destination for nature enthusiasts.

With an occupancy rate of 56% and an average daily rate of $115, investors can expect a return on investment of 11%. The market size is considered small with 189 active Airbnb listings and an average Airbnb price of $158k. In 2020, the total revenue generated by Airbnb hosts in Dubuque was over $6 million, making it a promising market for investors looking to profit from the city's tourism industry.

Investors can capitalize on Dubuque's rich history and unique attractions to attract guests. Promote the city's downtown area, which is steeped in history and offers a range of cultural and entertainment experiences. Highlight the National Mississippi River Museum and Aquarium, a renowned destination that showcases the region's natural and cultural heritage. Additionally, emphasize the city's scenic beauty and outdoor recreational opportunities, such as hiking, biking, and boating along the Mississippi River. If your property is located near parks, trails, or riverfront access points, mention these features as they can be appealing to outdoor enthusiasts and nature lovers.

As part of the guest experience, offer recommendations for local dining establishments, shops, and attractions. Encourage guests to explore Dubuque's vibrant culinary scene, including its renowned farm-to-table restaurants and local breweries. Highlight nearby points of interest, such as Eagle Point Park and the Fenelon Place Elevator, to further enhance the guest experience and showcase the city's unique offerings.

Stay updated on the local event calendar and target travelers attending special events or festivals in Dubuque, such as the Dubuque Food and Wine Festival or the Dubuque Winter Farmers' Market. Adjust your pricing and availability accordingly to take advantage of peak demand during these events.

Investors who are interested in a market with a mix of urban and outdoor attractions would do well in Dubuque. The city's tourism industry is growing, and its unique attractions make it a popular destination for travelers. Additionally, the city's proximity to other popular Midwest destinations such as Chicago and Minneapolis make it a convenient stop for travelers looking to explore the region.

5. Clear Lake, IA

With its strong demand for vacation rentals and its close proximity to popular attractions like Clear Lake and the historic Surf Ballroom, Clear Lake offers a compelling investment opportunity. The city's appeal as a recreational destination, coupled with its growing popularity among tourists, ensures a steady flow of bookings and potential for long-term profitability.

The projected ROI of 9% and estimated annual revenue of $25,000 demonstrate the potential for attractive returns on investment in Clear Lake's Airbnb market. The ADR currently stands at $182, reflecting the value that guests are willing to pay for accommodations in the area. The city's natural beauty, water activities, and vibrant event scene contribute to a high demand for short-term accommodations, allowing hosts to capitalize on the growing tourism industry.

With an occupancy rate of 57%, investors can expect their Clear Lake properties to be in demand for a significant portion of the year. To optimize occupancy further, hosts can consider strategic marketing efforts, targeting visitors attending events at the Surf Ballroom or promoting the city's natural attractions during peak travel seasons.

The average Airbnb price of $276,000 reflects the value placed on properties in Clear Lake. As visitors seek memorable experiences and comfortable stays near the lake and Surf Ballroom, investing in well-maintained and attractively priced properties can yield higher occupancy rates and increased revenue.

Clear Lake's market size is classified as small, with 137 active Airbnb listings. This indicates a manageable market with room for growth and opportunities to stand out. By focusing on unique property features, appealing amenities, and exceptional guest experiences, investors can attract and retain a loyal customer base.

One of the key selling points of Clear Lake is its natural beauty and recreational opportunities. Highlight the pristine Clear Lake itself, which offers water-based activities like boating, fishing, and swimming. Promote the city's charming downtown area, known for its unique shops, restaurants, and live entertainment options. Additionally, emphasize the historical significance of the Surf Ballroom, a venue famous for hosting iconic music performances, including the last concert by Buddy Holly, Ritchie Valens, and the Big Bopper.

To succeed in the Clear Lake market, investors should focus on providing exceptional guest experiences. Decorate your property with lake-themed elements or nods to the city's rich musical history to enhance the overall guest experience. Forge partnerships with local businesses such as boat rental companies, water sports providers, and nearby restaurants to offer exclusive discounts or recommendations to your guests. By providing guests with valuable recommendations and connections to local services, you can enhance their overall experience and increase their satisfaction.

Additionally, leverage the local attractions and activities to provide recommendations for guests. Encourage them to explore the surrounding area, such as nearby state parks and trails for hiking and biking enthusiasts. Highlight seasonal events and festivals, such as the Clear Lake Fourth of July celebration or the Winter Dance Party, to attract visitors during specific periods.

Clear Lake, IA offers a promising investment opportunity in the Airbnb market, driven by its scenic lake, iconic Surf Ballroom, and growing popularity among tourists. With an attractive ROI, strong revenue potential, and a manageable market size, investors can capitalize on the city's demand for vacation rentals. By delivering exceptional guest experiences and highlighting the unique aspects of their properties, investors can thrive in this vibrant and rewarding market.

6. Davenport, IA

Situated on the picturesque Mississippi River and in close proximity to popular tourist attractions like the Figge Art Museum and the John Deere Pavilion, the city offers a promising investment potential. The city's scenic riverfront, vibrant arts scene, and industrial heritage attract a diverse range of travelers, creating ample opportunities for bookings and generating substantial earnings.

With a projected ROI of 7% and estimated annual revenue of $12,000, investing in Davenport's Airbnb market can yield favorable returns. Davenport's market size is categorized as small, with 108 active Airbnb listings. This indicates a manageable market with potential for growth and opportunities for hosts to differentiate themselves.

Davenport's average daily rate currently stands at $90, indicating an affordable and attractive pricing point for guests. The occupancy rate of 60% suggests a steady demand for short-term rentals in the city, creating a favorable environment for consistent revenue generation. To further optimize occupancy, hosts can leverage the city's event calendar, such as festivals, art exhibitions, and sporting events, to attract visitors seeking convenient and comfortable accommodations.

Davenport hosts various events and festivals throughout the year. Identify major events such as the Bix Beiderbecke Memorial Jazz Festival or the Quad City Air Show and adjust your pricing and availability to cater to attendees. Create event-specific packages or offer discounted rates for guests attending these events, providing added value and attracting a niche market of event-goers.

To maximize the potential of an Airbnb investment in Davenport, it is essential to highlight the city's unique attractions. Promote the Figge Art Museum, known for its impressive collection of artwork, and emphasize its cultural significance. Additionally, showcase the John Deere Pavilion, which showcases the legacy and innovation of the renowned agricultural equipment manufacturer, John Deere. Emphasize the convenience of proximity to these attractions, making it easier for guests to explore and experience the city's rich cultural offerings.

Davenport's location on the Mississippi River offers opportunities for various outdoor activities, including boating, fishing, and scenic riverfront walks. Emphasize these recreational options and highlight the natural beauty of the area to attract visitors who appreciate the outdoors.

Additionally, leverage the city's vibrant local dining scene and shopping districts, providing recommendations for guests to enjoy the culinary delights and unique retail experiences that Davenport has to offer.

To ensure success in the Davenport market, invest in creating an exceptional guest experience. Consider providing amenities such as a well-equipped kitchen, outdoor seating area, or a cozy reading nook to enhance the overall guest experience.

By capitalizing on Davenport's prime location, diverse attractions, and commitment to guest satisfaction, investors can tap into the city's growing tourism industry and generate profitable returns in the Airbnb market. With its unique blend of cultural offerings, outdoor activities, and riverside charm, Davenport promises a memorable stay for guests and a rewarding investment opportunity for those seeking to enter the short-term rental market.

7. Iowa City, IA

Iowa City’s large student population and the high demand for temporary housing during major events like football games and graduation ceremonies, the city offers a promising investment potential.

The projected ROI of 8% and estimated annual revenue of $13,000 demonstrate the financial viability of investing in Iowa City's Airbnb market. The average Airbnb price in the city is approximately $344,000. Despite being classified as a small market, Iowa City boasts 196 active Airbnb listings, providing investors with a chance to establish a competitive presence.

The market's ADR currently stands at $98, making it an affordable option for guests seeking temporary housing. The high occupancy rate of 71% indicates a strong demand for short-term rentals, particularly during major events and the academic calendar, ensuring a consistent flow of guests and revenue.

Iowa City is home to the University of Iowa, attracting a significant student population. It is essential to cater to the unique needs of the student population and capitalize on major events. Highlight the proximity of your property to the university campus, emphasizing convenience for students and their families. Consider offering amenities tailored to student needs, such as study areas, high-speed internet, and proximity to campus facilities like libraries and sports facilities.

During major events like graduation ceremonies, position your property as an ideal accommodation option for visiting families and friends. Highlight the property's amenities and its ability to comfortably accommodate groups, ensuring a memorable and convenient stay for guests attending these important milestones.

Consider offering extended stay options to accommodate guests who may require longer-term rentals. This can include discounted rates for weekly or monthly stays, providing a cost-effective solution for professionals, visiting professors, or families in transition.

Additionally, showcase the property's accessibility to Kinnick Stadium, the venue for the university's football games, and emphasize the convenience for sports enthusiasts.

To attract a consistent flow of guests year-round, consider marketing your property as a cozy retreat for visitors exploring Iowa City's cultural attractions. Promote the city's vibrant arts scene, including the Englert Theatre and the Riverside Theatre, and emphasize the property's proximity to these venues. Additionally, emphasize the city's charming downtown area, filled with unique shops, restaurants, and cafes, and highlight the property's convenience for guests looking to immerse themselves in the local culture.

To succeed in the Iowa City market, investors should prioritize a proactive and guest-centric approach. Providing a seamless booking experience, prompt communication, and personalized recommendations can enhance the overall guest satisfaction and lead to positive reviews, repeat bookings, and word-of-mouth referrals.

By capitalizing on Iowa City's large student population, the demand for temporary housing during major events, and the city's cultural attractions, investors can tap into a profitable short-term rental market. Offering a convenient and comfortable stay for guests, combined with attentive customer service, will help establish a strong presence and maximize returns in this vibrant and dynamic market.

8. Decorah, IA

Investing in Decorah, IA's short-term rental market presents a lucrative opportunity for investors. With its strong tourism industry and a range of popular attractions, such as the Vesterheim Norwegian-American Museum and the scenic Upper Iowa River, the city offers a promising investment potential.

The projected ROI of 8% and estimated annual revenue of $22,000 demonstrate the financial viability of investing in Decorah's Airbnb market. The average Airbnb price in the city is approximately $283,000. Decorah's market size is categorized as small, with 185 active Airbnb listings. This indicates a manageable market with room for growth and opportunities for investors to differentiate themselves.

The market's average daily rate currently stands at $134, reflecting the attractiveness of Decorah as a tourist destination and the willingness of guests to pay for quality accommodations. The occupancy rate of 58% highlights a strong demand for short-term rentals, providing investors with a consistent flow of guests throughout the year.

To get more bookings in Decorah, capitalize on the city's tourism industry and its unique attractions on your listings. Promote the town's attractions, such as the Vesterheim Norwegian-American Museum, which showcases Norwegian heritage and culture. Emphasize the museum's significance and proximity to your property, making it a convenient choice for tourists interested in exploring Decorah's cultural heritage. Highlight the scenic beauty of the Upper Iowa River and outdoor activities available, such as fishing, canoeing, and hiking. Showcase how your property's location provides easy access to these natural attractions.

Decorah attracts outdoor enthusiasts seeking nature and adventure. Equip your property with amenities that cater to their needs, such as secure storage for outdoor gear like bikes or fishing equipment. Provide information on nearby outdoor recreational areas, including maps, guides, and recommendations for hiking trails, fishing spots, or scenic drives. Offer extras like picnic baskets or outdoor seating to enhance guests' outdoor experiences.

Decorah is also known for its vibrant downtown area, filled with charming shops, restaurants, and cafes. Emphasize the convenience of your property's location for guests looking to explore the local culinary scene or indulge in retail therapy. Highlight the city's annual events and festivals, such as Nordic Fest, which attracts a significant number of visitors, and position your property as an ideal accommodation option for attendees.

With its blend of cultural experiences, outdoor adventures, and small-town charm, Decorah is an ideal destination for those seeking a lucrative investment in the Airbnb market. Offering a comfortable and memorable stay for guests, combined with exceptional customer service, will help establish a strong reputation and drive positive reviews and referrals.

Bottom Line

Investing in Iowa's Airbnb market can offer lucrative opportunities, provided you select the right market. Whether it's the summer appeal of Arnolds Park, the economic stability of Des Moines, or the tourism growth in Cedar Rapids, each market presents unique advantages. Understanding these markets in-depth will help you make informed decisions and maximize your return on investment.