Gulf Shores, AL, is a coastal town located in Baldwin County, known for its white sand beaches and clear blue waters. This small town has seen significant growth in its (Airbnb) short-term rental market in recent years, with investors flocking to the area to cash in on the vacation rental boom.
In this blog post, we will take a closer look at the current state of the (Airbnb) short-term rental market in Gulf Shores, AL, using data from Zillow, Chalet, and SmartAsset.
Market Overview
To understand the dynamics of the short-term rental market in Gulf Shores, let’s delve into some key statistics and figures.
Supply
The most popular homes are 3-bedroom homes, comprising 31.13% of inventory. This is followed by 2 and 4-bedroom homes at 28.27% and 18.27% of the total inventory, respectively.
Homes Appreciation
As of October 2024, according to Zillow, homes in Gulf Shores experienced an depreciation of -2.82%. This data indicates a significant decrease in property values.
Median Home Value
As of October of 2024, Homes in Gulf Shores have depreciated by -2.82%. The median home value in Gulf Shores is $466,700 as reported by Zillow. This figure highlights the city’s robust real estate market and the potential for long-term property appreciation.
Active Short Term Rentals
As of October 2024, Gulf Shores boasts a significant Airbnb rental market, with approximately 4,005 active rentals. This abundance of available properties provides ample opportunities for investors and homeowners looking to capitalize on the tourism demand.
Average Daily Rate
The median ADR for the market is $394.. The Average Daily Rate is the highest for 5 bedroom homes ($662) followed by 4-bedrooms and 3 bedrooms at $646 and $576 respectively.
Occupancy Rate
Chalet data reveals an occupancy rate of 51% for Airbnb rentals in Gulf Shores. This high demand ensures a consistent stream of income for property owners and investors.
How Profitable is Airbnb in Gulf Shores ?
As of October 2024, the average gross yield, which represents the annual income generated by a property as a percentage of its value, is 11.23% in Gulf Shores. This figure suggests that short-term rentals in the city offer a favorable return on investment. Gulf Shores is ranked #46 by return on investment on Airbnb rentals in the United States.
Annual Revenue
According to Chalet, short-term rentals in Gulf Shores earn an average of $30,766 annually, highlighting the strong investment potential in the city’s market. You can evaluate your properties using our free Airbnb calculator.
Property Tax
According to SmartAsset, the average property tax in Vail is 0.32%. This relatively moderate tax rate is an important consideration for those looking to invest in short-term rental properties.
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Regulations
Gulf Shores’s short-term rental regulations are somewhat investor-friendly, with different zoning regulations and limitations in place. Understanding these regulations is crucial for potential investors to ensure compliance and a smooth operation.
Median Household Income & Population
The median household income in Gulf Shores, AL, is $53,034. This is slightly lower than the national median household income of $70,784.
According to the United States Census Bureau, the population of Gulf Shores, AL, was 15,763. This number may vary depending on the season, as Gulf Shores, AL, is a popular vacation destination.
Hosts
The market is dominated by property management firms. The largest host is Vacasa Alabama with 4.54% of the total inventory and an average review of 4.53⭐️s .
Climate
Gulf Shores, AL, has a humid subtropical climate, with hot and humid summers and mild winters. The average temperature in the summer months is around 89 degrees Fahrenheit, while the average temperature in the winter months is around 58 degrees Fahrenheit.
Sports Teams & Colleges
Gulf Shores, AL, is home to several sports teams, including the Gulf Coast Texans, a minor league soccer team, and the Gulf Shores Dolphins, a high school football team.
There are no colleges or universities located in Gulf Shores, AL. However, there are several institutions of higher education located nearby, including the University of South Alabama and Faulkner State Community College.
Guests
The majority of the guests come from inside of Alabama. 2.80% of all guests are from Birmingham followed by New Orleans with 2.10%.
Crime Rate
According to NeighborhoodScout, Gulf Shores, AL, has a crime rate that is lower than 7% of all other cities in the United States. The overall crime rate in Gulf Shores, AL, is 32 crimes per 1,000 residents, which is higher than the national average.
Visitors & Tourist Attractions
Visitors to Gulf Shores, AL, come from all over the United States, with many coming from nearby states like Florida, Georgia, and Tennessee. Gulf Shores, AL, is also a popular destination for Canadian visitors.
According to the Gulf Shores and Orange Beach Tourism Board, Gulf Shores, AL, and its neighboring town of Orange Beach, AL, receive more than 6 million visitors each year.
Gulf Shores, AL, is home to several popular tourist attractions, including Gulf State Park, which offers miles of hiking and biking trails, fishing piers, and a golf course. Other popular attractions include the Alabama Gulf Coast Zoo, the Gulf Shores Public Beach, and the Gulf Shores Museum.
Peak Season
The peak season in Gulf Shores, AL, is typically during the summer months, from June to August. This is when the weather is at its warmest, and schools are out for summer break. However, Gulf Shores, AL, is also popular during the spring and fall, when the weather is milder and there are fewer crowds.
Conclusion
In conclusion, Gulf Shores, AL, is a growing short-term rental market with significant potential for investors. Despite the recent decrease in supply, the profitability of short-term rentals in the area remains high, with an average gross yield of 6.55%. The investor-friendly regulations and low property tax make Gulf Shores, AL, an attractive market for vacation rental investors. However, investors need to keep an eye on the changing market conditions and adjust their strategies accordingly. As the vacation rental market continues to evolve, those who stay ahead of the curve will be the most successful.
