Looking for a rental investment? This historic IL town was ranked a top pick in US

Aaron Mudd
·2 min read
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A small town in northwest Illinois – known for its picturesque 19th century architecture and as the one-time residence of 18th President Ulysses S. Grant – is among the top places for investors interested in the short-term rental scene.

Analytics company AirDNA ranked Galena ninth on its list of the top 25 “Best Places to Invest in Vacation Rentals in 2021 & 2022.”

AirDNA, which scraped data from booking platforms such as Airbnb and Vrbo, created what it called its “updated index of the best markets for investment in the coming year.”

Measuring local rental demand, revenue growth and investment cost versus yield, AirDNA ranked Galena ninth on the list, just below Charleston, S.C., and just above Southwest Harbor, Maine.

“During the summer months, regional travelers vacation in cabins near Lake Galena or stay downtown in historic 19th-century buildings,” AirDNA said. “This opens up a profitable opportunity.”

Galena got a score of 100, the highest possible, for “investability.”

That metric essentially compares the expected income of a property relative to the cost of purchasing it. AirDNA calculates this by using average revenue potential of homes in the area, subtracting the average cost for operating the property and dividing that number by the typical home value in the same area for comparable homes.

Galena got an overall investor score of 80 from AirDNA.

According to AirDNA, the typical home value in Galena is $215,000, with a typical short-term rental occupancy rate of 60%, an average daily rate of $371 and average annual revenue of $67,000.

St. Louis Metropolitan area ranks 24th on list

A Missouri location also made the list of top investment locales.

AirDNA put St. Louis at 24th on its list given the low financial barriers for buying rental property.

Typical home values there are $212,000, with an average annual revenue of $35,000.

The area is also seeing good revenue growth, earning a high score of 86 from AirDNA. It’s overall investor score was 71.

Best short-term rental markets in 2022

Here’s AirDNA’s top 10 picks:

  1. Maui, Hawaii

  2. Kenai Peninsula, Alaska

  3. Chattanooga, Tenn.

  4. Gulfport/Biloxi, Miss.

  5. Slidell, La.

  6. Crystal River, Fla.

  7. Joshua Tree, Calif.

  8. Charleston, S.C.

  9. Galena, Ill.

  10. Southwest Harbor, Maine