I’m not going to sugarcoat this. Things have changed in the short-term rental world.
The BiggerPockets Pulse survey just dropped, where we spoke to over 600 BP members about their investing strategies and thoughts about 2026. More than half the investors we spoke to now believe long-term rentals are the best strategy heading into 2026.
Short-term rental sentiment? Notably lower. At the same time, the majority of investors still plan to grow their portfolios over the next 12 months.
If you’re reading those tea leaves, it looks like people are tired. Rates are still elevated. Home prices feel uncertain. The easy-money days are gone.
After a few years of being sold the dream of “passive income” through short-term rentals, many operators are quietly admitting they never signed up to run an actual business. So they’re pivoting to long-term rentals because it feels simpler, calmer, and frankly, less exhausting.
I get it. I really do.
But here’s what nobody’s talking about: The investors bailing on short-term rentals right now aren’t the ones who treated it like a business in the first place. They’re the ones who thought they could post some iPhone photos on Airbnb, set the calendar to auto-price, and collect checks while sipping margaritas.
That version of short-term rentals never existed. And 2026 is the year the market finally stopped pretending it did.
For those of us still in the game, we’re looking at a great opportunity.
The Part Where I Got Honest With Myself
Here’s what the survey data is actually telling us. Everyone sees that long-term rentals are polling higher and short-term rentals are cooling off, and they’re interpreting that as a directional signal: “LTRs are safer, STRs are riskier, so follow the herd.” But what that data really means is that competition in short-term rentals is about to thin out dramatically.
When half the market decides a strategy is too hard or too risky, they don’t just slow down. They exit, sell, convert properties, and stop buying new ones.
And that creates exactly the kind of environment where disciplined operators can find deals that pencil beautifully because sellers are motivated and buyers are spooked.
This is how opportunities actually work in real estate. They don’t announce themselves with fireworks and champagne. They show up disguised as problems that scare off the casual money. Right now, long-term rentals are always popular, but they’re experiencing an even bigger lift because they feel safe and predictable.
This means the short-term rental market is about to see fewer people chasing the same listings, and fewer operators willing to bid up on quality assets. If you’re not afraid to operate a hospitality business, 2026 might be one of the best years to acquire short-term rental properties we’ve seen in half a decade.
I run 20 short-term rentals across Texas, mostly within an hour of Houston and Austin. Some are big, generic houses in suburban neighborhoods. Others are weird, wonderful properties like geodesic domes and mirror houses near regional attractions.
Here’s the difference: My generic houses generate about $2,000 in cash flow per month because I self-manage them. If I handed them off to a property manager? We’d be at breakeven, maybe slightly negative after fees.
My unique builds? They’re crushing it with high occupancy, premium rates, and repeat guests. But they only work because I built a team around them, such as virtual assistants, cleaners, and a maintenance crew.
That didn’t happen overnight. It took three years of grinding before I realized I was spending my evenings answering guest messages during dinner and literally driving across town to drop off tissue boxes instead of building systems.
There was a breaking point where I had to choose: Work in the business, or work on the business.
Most STR operators are still working in it. And that’s why they’re exhausted.
What I’m Seeing Right Now
I know investors with three or four houses near Lake Travis or outside Austin who are struggling. Their occupancy is down to 40%, maybe 50% if they’re lucky.
And when I review their listings, it’s clear why. They haven’t updated their photos in two years, using the same generic furniture from 2022. Their pricing strategy is “set it and forget it.” They’re not reinvesting in the property or building systems. They think they can just coast because “It’s Airbnb, people will book it.”
No. They won’t.
The market has matured. Guests are pickier. They’ve stayed in hundreds of places by now, and they know what good looks like.
If your property is just another beige three-bed/two-bath in a random neighborhood with no unique selling point, you’re competing on price. And in a saturated market, that’s a race to the bottom.
That’s why I shifted my entire strategy. I’m only buying large homes with a unique feature (think pool, lakefront, something memorable) or unique couples’ cabins with private amenities. Those are the properties people are actively searching for and booking in 2026.
The cookie-cutter suburban rental? It’s done.
The Skills You Didn’t Know You Were Building
When you run a successful STR, you’re learning:
- Pricing based on real-time demand, not fixed annual leases
- Systems for cleaning, maintenance, and guest turnovers
- Customer experience and reputation management
- Team building and delegation
- Ongoing asset optimization instead of passive holding
You might not realize it, but these are professional operator skills you’d find in the upper ranks of a prestigious hotel chain. Once you have them, real estate is just that much easier. It also opens the door to other assets like boutique hotels, RV parks, campgrounds, mixed-use hospitality assets, and small commercial properties with operating components.
Long-term rentals teach you patience and discipline. Short-term rentals teach you how to run a business. Historically, that’s where disproportionate wealth is created in real estate.
I didn’t start out thinking this way. I thought I was just buying houses and listing them online. But after three years of doing this, I realized I was building a hospitality business that used real estate as the vehicle.
That’s a completely different game. And it’s a much better one if you’re willing to play it.
The Chaos Actually Protects You
One of the most common criticisms I hear about short-term rentals is that they’re “too chaotic.” And yeah, compared to a long-term rental where the tenant calls you twice a year, STRs feel like you’re running a 24/7 customer service operation.
But here’s what that chaos actually gives you: early detection.
My properties are inspected by cleaners or maintenance staff every few days. If there’s a leak, we catch it before it becomes a $10,000 mold remediation. If the HVAC is making an unusual noise, we fix it before it fails in the middle of summer with guests inside. And if the deck board is loose, we replace it before someone twists an ankle and we’re dealing with insurance claims.
Long-term rentals feel calm because you’re not seeing the problems. They’re just accumulating quietly in the background. Then one day, your tenant moves out, and you discover the water heater has been leaking for six months, the HVAC hasn’t been serviced in three years, and there’s a mystery stain on the ceiling you’re afraid to investigate.
A typical long-term rental might generate a few hundred dollars in cash flow per month. That works great until a single repair wipes out an entire year of profit. STRs generate higher gross revenue, but they also force you to stay on top of maintenance.
In essence, STRs teach (force) you to be proactive.
The Tax Advantage Nobody Talks About Enough
I’m not a CPA, and you should talk to yours. But in many cases, short-term rentals qualify for accelerated depreciation without requiring real estate professional status.
When structured correctly, this means you can combine meaningful cash flow with aggressive depreciation, often offsetting active income and freeing up capital for reinvestment. In an environment where appreciation is uncertain and rates are elevated, that flexibility matters more than headline returns.
This isn’t about gaming the system. It’s about understanding that operating real estate is treated differently from passive ownership. And if you’re willing to treat your STRs like a business, the tax code rewards you for it.
Long-term rentals can also use depreciation, obviously. But the ability to actively participate in your STR business and unlock those benefits without needing to hit 750+ hours in real estate to qualify for Real Estate Professional Status (REPS) with the IRS? That’s a meaningful advantage for many investors.
Why Low Sentiment Might Be the Best News You’ll Hear All Year
The BiggerPockets survey shows uncertainty about home prices, mixed expectations for rates, and a general sense of caution heading into 2026. Those conditions don’t reward hype. They reward competence.
When sentiment drops, weaker operators exit. They sell their properties, convert them to long-term rentals, or leave them half-empty while they determine what to do. Competition thins. Quality assets become easier to identify. Pricing power shifts back to the investors who actually understand their numbers and operations.
Short-term rentals don’t disappear in down cycles. They consolidate. And consolidation has always favored disciplined operators over casual participants.
This is the environment where I’m taking my biggest swings. I’m pursuing larger projects: homes that offer something you can’t find anywhere else, couples’ cabins with private hot tubs and fire pits—properties that create memories, not just a place to sleep.
Because here’s what I know: The investors who are serious about this aren’t going anywhere. They’re getting better, building teams, reinvesting in their properties, and treating this like the business it always was. And when the market eventually recovers, they’re going to be the ones who dominate.
The Real Question You Should Be Asking
Short-term rentals aren’t for everyone. They never were.
But if you’re reading this and are undecided, the question isn’t “Should I do STRs or long-term rentals?” The question is: “Am I willing to build a business, or do I just want to own real estate?”
If the answer is the latter, long-term rentals are great. They’re stable, predictable, and low-drama. There’s absolutely nothing wrong with that path.
But if the answer is the former, short-term rentals remain one of the fastest ways to build cash flow, develop transferable skills, unlock meaningful tax advantages, and eventually move into larger commercial assets.
Low sentiment doesn’t mean the strategy is broken. Sometimes it just means the people who misunderstood it have finally left.
And for the rest of us? That’s when things get interesting.
