Palacios, TX Airbnb Market Data, Statistics, and Occupancy Rates

Palacios Short-Term Rental Market Overview

Palacios is a small coastal market on Texas's Matagorda Bay with just 21 active Airbnb listings, making it one of the more niche STR opportunities in the state. Average annual revenue sits at $20,058, supported by a pronounced summer peak that sees monthly earnings climb near $3,000 in July. While occupancy at 22% trails the Texas state average of 33%, the market's 74% year-over-year listing growth signals rising investor attention and growing traveler interest in this Gulf Coast fishing town.

Key Market Statistics

According to Rabbu market data, the Palacios short-term rental market shows:

Data sources: Rabbu proprietary analytics as of Apr, 27 2026 and Zillow Home Value Index (ZHVI) as of Apr, 27 2026.

Why Investors Consider Palacios

Palacios appeals to investors looking for an affordable Gulf Coast entry point with above-average market growth, though selective deal sourcing is essential given competitive dynamics and softer occupancy.

Expert Market Assessment

"Palacios represents a competitive but emerging opportunity for STR investors willing to navigate seasonal swings. Revenue is heavily concentrated in the summer months — July alone generates roughly four times the revenue of December — meaning cash-flow planning around the off-season is critical. The market's above-average growth trend is encouraging, but below-average occupancy stability at 22% (versus 33% statewide) means investors need to price aggressively and optimize listings to stand out in an increasingly crowded field. Properties that lean into the coastal lifestyle with outdoor amenities and waterfront positioning are best positioned to capture demand."

— Rabbu Market Analysis Team

Key Airbnb Metrics & Trends in Palacios

Average revenue by month in Palacios

Revenue in Palacios follows a sharp seasonal curve, peaking in July at $2,958 and bottoming out in December at $678 — a spread of over 4x. Investors should expect the June–August window to generate roughly 40% of annual income, with a secondary bump in March ($2,088) and October ($2,034) suggesting spring break and fall fishing season contribute meaningfully.

Active Airbnb listings by property size in Palacios

The entire reportable supply in Palacios consists of 1-bedroom properties, with 10 active listings in that category. This concentration suggests an opportunity for investors willing to bring larger, differentiated properties — such as 2- or 3-bedroom homes — to a market with virtually no competition at those sizes.

Average daily rate (ADR) by property size in Palacios

One-bedroom listings in Palacios command an ADR of $138, well below the market-wide average of $198, which indicates that the higher overall ADR is being driven by unlisted or less common property types. For investors focused on 1-bedroom units, the $138 rate sets a realistic pricing baseline.

Average RevPAN by property size in Palacios

One-bedroom properties generate a RevPAN of just $21, reflecting the combination of a modest $138 ADR and a 16% occupancy rate. This low RevPAN highlights the challenge of consistent booking volume in smaller units and suggests that revenue optimization through pricing and listing quality improvements is essential.

Average occupancy rates by property size in Palacios

One-bedroom listings in Palacios average only 16% occupancy, significantly below the market-wide 22% figure. This gap suggests that smaller units face stiffer competition for bookings, and investors in this segment should focus on standout amenities and competitive pricing to improve fill rates.

Average monthly revenue by property size in Palacios

One-bedroom units earn an average of $1,123 per month, about $550 less than the overall market average of $1,671. This shortfall underscores that larger or more premium property types in the market — though not individually tracked due to small sample sizes — are likely pulling up the overall revenue figures.

Average annual revenue by property size in Palacios

At $13,478 in average annual revenue, 1-bedroom properties in Palacios deliver modest returns that may challenge profitability depending on acquisition cost and operating expenses. Investors eyeing higher yield potential may want to explore larger property configurations where competition is currently nonexistent.

Most common amenities for Airbnb listings in Palacios

Parking is universal across Palacios listings (100%), followed by patio or balcony (86%), kitchen (81%), and backyard (76%) — signaling that outdoor living and self-sufficiency are baseline guest expectations in this coastal market. Pet-friendliness (76%) and BBQ grills (71%) are also prevalent, while waterfront access (38%) and beach access (24%) serve as premium differentiators that could command higher rates.

Understanding Palacios's ROI Score: 45/100

Rabbu's ROI Score is a proprietary metric that evaluates short-term rental investment potential based on multiple factors.

How the ROI Score is Calculated

What This Means for Investors

Palacios earns a 45 out of 100 on Rabbu's ROI Score, placing it in the Competitive Opportunity band — meaning the market has real potential but requires more selective deal sourcing to generate strong returns. The revenue-to-price ratio and supply/demand balance are average, while occupancy stability scores below average at just 22%, offset somewhat by above-average market growth driven by a 74% year-over-year increase in listings. Pairing this data with thorough local regulatory research and a clear strategy for managing seasonal cash-flow gaps will be key to making an investment here pencil out.

Short-Term Rental Regulations in Palacios

Understanding local STR regulations is essential before investing in Palacios. Here's the current regulatory landscape:

Permit Requirements

Short-term rental operators in Palacios, Texas may need to obtain permits or register their property with local authorities before listing. Investors should verify current requirements with the City of Palacios and Matagorda County, as rules in smaller Texas municipalities can vary.

Key Restrictions

Common restrictions that may apply include occupancy limits, noise ordinances, parking requirements, and minimum-stay rules. HOA covenants in certain neighborhoods could also limit or prohibit short-term rentals, so reviewing deed restrictions before purchasing is important.

Tax Obligations

Texas requires short-term rental operators to collect and remit state hotel occupancy tax, and local jurisdictions may impose additional lodging or tourism taxes. Major booking platforms typically handle tax collection on behalf of hosts, but operators should confirm compliance with both state and local requirements.

Regulations subject to change. Always verify with local authorities before purchasing. A Rabbu partner agent specializing in Palacios can provide current regulatory guidance.

Future Outlook & Long-Term Forecast

"Over the next 12–18 months, Palacios is likely to see continued supply growth as investor interest pushes new listings into this small market. Seasonal patterns suggest summer months will remain the revenue engine, with July and June driving the bulk of annual earnings. ADR could inch upward in the range of 2–5% if demand keeps pace with supply growth, though occupancy may stay in the low-to-mid 20s unless the market attracts more consistent off-season visitors. Investors should plan conservatively around winter months, when revenue can dip below $700."

— Rabbu Market Analysis Team

Frequently asked questions about Airbnb in Palacios, TX

What is the average Airbnb occupancy rate in Palacios?

The average Airbnb occupancy rate in Palacios is currently 22%, which falls below the Texas state average of 33%. This reflects the market's strong seasonality — summer months drive the majority of bookings while winter months see significantly lower demand. Investors should factor this occupancy level into their financial projections and consider strategies like competitive pricing and extended-stay discounts during off-peak periods to improve fill rates.

How much do Airbnb hosts make in Palacios?

Airbnb hosts in Palacios earn an average of $1,671 per month and approximately $20,058 per year based on trailing 12-month performance. Revenue varies significantly by season, with July being the strongest month at roughly $2,958 and December the softest at around $678. Individual results depend on property quality, location relative to the waterfront, pricing strategy, and how well the listing is optimized with in-demand amenities.

Is Palacios a good market for Airbnb investment?

Palacios scores a 45 out of 100 on Rabbu's ROI Score, placing it in the 'Competitive Opportunity' category. The market shows above-average growth with a 74% year-over-year increase in active listings, but occupancy stability is below average and the revenue-to-price ratio is moderate. Investors who source deals carefully — particularly waterfront or near-waterfront properties — and manage seasonal cash-flow gaps effectively can find viable returns in this small Gulf Coast market.

What is the average daily rate (ADR) for Airbnb in Palacios?

The average daily rate for Airbnb listings in Palacios is $198, which is below the Texas state average of $276. For 1-bedroom properties specifically, the ADR drops to $138. The lower rate reflects the market's smaller, more budget-oriented property mix and its position as a quieter coastal destination compared to larger Texas beach markets.

Are short-term rentals legal in Palacios?

Short-term rentals are generally permitted in Palacios, Texas, though operators may need to comply with local registration or permitting requirements. As regulations can change, investors should check directly with the City of Palacios and review any applicable HOA or deed restrictions before purchasing. Texas state hotel occupancy tax obligations also apply to STR operators.

When is peak season for Airbnb in Palacios?

Peak season in Palacios runs from late spring through summer, with July being the highest-earning month at an average of $2,958 in revenue. June ($2,545) and March ($2,088) also perform well, likely driven by spring break travel and early summer vacationers. The slowest months are December ($678) and January ($758), making the winter period the off-season for this coastal market.

How many Airbnbs are there in Palacios?

As of April 2026, there are 21 active Airbnb listings in Palacios. This represents a 74% increase year over year, indicating rapid growth in this small market. The limited supply base means the market is still developing, which can be both an opportunity for early movers and a risk if new supply outpaces demand growth.

How is Airbnb revenue calculated in Palacios?

The annual and monthly revenue figures for Palacios are derived from the trailing 12 months of historical booking performance for active comparable Airbnb listings in the market — they are not forward-looking projections. Rabbu averages each comparable listing's actual revenue per available night (RevPAN) by month over the past year, removes regional outliers, and rolls the results up to a market-level historical average. This approach anchors the figures to what hosts have actually earned recently while naturally reflecting seasonal peaks and slower months, since each month uses its own historical performance data. Individual results can vary based on property quality, pricing strategy, and operational management.

About Rabbu Market Data

Rabbu provides Airbnb and short-term rental market data and statistics across the United States. Our mission is to empower investors with accurate insights and easy-to-use tools, so they can confidently identify and act on the best opportunities in the Airbnb market.

What this data includes

• Regularly updated active Airbnb and STR listing counts for the Palacios market
• Average daily rate, occupancy, and RevPAN metrics based on current and trailing performance
• Monthly and annual revenue figures derived from 12-month trailing booking data
• Property size breakdowns for supply, pricing, occupancy, and revenue where available
• Home value estimates sourced from the Zillow Home Value Index (ZHVI)

Sources and disclaimers

Rabbu proprietary analytics as of Apr, 27 2026 and Zillow Home Value Index (ZHVI) as of Apr, 27 2026. Revenue projections are estimates based on comparable properties and do not guarantee future performance. Data reflects trailing 12-month performance and may not capture very recent market shifts. Local regulations, HOA rules, and tax obligations vary and should be independently verified before investing.