Connecticut is home to many thriving short-term rental markets, but identifying the top-performing cities can be overwhelming, especially when combing through data from countless locations across the state.
To simplify this process, we analyzed data from markets statewide and compiled a list of the top 4 cities for investors and landlords seeking potentially high-return rental properties in the coming year.
As always, we recommend thorough underwriting and analysis of any prospective property and a review of local short-term rental regulations before making any investment decisions.
How We Created This List
First, we looked at all Airbnb listings in Connecticut that met the following criteria as of January 2025:
- Average Rating: 4.8 stars and above
- Guest Review Count: Minimum of 10
- Average Daily Rate: $1 (minimum) to $2,000 (maximum)
- Occupancy Rate: 1% (minimum) to 99% (maximum)
- Property Size: 1 to 10 bedrooms
- Property Type: Entire homes
We did this to eliminate Airbnb listings from our analysis that fall outside of what we consider "realistic" situations. This left us with a total of 420 Airbnb listings across the state of Connecticut to work with.
Next, we grouped these listings by city and eliminated markets that didn't have at least 75 Airbnb listings meeting the above criteria. We took this step to avoid outlier cities we felt didn't have enough data to be considered at this current time. This left us with 4 cities in Connecticut to rank.
Then, we needed to arrive at a gross yield number for each of our remaining cities in order to create our rankings. We did this by taking the average annual Airbnb revenue for each city and combining it with the cities median property value (from Zillow as of December 2024) to calculate our gross yield for each city.
Finally, we ordered the cities by highest gross yield.
The Top 4 STR Markets in Connecticut
1. Milford, CT
Milford, CT, is a charming coastal town perfect for short-term rental properties. Popular among tourists, its main attractions include Silver Sands State Park, historic downtown, and the annual Oyster Festival. With a vibrant housing market and growing tourism scene, Milford promises a good return for real estate investors. The town also supports a rich calendar of seasonal events, appealing to potential Airbnb hosts seeking rental income. Its location, just 90 minutes from NYC, enhances its appeal as a top vacation rental market for visitors looking for a peaceful yet engaging escape.
Key STR Metrics:
- Average Gross Yield: 9.2%
- Average Property Value: $641,551 (as of December 2024)
- Average Annual Revenue: $58,947 (past 12 months)
- Average Occupancy Rate: 47% (past 12 months)
- Qualifying Airbnbs: 121 (as of January 2025)
- Year-Over-Year Growth in Airbnbs: 59%
Find Airbnbs For Sale in Milford, CT →
2. New Haven, CT
New Haven, CT, renowned for its vibrant arts scene and historic charm, is a prime location for short-term rental properties. Home to Yale University, it's a hub for cultural tourism, attracting visitors to theaters, museums, and regular events like the International Festival of Arts & Ideas. Sports enthusiasts flock to see Yale's sports teams, making this city a hot spot for vacation rentals. For real estate investors, the city's robust housing market offers good returns and rental income potential, making New Haven one of the best places for real estate investing in 2025.
Key STR Metrics:
- Average Gross Yield: 8.2%
- Average Property Value: $450,138 (as of December 2024)
- Average Annual Revenue: $36,986 (past 12 months)
- Average Occupancy Rate: 41% (past 12 months)
- Qualifying Airbnbs: 141 (as of January 2025)
- Year-Over-Year Growth in Airbnbs: 76%
Find Airbnbs For Sale in New Haven, CT →
3. Stonington, CT
Stonington, CT offers a prime spot for short-term rental investments with its charming coastal vibe and numerous attractions. Known for its scenic beaches, historic sites, and the iconic Stonington Borough, this area attracts tourists year-round. The popular Mystic Aquarium and Mystic Seaport Museum are just minutes away, enhancing its tourism appeal. With vibrant events like the Stonington Vineyards Summer Wine Festival and classic New England sports leagues, real estate investors can enjoy reliable rental income. Stonington is truly one of the best places for a vacation rental property.
Key STR Metrics:
- Average Gross Yield: 8.1%
- Average Property Value: $940,781 (as of December 2024)
- Average Annual Revenue: $75,950 (past 12 months)
- Average Occupancy Rate: 38% (past 12 months)
- Qualifying Airbnbs: 75 (as of January 2025)
- Year-Over-Year Growth in Airbnbs: 87%
Find Airbnbs For Sale in Stonington, CT →
4. Stamford, CT
Stamford, CT, offers a vibrant short-term rental market ideal for real estate investors seeking good return. With attractions like the Stamford Museum & Nature Center and Mill River Park, it's perfect for vacation homes or Airbnb properties. Visitors enjoy sports events from the Stamford Sharks and annual festivities like the Alive@Five concert series. As a hotspot for tourism, this dynamic housing market promises steady rental income, making it one of the best places for vacation rentals in 2025.
Key STR Metrics:
- Average Gross Yield: 5.1%
- Average Property Value: $1,018,526 (as of December 2024)
- Average Annual Revenue: $52,316 (past 12 months)
- Average Occupancy Rate: 46% (past 12 months)
- Qualifying Airbnbs: 83 (as of January 2025)
- Year-Over-Year Growth in Airbnbs: 78%