Delaware 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 5 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 Delaware 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 1,182 Airbnb listings across the state of Delaware 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 5 cities in Delaware 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 5 STR Markets in Delaware
1. Lewes, DE
Lewes, DE, offers a thriving short-term rental market and is a top contender for real estate investors seeking good returns. This charming coastal town attracts tourists with its pristine beaches, historic architecture, and vibrant arts scene. As a vacation homes hotspot, Lewes entices visitors with attractions like Cape Henlopen State Park and events such as the annual Lewes Tulip Celebration. The area's strong tourism ensures consistent rental income for Airbnb hosts, making Lewes one of the best places for investment property and vacation rentals.
Key STR Metrics:
- Average Gross Yield: 8.1%
- Average Property Value: $880,346 (as of December 2024)
- Average Annual Revenue: $71,600 (past 12 months)
- Average Occupancy Rate: 36% (past 12 months)
- Qualifying Airbnbs: 248 (as of January 2025)
- Year-Over-Year Growth in Airbnbs: 83%
Find Airbnbs For Sale in Lewes, DE →
2. Ocean View, DE
Ocean View, DE, is a hidden gem for short-term rental investors seeking lucrative opportunities in the vacation homes market. This charming coastal town offers tourists an array of attractions, from pristine beaches to the serene James Farm Ecological Preserve. With vibrant seasonal events like the Bethany Beach Boardwalk Arts Festival nearby, guests are drawn to its unique charm. The strong demand for vacation rentals promises real estate investors a good return on investment, making it one of the best places for a profitable cash flow through Airbnb and other short-term rental properties.
Key STR Metrics:
- Average Gross Yield: 7.7%
- Average Property Value: $692,934 (as of December 2024)
- Average Annual Revenue: $53,168 (past 12 months)
- Average Occupancy Rate: 24% (past 12 months)
- Qualifying Airbnbs: 126 (as of January 2025)
- Year-Over-Year Growth in Airbnbs: 111%
Find Airbnbs For Sale in Ocean View, DE →
3. Wilmington, DE
Wilmington, DE, boasts a vibrant short-term rental market ideal for real estate investors seeking vacation homes and lucrative rental income. Home to attractions like the Brandywine Zoo and the historic Hagley Museum, Wilmington offers endless draw for tourists. Sports fans can enjoy Blue Rocks baseball games, while events such as the Clifford Brown Jazz Festival entice visitors year-round. With thriving tourism, Wilmington's housing market provides good return potential for Airbnb hosts seeking to tap into the bustling STR scene.
Key STR Metrics:
- Average Gross Yield: 7.4%
- Average Property Value: $484,682 (as of December 2024)
- Average Annual Revenue: $35,830 (past 12 months)
- Average Occupancy Rate: 44% (past 12 months)
- Qualifying Airbnbs: 96 (as of January 2025)
- Year-Over-Year Growth in Airbnbs: 66%
Find Airbnbs For Sale in Wilmington, DE →
4. Rehoboth Beach, DE
Rehoboth Beach, DE, a prime location in the short-term rental market, attracts tourists with its sandy beaches, lively boardwalk, and tax-free shopping. This coastal town's vibrant housing market offers lucrative opportunities for real estate investors seeking vacation homes and investment property. Seasonal attractions, such as the Rehoboth Beach Jazz Festival and Sea Witch Festival, draw substantial visitor numbers, enhancing rental income potential for Airbnb hosts. The area promises good returns and positive cash flow for those in real estate investing.
Key STR Metrics:
- Average Gross Yield: 5.9%
- Average Property Value: $1,545,355 (as of December 2024)
- Average Annual Revenue: $90,398 (past 12 months)
- Average Occupancy Rate: 34% (past 12 months)
- Qualifying Airbnbs: 566 (as of January 2025)
- Year-Over-Year Growth in Airbnbs: 86%
Find Airbnbs For Sale in Rehoboth Beach, DE →
5. Bethany Beach, DE
Bethany Beach, DE, is a gem in the short-term rental market and a dream for real estate investors seeking vacation homes. This charming coastal town boasts stunning beaches and attractions like the Bethany Beach Boardwalk and Nature Center. The vibrant calendar includes the annual Bethany Beach Jazz Funeral and Seaside Craft Show, drawing tourists year-round. With prime real estate investing opportunities and high rental income potential, investors find the housing market conducive to good returns and cash flow, perfect for Airbnb hosts catering to guests seeking relaxation and local charm.
Key STR Metrics:
- Average Gross Yield: 5.6%
- Average Property Value: $1,563,045 (as of December 2024)
- Average Annual Revenue: $87,721 (past 12 months)
- Average Occupancy Rate: 15% (past 12 months)
- Qualifying Airbnbs: 146 (as of January 2025)
- Year-Over-Year Growth in Airbnbs: 144%
