2026 Short-Term Rental Investment Outlook: Why the Timing Is Right for Denver Owners

2026 Short-Term Rental Investment Outlook: A Turning Point for Denver?

Stepping into 2026, the Denver short-term rental market is set to grab the spotlight—a trend backed up by new analysis from AirDNA, a leader in short-term rental data. For property owners here in the Front Range, these findings carry important implications. With Denver’s unique blend of urban energy and Rocky Mountain adventures, investors stand to see real advantages as national trends help shape local opportunities. This year, the air is filled with optimism for those who know when to act and how the market is changing.

Key Findings From AirDNA’s 2026 Outlook

AirDNA’s annual report identifies several market shifts that matter to investors. After a few unpredictable years, the report points to cooler home prices, steadier short-term rental revenue, continued robust travel spending, and a more gradual increase in available listings. What does this mean for Denver owners? Fundamentally, it signals a friendlier environment than seen since before the pandemic-era frenzy.

According to AirDNA, U.S. short-term rental occupancy should adjust by just 1% in 2026—a minor change reflecting better balance between supply and demand. Available listings are projected to climb by only 4.6%, a marked slowdown compared to the dramatic 20% surges experienced during 2021 and 2022. Tax incentives designed to encourage property owners, especially programs like the new Big Beautiful Bill, are expected to spur a new wave of listings. As a result, supply will begin growing faster as the year progresses, but not nearly on the scale previously seen.

Meanwhile, average daily rates (ADR) should rise modestly—by about 1.5% for 2026—with expectations of even faster increases in 2027. That steadying pattern stands in stark contrast to the volatility seen in recent years, offering owners much-needed predictability as they map out their income potential.

Earning Power: STR Premium Reaches a High Point

One of the biggest confidence boosters in AirDNA’s analysis is the strengthening “STR Premium.” This metric tracks how earnings from short-term rentals stack up against ownership and operating costs, and it’s now reaching the highest point since 2022. For local property owners who sat on the sidelines due to economic uncertainty, this is the clearest sign in years that short-term rentals are once again a solid bet—especially in high-demand neighborhoods like RiNo, LoDo, and the Cherry Creek corridor, as well as mountain-adjacent properties to the west.

Importantly, overall revenue indicators have stabilized. The market is no longer swinging back and forth as it did in the years right after the pandemic. Instead, a return to predictable, steady growth is emerging, making the case for new investments and upgrades to existing rentals just a little less daunting.

Denver in Context: Geography Matters in 2026

AirDNA’s experts put a spotlight on certain types of markets, and Denver falls right into the sweet spot. Coastal, mountain, and suburban areas are noted for their strong outlook—and Denver, with its prime location at the foothills, bridges both mountain access and big-city appeal. Walk down Larimer Street or look out over Sloan’s Lake; the buzz of travelers—from workcationers to families on adventure breaks—is hard to miss. Small wonder, then, that demand is expected to remain resilient throughout 2026 and beyond.

While listing growth is increasing more slowly, demand-side factors are a bigger story locally. After a softer year in 2025, indicators show bookings on the upswing again for 2026. Much of this can be traced to broader travel trends, but Denver’s unique ability to attract both urban explorers and nature-lovers gives local owners a consistent edge. This year, expect traditional high season to stretch further, especially with the city’s annual festivals, big-event weekends, and its role as a gateway to the Rockies.

Special Demand Drivers: The World Cup Effect

Nationally, the 2026 FIFA World Cup looms large. A handful of U.S. host cities are already showing above-normal booking activity, with projected revenue per available room (RevPAR) bumps ranging from about 5.5% to over 6%. While Denver itself isn’t on the official host list, the ripple effects will still be felt. Savvy owners are already planning for spillover demand from regional fans, event-related stays, and international visitors looking for centrally located launches to see the tournament in person.

It’s worth asking: Will you be ready when guests start searching for places to stay within driving distance of the action? Properties that are well managed, professionally cleaned, and tailored for groups or families are likely to catch that extra wave of demand.

Strategies for Denver Owners: Making the Most of Market Momentum

So, how should local property owners respond as these national trends unfold? The evidence points to a few clear strategies:

• Keep a close pulse on occupancy trends and seasonal pricing, adjusting nightly rates ahead of key events like music festivals, conventions, and major sports games.
• Ensure your property stands out with professional listing photos, accurate descriptions, and a seamless booking process—essentials that directly impact occupancy and profitability.
• Stay on top of changing tax incentives and regulatory shifts, especially as Colorado and Denver authorities refine short-term rental legislation.

Consider, for example, the owner of a Sunnyside duplex who updated their unit’s décor and invested in digital check-in tools before the 2025-26 peak season. Not only did occupancy jump by 10%, but positive reviews multiplied, drawing in guests from as far away as Austin and San Diego. For those willing to adapt, the path to higher, more stable revenue has never been clearer.

A Word on Supply: Listing Growth Without Overheating

Some investors worry that increased listings could undercut revenue, but the 2026 forecast suggests these fears may be overblown—at least in well-diversified markets like Denver. Unlike the explosive growth seen during the early recovery years, the coming expansion will be steadier and more responsive to actual demand. With market balance in mind, owners who maintain standout properties and offer reliable guest experiences should face minimal downside from moderate new competition.

Why is this the case? Denver’s visitor base is robust, and the range of rental stock—from Capitol Hill condos to homes near Red Rocks—gives guests an ever-widening array of choices. Success in 2026 will be about quality over quantity. Reliable maintenance, timely communication, and strategic amenities will be what set your property apart. It’s less about racing to be first, and more about being the best option for travelers craving something authentic and well-managed.

Revenue Trends: Steady Growth, New Predictability

For those tracking the numbers, a 1.5% increase in ADR may sound conservative, but the real prize is confidence in the future. Gone are the wild pricing swings and abrupt booking drops of the past few years. Instead, owners and managers can look ahead to slowly rising nightly rates and occupancy trends that support thoughtful planning.

For Denver owners with properties in up-and-coming neighborhoods or mountain-adjacent locales, 2026 presents opportunities to thoughtfully reinvest—from upgraded furnishings to better property tech or even adding rental insurance protections—to further lock in profitability. The lesson? Smart, steady moves outpace risky bets in the modern STR market.

Why 2026 Stands Out: A Chance to Play Offense

Ultimately, AirDNA’s 2026 Outlook report helps answer a question many property owners have been asking: “Is it really a good time to get (back) into short-term rentals?” From both a local and national perspective, the answer is increasingly positive. The fundamentals for success—demand, price stability, and favorable tax policies—are finally lining up after years of uncertainty.

Denver is well placed for owners who are looking to move from hands-on management toward passive, optimized income. Tools for automated rent collection and digital property inspections continue to help owners scale back their time commitments while ensuring full compliance and high guest satisfaction.

“2026 is opening meaningful opportunities for both new and experienced operators, but capturing them depends on understanding how market conditions are shifting.”

The local market isn’t immune to change, but with actionable data, property owners can sidestep common pitfalls and set up for consistent returns. If you’ve been waiting for a sign to act, the combination of cooling home prices, strong traveler appetite, and policy support makes 2026 as close as it gets.

Looking Forward

As we move through the start of 2026, Denver’s short-term rental scene is transitioning from uncertainty to a space defined by data-backed opportunities. Owners here—whether managing one LoDo flat or several Foothills escapes—have a chance to refine their approach and benefit from a market that is finally favoring thoughtful investment and professional management. Stay watchful, play smart, and make the most of the year ahead; Denver is ready for it.