Balance and Opportunities in the Poconos Vacation Home Market
The intense seller’s market of the past few years has passed, and we are firmly in a balanced market here in the Poconos Vacation Home Real Estate. Mortgage rates, while still elevated compared to the ultra-low rates of 2020-2021, have eased slightly, giving investors more financing options. In parts of the Poconos, home prices have softened slightly but largely held steady, particularly for well-maintained, larger and unique properties.
Tourism, a key factor in the regional economy remains strong and may be even stronger in the year ahead. Vacation rental inventory is in slight decline and that is making the investment outlook vacation rental properties look better in the year ahead. Properties that can obtain a short-term rental license are priced higher than those that can’t and ones that have an active license see a significant price premium. Both the overall real estate and vacation rental markets have reached a healthy equilibrium.
Real Estate Market Trends: 2025 Update
Inventory levels, properties for sale have normalized to some extent. Properties that are turnkey and in desirable locations are still selling quickly, often with multiple offers. Average properties, however, are taking longer to sell, and pricing must reflect condition, location, and amenities. Overall average time on market is rising, but the STR-friendly and Turnkey-STR homes for sales get snapped up quick.
Homes purchased during the peak of 2022-2023 have maintained value but are not seeing much appreciation unless substantial improvements have been made. Sellers who overprice their listings are seeing longer days on market and occasional price reductions. Buyers are more discerning, expecting value for their investment, and negotiations have become more common again. Homes seem to sell in either 5 days, or 75 days.
From a real estate investment perspective, rational behavior has returned. Both buyers and sellers are finding moderate success, and deals are being made when pricing expectations are realistic. This is a better market dynamic for vacation home investors and second-home buyers alike. For those that purchased before 2021, strong capital gains are likely.
Vacation Rental Market: 2025 Update
The vacation rental market looks good. The surge of post-pandemic “revenge travel” has cooled, and travelers are once again considering trips to the Poconos versus air travel to more distant destinations. The Poconos’ strategic location within a 3-hour drive of 47 million people continues to support a strong vacation home rental and resort travel market, year-round.
In the 2025 State of the Vacation Rental Industry, PMVB CEO Chris Barrett reports that visitor count should surpass 30 million in 2025, and that the region generally does well when the economy tightens, and travelers focus on value. The Poconos historic place as a drive-to, value destination once again puts it in a favorable place to investors looking to balance their portfolios.
As highlighted in Chris’s presentation, a focus on luxury has been a winning strategy for both resorts and vacation rentals here in the Poconos. Homes with pools and nice amenities on site are renting much better than those that are focused on the budget-minded visitor.
One trend that has fully returned is the dominance of last-minute bookings. Approximately 30% of vacation rentals are now booked within 10 days of arrival, a trend that seems to echo national patterns. This shift has challenged some operators who prematurely lowered prices, fueling perceptions that the STR business is “soft.” Exceptional properties with strong reviews and amenities continue to perform well. The market continues to evolve toward an “80/20 rule,” where 20% of properties generate 80% of the rental income.
STR Challenges: Not All Properties Succeed
Newer investors who jumped into the Poconos STR market during the boom without adequately updating or marketing their properties are now facing challenges. Properties with mediocre reviews, dated furnishings, or maintenance issues are struggling with occupancy and often end up back on the market. Savvy investors recognize that guest expectations have risen, and that professional property management, consistent maintenance, and effective marketing are key to success.
Pocono communities with restrictive vacation rental policies have also seen housing prices soften greater than those that allow short-term rentals. Notably, “The Hideout” community, once a stronghold for STRs, saw significant price declines after regulatory disputes led to the HOA losing a very visible court case and potentially being liable for millions of dollars in refunds and damages. Townships that have restricted STR are seeing declines in real estate activity and prices and face prices and a sharp decline in real estate activity, which could impact township budgets reliant on transfer taxes.
While overall tourism numbers remain strong (per the Pocono Tourism Marketing Dashboard), the pressure on lodging demand has eased. Several Pocono townships report a decrease in active STR licenses, reflecting a market correction. For example, Coolbaugh Township saw active STR licenses drop from a high of 1,450 in 2023 to just over 1,000 today. The increased costs of licensing and community fees seem to be forcing the part-time, casual renter out of the market, so the drop in licenses doesn’t exactly correlate with a drop in available rental nights as many communities are seeing fewer seasonal operators and more professional, full-time STR hosts. One example of this, “Snow-bird” rentals (owners rent in winter, while they are in Florida and return to reside in their place for the summer) may now be shifting to full season winter rentals as opposed to STR for weekends. Season rentals do not need STR licenses, STR licenses are only needed for rentals less than 30 days.
The Future of STR Investment in the Poconos
Despite a more competitive market, the Poconos remains an attractive destination for vacation rental investment. Key fundamentals are still in place: a prime location, easy drive access for millions, a natural setting with four-season recreational opportunities, and a variety of lodging options from budget-friendly to luxury.
The market is increasingly segmented. Budget travelers continue to find great options, while luxury travelers are supporting a growing high-end market of large homes designed for events, retreats, and extended family gatherings. Investors able to deliver outstanding guest experiences, maintain high property standards, and market effectively will continue to find success.
Savvy buyers willing to invest time and capital into the right properties will find opportunity here. The Poconos isn’t a “get rich quick” market — but it is still a “build steady wealth” market for vacation rental investors who are strategic, patient, and committed to quality.
If you’re considering buying or selling a vacation rental property in the Poconos, the opportunities are still here — but strategy matters more than ever.
