Lately I’ve been hearing that the STR business in the Poconos is down and that the market is oversaturated. Some of my clients are doing quite well, some not as well as they hoped. It’s a good time for a deeper discussion about the potential to operate a profitable STR in the Poconos.
According to the Poconos Visitor Bureau, tourism continues to grow in the region with visits up (two percent by the latest count.) The visitor bureau publishes statistics including hotel stays and vacation rental nights, and as a whole, tourism is a growing industry in the area with a modest and steady increase predicted. There are fluctuations due to weather, but a big plus for the Poconos is location, a drivable destination that has 47 million people that are less than a 3-hour drive away. There are nearly 2 million STR night stays in the Poconos each year. In 2023, a cool damp spring may have kept some weekenders away, but wonderful weather contributed to a record crowd at Pocono’s NASCAR race and many STR operators are reporting strong July and August bookings across the region.
The vacation rental business in the Poconos has brought new and ambitious STR investors to our area in recent years. These new operators are certainly raising the bar on many of the vacation home communities in the area with their vision to build profitable vacation rental businesses. That has contributed to the creation of a new trade association advocating for the STR industry, the Poconos Association of Vacation Rental Owners. The group estimates there are somewhere in the range of 6,000 – 7,500 licensed Short-Term Rental Properties in the four county Pocono Region.
For those that have not updated their properties in years, have the same old generations old fixtures and furnishings, business has gotten a little harder. While renting a vacation home can still be a very profitable enterprise, the higher level of competition is something all operators should be thinking about as the new entrants look for ways to standout and get their share of the vacation rental market.
For generations people have chosen to vacation in the Poconos whether for a weekend, a week, or an entire season. Licensing costs and increased fees (community guest fees, cleaners) have pushed the economics of operating profitably toward bigger homes for longer stays which is one factor a future investor should consider. Since the Poconos are filled with modest sized summer homes and many of them are listed on the booking sites, bigger seems better. Beyond size, then how can your rental standout?
The Pocono Mountains region is a competitive market for STR. The region spans four counties and a wide variety of attractions. In another article, What Brings People to the Poconos, I discuss how vacation homes themselves might be the areas biggest attraction. If you are looking to invest, or reinvest in a vacation rental in the Poconos, themes (design, décor, furnishings) are one way to make a property standout. Another is to add a property amenity that can go toward creating a memorable experience.
Here are a couple of observations on things I’ve seen that help a property standout.
Note that I have not mentioned a Hot Tub or Barrel Sauna or other spa-like amenities. It seems like a hot tub is a such a common feature and almost as required as a good outdoor deck. Yes, I think you should have one, but only if your operations team can support one. A gross hot tub can ruin your chance at a 5-star review, so only have a 5-start hot tub experience.
To answer the question: Can you still make money with Short-term Rentals in the Poconos?
The answer is YES, you a can still do very well in the Poconos with a STR investment, but you’ve got to rise above the average to do so.
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July 03, 2023
Some communities are more friendly to VRBO and Airbnb, others oppose the practice. Here is an summary drawn from various HOAs (Home Owner Associations) and township regulations. Last Updated: February, 2024 ARROWHEAD LAKE (Coolbaugh Township and Tobyhanna Township, PA) As one of the area’s most recognized vacation home communities, Arrowhead Lake has a rich traditionContinue reading "Short-term Rental Friendly Pocono Communities"
March 01, 2022
Zoning, Rules and Regulations regarding Short-term Rentals, VRBO and AirBnB are changing in the Poconos, here is a scorecard of municipalities and what they say about running a short-term rental from your vacation home or income property.