What "short-term rental" means in Memphis
A short-term rental is any home rented for fewer than 30 days at a time, the Airbnb and VRBO model. Memphis treats it differently from a long-term lease, and since 2023 the city has required a permit to operate one. The rules live in Memphis Ordinance 5631.
The short version: most non-owner-occupied short-term rentals need a permit, there are caps and spacing rules in some areas, and properties that were operating before the ordinance may have grandfathering signals worth checking before you buy. Do not assume a property can be an STR just because it is a house. Confirm it first.
What a Memphis Airbnb actually earns
Forget the screenshots. The honest way to size a Memphis short-term rental is real comps: what similar homes nearby actually booked over the past 12 months, at what nightly rate and what occupancy. Our managed portfolio runs about 67% occupancy at a roughly $145 average nightly rate, ahead of the broader market, but your number depends on the home, the location, and how it is run.
That is exactly what our free analysis does. You give us an address and we pull the real comp set and show a low end, a typical case, and a high end, sourced so you can check it. No promise of an outcome, just the numbers.
The cost stack, with nothing hidden
Here is what actually comes out before you net, and what does not. Management is 10% of the rental revenue. Supplies (paper goods, toiletries, coffee) run about $50 a month, so $600 a year per unit. That is the deduction list.
Cleaning is $0 to you. The guest pays the cleaning fee at booking, we keep it, and our own in-house crew does the turn, so the cleaning line never touches your net. Insurance is owner-paid like your taxes and debt service, not a management holdback. Anyone quoting you a tidy "all-in" number that buries cleaning and insurance inside the fee is making the math look better than it is.
Why operations decide the return
A short-term rental is a small hospitality business. Pricing has to move with the calendar, turns have to be same-day and spotless, and a broken AC at 9pm is a one-star review unless someone answers. We own the cleaning company and keep maintenance in-house, so the turn and the fix are one accountable team, not a chain of subcontractors.
That is the real difference between the pro forma and the bank statement. The market gives you the ceiling. Operations decide how close you get to it.