Is Running an Airbnb in Memphis Worth It?

If you're considering launching a short-term rental in Memphis, you've probably asked yourself the same question every prospective host wrestles with: Is it actually worth it?

The short answer: yes—but only if you understand how this market really works.

Memphis isn't a beach town or a ski resort. Tourists aren't flooding in to lounge poolside. But that's exactly what makes this market interesting for investors who know how to operate.

Here's what the data says—and what we've learned managing dozens of STRs across the city.

The Memphis STR Market by the Numbers

Let's start with the baseline metrics.

The citywide average occupancy is around 54%, with an average daily rate (ADR) of $131. A typical 2-bedroom generates $25,000–$30,000 in annual revenue. There are roughly 2,000 active listings in the market.

Our portfolio runs differently: 70% average occupancy, ADRs above $140, and annual revenue of $35,000–$45,000 per property.

The citywide average is solid—above the national STR average of around 50%. But here's the thing: averages hide the spread between well-run properties and everyone else.

Operators who accept one-night stays, welcome pets, price dynamically, and turn units fast consistently run 15–20 points above market. Those who set two-night minimums and let pricing run on autopilot? They're dragging that average down.

Memphis Isn't a Vacation Market—That's the Opportunity.

Over 40% of guests booking Memphis STRs arrive within 48 hours of check-in. They're not planning two-week vacations.

They're:

• Driving through on I-40 or I-55 and need a one-night stop.
• Traveling for work—healthcare, logistics, corporate. Visiting family and want more space than a hotel.
• Attending events—Liberty Bowl, FedExForum, Beale Street Music Festival.



This means your property needs to be available, flexible, and ready to turn fast. If your cleaner can't flip a unit in under an hour, you're leaving same-day bookings on the table.

Many hosts fight this reality. They want two-night minimums because turnovers are a hassle. But in Memphis, that approach cuts you off from nearly half the market.

What Does It Actually Cost to Run?

Rough operating costs for a typical Memphis STR:

• Mortgage (if financed): $800–$1,500/month.
• Utilities: $150–$250/month.
• Cleaning (per turn): $75–$150.
• Supplies and consumables: $50–$100/month.
• Management fee (if applicable): 10–25% of revenue.
• Maintenance reserve: $100–$200/month.
• Insurance: $100–$150/month.

A well-run 2-bedroom in a decent location can gross $2,500–$4,000/month. After expenses, net cash flow typically lands between $800–$1,800/month—if you're hitting 65%+ occupancy and keeping costs tight.

The operators who struggle are usually overpaying for third-party cleaning, not pricing dynamically, ignoring maintenance until it becomes an emergency, or setting minimums that kill occupancy.

The Management Question: DIY vs. Hire Out

Self-managing an STR is a second job. Guest messages come in at midnight. Cleaners cancel. The HVAC dies on a Friday in August.

If you have time and you're local, self-management keeps more money in your pocket. But most owners burn out within 6–12 months.

Professional management typically costs 15–25% of revenue in Memphis. At that rate, you're paying $4,000–$8,000/year on a $30K gross property—and still often getting third-party cleaning invoices on top.

That's why we built LPS differently: 10% management fee, in-house cleaning, in-house maintenance, no markups. Our owners keep more and get better service. But even if you don't work with us, the principle holds: find a manager who actually operates, not one who just coordinates vendors and collects a check.

So... Is It Worth It?

Here's the honest answer.

Yes, if you buy in a location with real demand, price dynamically and stay flexible on minimums, treat it like a hospitality business (not passive income), and either commit to self-managing well or hire operators who know what they're doing.

No, if you expect "set it and forget it" income, you're not willing to accept one-night stays or pets, you're overleveraged and need 80% occupancy just to break even, or you hire a manager charging 20%+ and still outsourcing everything.

Memphis won't make you rich overnight. But it's a market where disciplined operators consistently beat the averages—and the entry price is far more forgiving than Nashville, Austin, or the coasts.

Ready to Run the Numbers on a Specific Property?

Use our free STR Deal Calculator to model revenue, expenses, and cash flow on any Memphis address. It's the same tool we use internally to evaluate properties.

If you already own a property and want to talk management, get in touch—we'll give you an honest assessment of what it could earn.