When Chris Broomfield purchased a five-acre property in 2015, he already had plans to build several cabins. What he didn’t know was just how successful his new venture would become.
“I always knew it was going to be an Airbnb property. I knew I was going to put multiple cabins on it,” he told CNBC Make It (1). “I chose this property because it was close to the lake. It was very wooded, and it had rolling hills. I saw its potential with multiple cabins.”
Broomfield now owns several rental properties in Remsen, New York that he built himself, including a treehouse cabin.
Suspended 14 feet in the air, the Treehouse features two bedrooms, a private pond and stunning views of a waterfall. To access the home, guests have to cross an 80-foot suspension bridge (2). This unique rental property is one of the most well-reviewed properties in New York due to its breathtaking views and unique setting.
Despite the effort required to build the cabins, Broomfield is turning a tidy profit. Since 2018, his business, Evergreen Cabins, has generated more than $2.1 million. Using dynamic pricing, Broomfield’s rate for each of the cabins ranges between $380 and $700 a night.
While Broomfield’s success is impressive, it may not be very easy to replicate. As rental properties become a popular side hustle, investors who are interested in such a venture may want to consider whether Broomfield’s path is repeatable before taking the leap.
Stories like Broomfield’s help to explain why short-term rentals continue to attract would-be investors. Platforms like Airbnb have made it easier than ever to market unique properties, and coverage of these stories on the news and social media often makes something like buying property and building cabins look easy.
But high nightly rates don’t always translate into steady profit, as occupancy rates can vary widely by location, season and competition. According to AirDNA, the average U.S. Airbnb host earns approximately $14,000 per year, though actual income can vary widely by market (3). Many hosts see strong demand during peak travel months, followed by long offseasons.
Higher borrowing costs have also changed the equation. Mortgage rates remain well above pre-pandemic levels, increasing monthly payments for investors who rely on financing. At the same time, home prices remain historically high. According to Redfin, median home prices are still significantly above 2019 levels, even in regions where prices have cooled (4).
Regulations are another wildcard. Many cities and counties across the U.S. have introduced tighter rules on short-term rentals, including permit requirements, limits on non-owner-occupied properties and higher taxes or fees (5). New investors could potentially spend thousands (or hundreds of thousands) only to be forced out of the short-term rental industry by new regulations.
In Broomfield’s case, several factors worked in his favor: he bought land at a relatively low price ($27,000 for five acres), had decades of construction experience, and created unique properties that stood out in search results and on social media. For many investors, replicating that combination of factors may be difficult.
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The takeaway here isn’t that rental properties are a bad investment; it’s that success in this industry is rarely predictable or guaranteed. Anyone considering a similar path should take time to run the numbers and understand the risks before getting started.
Here are a few things to keep in mind:
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Local demand and seasonality: Look beyond peak rates and examine year-round occupancy trends. A property that rents for $500 a night but sits empty for half the year may underperform when compared to a lower priced, consistently-booked rental
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All-in costs: Beyond the purchase price, make sure to budget for costs like insurance, property taxes, utilities, maintenance, cleaning, platform fees and management or labor costs
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Regulatory environment: Before buying, look into local short-term rental laws, zoning rules and licensing requirements. Some municipalities can change rules with little notice, which may affect whether a property can legally operate as a vacation rental
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Financing risk: Higher interest rates increase pressure on cash flow. Consider whether the property can break even, or at least cover expenses, during slower periods. If not, make sure you have the cash flow to cover costs
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Financial safeguards: Keep a dedicated emergency fund and avoid over leverage to protect against slow seasons or regulatory changes
Broomfield’s success serves as a reminder that experience, cash and hands-on effort matter. For those inspired by high-earning rentals, the smartest next step isn’t to buy quickly — it’s to do the research, run conservative numbers and ensure your financial foundation is secure before taking the leap.
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CNBC Make It (1); Airbnb (2); AirDNA (3); Redfin (4); Business Insider (5).
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
