Some states are more popular than others. If you asked a range of people from outside of the United States to name five states, California would certainly be one of the first states mentioned. The home of Hollywood, celebrities and the iconic LA lifestyle, California is arguably the most popular state in the entire country. 

From a property investment standpoint, California has always been a safe bet and is often regarded as one of the best places to own Airbnb property. California is the third biggest state in the country. For vacation rental property investors, hearing ‘invest in California’ is a smidge too general. The state of California has a land area of over 423,000 km2, which means there are thousands of potential property investment locations. But, where are the best places to own Airbnb properties in California? 

Before we dive into our list of best places to invest in California, we first want to explain how we arrived at this selection and which data insights we used in our analysis. 

Which Data Insights Did We Analyze?

In order to ascertain which areas of California are the most viable for property investment, we had to dive into the extensive data that our AI-driven, smart analysis engine collects on an hourly, daily, monthly, and yearly basis. We are constantly collecting and analyzing data and without it, these lists wouldn’t be possible. 

Annual Occupancy Rates

We consider Occupancy Rates amongst the most important data insights in an analysis of investment market viability. A month-on-month occupancy rate report of a certain market will show you how popular that market is, and which months see the highest booking numbers. For vacation rental property investors, this is invaluable information. 

Average Daily Rate

Another extremely helpful statistic that vacation rental property investors like to use is the Average Daily Rate. This shows how much, on average, each night sells for in your specific market. This, combined with the occupancy rate, gives potential investors a snapshot of the potential income they could earn if they operate a vacation rental in this market. 

Market Supply

It’s a slightly different way of saying it, but the market supply is simply the number of active listings in a market at any given time. We typically see this number fluctuate based on the time of year. Some hosts only rent out their property during the summer months and inhabit the property personally for the rest of the year. Some use the winter to make changes to their listing, either cosmetic or full-blown renovations. If a market has a small number of listing in peak season, it’s a point of concern. Either there is restrictive legislation in place or the market is simply not that popular and therefore, not very profitable. 

Day of the Week Occupancy

The Day of the Week Occupancy statistic goes into greater detail than the Occupancy Rate shows. Instead of a monthly view, you’ll have a weekly view. You’ll be able to ascertain if your market is busy only on weekends, only during the week, or a nice balance of both.  

Best Places to Own Airbnb Property in California

Joshua Tree

Home to Joshua Tree National Park, this market is well-known for its exceptional scenery and awe-inspiring natural beauty. Attracting over 3 million people per year, Joshua Tree is a great location for vacation rentals.

Average Daily Rate: $260 – $275
Annual Occupancy Rate: 65%
Average Annual Market Supply: 1,300
Day of the Week Occupancy: Saturday, Sunday, Monday, and Tuesday are the most popular days. 

South Lake Tahoe

With an impressive 15 million visitors each year, South Lake Tahoe is one of the most popular rural tourist locations in California. With an impressive range of celebrities owning houses in South Lake Tahoe, it’s no wonder that vacations here are so popular. 

Average Daily Rate: $410
Annual Occupancy Rate: 62%
Average Annual Market Supply: 2,200
Day of the Week Occupancy: Saturday and Sunday are the most popular days. 

Los Angeles 

A place like Los Angeles needs no introduction. It’s the home of Hollywood and the movie industry. LA sees 50 million visitors each year, making it the most popular city in California, by far. 

Average Daily Rate: $230
Annual Occupancy Rate: 73%
Average Annual Market Supply: 18,800
Day of the Week Occupancy: Saturday, Sunday, Monday, and Tuesday are the most popular days. 

Palm Springs 

Palm Springs sees almost 13 million visitors each year and it’s no surprise why they flock there. Hot springs, lush golf courses, five-star hotels, and award-winning spas all await visitors to Palm Springs. 

Average Daily Rate: $515 – $530
Annual Occupancy Rate: 67%
Average Annual Market Supply: 5,150
Day of the Week Occupancy: Saturday, Sunday, Monday, and Tuesday are the most popular days. 

Long Beach 

Long Beach is the 42nd most populous city in the United States. As a coastal city, Long Beach offers visitors a mixture of seaside fun and city attractions, plus the RMS Queen Mary is docked here permanently! 

Average Daily Rate: $224
Annual Occupancy Rate: 76%
Average Annual Market Supply: 1,875
Day of the Week Occupancy: Sunday, Monday, and Tuesday are the most popular days. 

San Diego

San Diego is located near the US-Mexico border and because of this location, it sees sunshine, warm weather, and over 35 million visitors a year. Home to the iconic San Diego zoo, this city is massively popular in the summer season.

Average Daily Rate: $280
Annual Occupancy Rate: 75%
Average Annual Market Supply: 4,560
Day of the Week Occupancy:  Sunday, Monday, and Tuesday are the most popular days.