Buying a house in the desert? Here’s what to expect in 2020

There are four important Airbnb trends that will benefit investors in 2020. These include the market’s profitability, high appreciation rate, relative affordability, and exceptional tourism.

Excerpt via Mashvisor
December 12, 2019

The California housing market is no stranger to tourism. With hundreds of millions visiting the state every year, it’s no surprise that buying and renting out Airbnb short-term rental properties has become a common investment strategy. This is particularly true in one of California’s most visited markets: the Joshua Tree real estate market. This begs an interesting question: Should you invest in Airbnb Joshua Tree in 2020 and become a Joshua Tree real estate investor?

The short answer is…yes! You should definitely purchase an Airbnb rental property in Joshua Tree in 2020.

Why You Should Invest in Airbnb Joshua Tree in 2020

There are four important Airbnb trends that will benefit investors in 2020. These include the market’s profitabilityhigh appreciation raterelative affordability, and exceptional tourism.

why invest in Airbnb Joshua Tree rentals in 2020

1. Joshua Tree Short-Term Rentals Are Profitable

The essence of rental property profitability is rental income. Fortunately for investors, high rental income is a prominent feature for the average Airbnb rental property in Joshua Tree. According to Mashvisor’s investment property calculator, the average Airbnb rental income in the area is $3,061. Return on investment, as cash on cash return and cap rate, is also impressive. At 7.43%, Joshua Tree’s average ROI is significantly greater than California’s average Airbnb ROI of 2.37%. What’s even more motivating is that these figures are merely averages.

To sum up Mashvisor’s Airbnb data for Joshua Tree:

  • Average Airbnb Rental Income: $3,061
  • Average Return on Investment: 7.43%
  • Average Airbnb Occupancy Rate: 59%

2. Joshua Tree Real Estate Will Appreciate

Running an Airbnb in Joshua Tree will generate a lot of rental income, as we just discussed. It will also generate real estate appreciation, or an increase in property value. Appreciation has been a consistent positive influence in the Joshua Tree real estate market for many years now, even during the national recession. According to NeighborhoodScout, Joshua Tree has appreciated by nearly 95%, placing it in the top 10% for national appreciation. For 2020, Zillow projects the average Joshua Tree investment property to increase in value by a whopping 8.6%.

3. Properties Are Relatively Affordable

Like many other cities in the California housing market, Joshua Tree is ripe with appreciation and rental income. Fortunately, it dodges the greatest con of California real estate– it’s unaffordability. According to Mashvisor’s investment property calculator, the median property price in Joshua Tree is $314,201. This places the area’s property prices much closer to that of the national median ($300,000) than to that of its state market ($693,000). With the presence of large, horribly inexpensive cities in The Golden State, Joshua Tree shines as a hidden gem with its cheap property prices.

4. Local Tourism Will Continue to Drive Demand for Airbnb Rentals

Finally, we cannot talk about Airbnb Joshua Tree without touching on the area’s thriving tourism industry. Home to the Joshua Tree National Park, the area is never in shortage of tourists. In 2017, the area welcomed over 2.9 million tourists, which was a 400,000 increase from the previous year. With over 1,800 jobs and $138 million generated from tourism, it’s projected that the area’s tourism will increase in 2020. As a result, Airbnb will see increased activity and income in the next year as well.

All in all, Airbnb Joshua Tree is expected to be nothing short of a success in 2020. With expected legalization, high profitability and appreciation, low property prices, and ever-growing tourism, Joshua Tree will continue as a top Airbnb market in California.

Related: Is Airbnb Legal in Joshua Tree?

The implementation of Airbnb regulations has become a hot topic in the US housing market as of late. With the rise and success of Airbnb real estate investing, many areas nationwide have sought to regulate it. In order to understand how the Joshua Tree housing market fairs with this issue, we need to understand the background of Airbnb legalization in the area.

Brief Background on Airbnb Joshua Tree Laws

As it pertains to statewide Airbnb regulations, California is among the states that permit local governments to dictate short-term rental legalization or prohibition. Therefore, Joshua Tree Airbnb laws are dictated by those of the San Bernardino County where it is located. San Bernardino County, the largest US county by area, is home to many cities, unincorporated communities, and census-designated places (CDPs), the last of which Joshua Tree falls into. CDPs include both mountain and desert areas, such as Joshua Tree, in the county. Although the Airbnb regulations of San Bernardino’s cities, unincorporated communities, and mountain CDPs have been clearly-defined, the same has not been true of its desert CDPs.

Due to the lack of Joshua Tree Airbnb laws, the area has had its fair share of complaints regarding short-term lodging. Noise, traffic, and replacement of long-term properties, in particular, have been the cause for criticism among some of Joshua Tree’s residents.

Proposed Ordinance

To combat the aforementioned issues and others, Joshua Tree’s planning commissioners have proposed an ordinance that was most recently modified on September 5, 2019. As per the ordinance, short-term non-owner occupied rentals are permitted for 30 days or fewer at a time. The most notable regulations that will apply to Airbnb Joshua Tree vacation rentals include:

  • An operating permit that must be renewed every two years
  • Follow maximum occupancy standards based on unit square footage
  • Offer on-site parking
  • Sign up for trash service
  • Provide guests with a copy of the unit’s rules
  • The owner (or someone else) must be available to guests by phone 24-hours a day and be able to show up at the property within an hour

While these Airbnb regulations have not been implemented as of the time of this writing, it is likely they will go into effect sometime in 2020. An Airbnb Joshua Tree real estate investor should keep an eye out for any future developments and changes to the proposed ordinance. With clear Airbnb laws, both Joshua Tree investors and residents will benefit from safe and regulate.

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