Short‑term rentals (STRs) continue to evolve across the U.S., and Massachusetts is no exception. As travelers seek coastal escapes, historic towns, and proximity to major urban hubs, certain Massachusetts markets stand out for their rental demand, pricing power, and investment potential. Below, we detail five of the top STR markets in Massachusetts as of 2025—why they shine, what metrics support them, and what to watch out for.

How We Selected These Markets

To identify the top towns/markets, we focused on several key criteria:

• Average Daily Rate (ADR) & Occupancy — ability to command premium nightly rates and maintain strong booking levels

• Gross Revenue Potential — what STR owners are earning, especially relative to cost of ownership

• Regulatory Environment — the permitting, licensing, zoning, and legal risk in each town or city

• Tourism / Guest Appeal — proximity to beaches, historic districts, nature, festivals, and attractions that draw visitors

• Barriers to Entry / Cost vs Upside — property purchase cost, competition / saturation, ease of entry

1. Boston / Cambridge — Best Urban / High‑Demand Hub

Why it stands out

As Massachusetts’ biggest city and economic core, Boston offers a compelling mix of history, tourism, academic institutions, business travel, and urban amenities. Cambridge adds strength with the presence of universities like Harvard and MIT, and its proximity to Boston proper. Listings in these cities are in high demand year‑round, though there are regulatory and cost hurdles.

Key Metrics & Highlights

• Boston: ADR ≈ $255.81/night, occupancy ≈ 49.10% with over 2,700 active listings. 

• Cambridge: ADR ≈ $224.16/night, occupancy ≈ 52.62%, about 744 listings.

• Framingham (suburban, near Boston): For “strong performing” properties, ADRs in Framingham can reach $239+ in peak months; median ADR much lower, depending on property type. Occupancy in strong listings is relatively high.

Strengths & Opportunity

• Consistent, year‑round demand: Between tourists, business travelers, academics, events, and conventions, demand isn’t limited to summer.

• High ADR potential: Proximity to historic sites, good restaurants, transport links (airports, commuter rails), and walkability allow premium pricing.

• Large property management infrastructure: Access to cleaning, maintenance, supplies, co‑hosting, and management services is relatively easy in metro areas.

• Potential for Airbnb / short‑term rental arbitrage: In suburbs or fringes, investors may find properties that are more affordable but still accessible to Boston/Cambridge demand.

Risks & Watch Points

• Cost of entry is high: Real estate prices around Boston and Cambridge are among the highest in Massachusetts, which heavily increases upfront capital required.

• Regulatory pressure: Boston / Cambridge have stricter rules than many small towns. Licensing, safety inspections, zoning restrictions, short‑term rental caps, transient occupancy taxes, etc. are more burdensome.

• Occupancy volatility: While demand is steady, monthly fluctuations can be large. For example, ADRs often peak during tourist season or special events; winter months may see lower occupancy. 

• Competition & guest expectations: High standard of listings is required; guests expect modern amenities, great design, good reviews. Poorly managed properties underperform heavily.

2. Nantucket / Cape Cod Region — Best Coastal & Summer‑Luxury Market

Why it stands out

If you want premium coastal appeal, beautiful beaches, luxury atmosphere, and high nightly rates, Nantucket and Cape Cod (towns like Barnstable, Dennis, Falmouth, Yarmouth, etc.) are hard to beat. These towns are well known, attract wealthy and international visitors, and allow owners to charge high ADRs; although occupancy may be seasonal, the revenue per available room (RevPAR) can be very strong for well‑positioned listings.

Key Metrics & Highlights

• Nantucket: ADR ≈ $991.78/night, occupancy ≈ 37.52% across ~570 properties. 

• Barnstable: ADR ≈ $447.52/night, occupancy ≈ 39.61% across ~581 properties. 

• Falmouth & Yarmouth also appear high up: Falmouth ADR ≈ $417.12/night, occupancy ≈ 38.88%; Yarmouth ADR ≈ $367.33, occupancy ~38.13%. 

• Somerset (though not in Cape Cod) is noted as an “affordable entry point,” but for Cape Cod region the property values are much higher.

Strengths & Opportunity

• Luxury / Premium pricing: Because of coastal views, beach access, charm, prestige, guests are willing to pay high rates, especially in summer and shoulder seasons.

• Strong seasonal peaks: Summer months are very busy; occupancy and ADR peak. Properties on or near the water, or with excellent amenities, do especially well.

• Tourist infrastructure: Cape Cod has well‑developed tourism ecosystems (restaurants, attractions, ferry services, shops, etc.), which strengthens guest appeal and keeps the area vibrant.

• Brand recognition: Names like Nantucket, Cape Cod, Provincetown command attention in search listings; strong reputation helps with visibility.

Risks & Watch Points

• Low occupancy outside peak season: Winter and early spring can see much lower demand; many properties may sit idle or under‑booked. Owners must budget for large down‑times.

• Very high property costs and maintenance: Purchase price per square foot is steep; insurance (especially flood/coastal risks), upkeep, exterior maintenance (salt exposure, storms) cost more.

• Regulatory constraints: Many coastal towns have or are considering stricter STR regulations: caps, licensing, safety codes, occupancy limits, parking restrictions, etc.

• Strong competition & high guest expectations: Because many high‑end hosts compete here, listings must be premium: good décor, amenities, views, excellent guest service.

3. Salem & North Shore Massachusetts — Best For Coastal History & Proximity to Boston

Why it stands out

The North Shore, especially towns like Salem, offer a blend of historic appeal, coastal scenery, and proximity to Boston. Tourists like Salem for its colonial history, museums, Halloween/haunted attractions, waterfront charm, shops & restaurants. Suffolk County’s closeness to Boston gives potential guests who want a quick getaway. Many towns here (Salem, Gloucester, Marblehead, etc.) are in high demand, especially during warmer months.

Key Metrics & Highlights

• Salem: ADR ≈ $325.33/night, occupancy ≈ 50.83% across ~305 listings.

• Other North Shore towns also show up in the top‑30 list: Gloucester ranks #19: ADR ≈ $427.60, occupancy ≈ 43.80%.

• Revere is noted as “Best for high occupancy,” partly because of its proximity to Boston and the coastline, though ADRs are lower. 

Strengths & Opportunity

• Historic & touristic pull: Salem especially has strong draw year‑round, but spikes around events (e.g. Halloween), maritime history, museums. Coastal towns add scenic plus water access, beaches, seafood.

• Good occupancy for listings near Boston: Weekend visitors, short getaways from the metro area often prefer North Shore towns because travel time is reasonable.

• Balance of cost vs premium: Though property values are elevated, in many cases you can find listings and neighborhoods that are more affordable than Cape Cod or Nantucket yet still attract strong guest interest.

• Steady shoulder season demand: Fall foliage, coastal walks, local festivals help fill months outside peak summer.

Risks & Watch Points

• Variable ADR vs high cost neighborhoods: If you're not in a premium location (water view, walkable downtown, historic homes), ADR may be significantly lower. So location within town matters strongly.

• Regulatory oversight: North Shore towns often have zoning, historic preservation constraints, safety inspection requirements. Some may restrict STR use in residential neighborhoods.

• Seasonality effects: Summer dominates; winter and early spring see dips. Unless amenities (heating, snow removal, year‑round attractions) are strong, many properties experience low returns off peak.

• Competition among coastal towns: Gloucester, Salem, Marblehead, and others compete for similar guests. Distinctiveness in listing, guest amenities, review quality, etc., is key.

4. Somerset, MA — Best Affordable Entry Point

Why it stands out

Somerset is emerging in investor conversations as a “sleeper” and affordable entry point. It doesn’t have the prestige of Cape Cod or Boston, but it offers compelling revenue relative to cost. If you are an investor who wants good return without the ultra‑luxury cost, Somerset presents a strong option.

Key Metrics & Highlights

• Somerset sees an average property bringing in $76,113 annually, with an ADR of $394 and occupancy ≈ 50%.

• The average asking price in Somerset for STR‑eligible properties is approximately  $524,258.

• Listings in Somerset have seen a ~17% rise year‑over‑year, suggesting growing investor interest.

Strengths & Opportunity

• Lower barrier to entry compared to expensive coastal or metro markets: Purchase prices in Somerset are significantly lower than Cape Cod / Boston outskirts; you can get more square footage or nicer amenity with less capital.

• Solid ADR with less competition: Because the market is still relatively small, you may find less saturated competition, so easier to stand out.

• Potential upside: As demand for more affordable or mid‑premium coastal or water‑adjacent stays increases, Somerset may benefit from spillover.

Risks & Watch Points

• Smaller population and fewer amenities: Guest expectations around restaurants, attractions, nightlife may be lower; need to manage listings accordingly.

• Marketing & exposure: Being lesser known, you may need to work harder on photography, listing visibility, guest reviews to draw traffic.

• Seasonality still relevant: Though perhaps less extreme than pure beach towns, demand likely peaks in summer, drops in winter; off‑season utilization strategies needed.

• Regulation & local rules: Even smaller towns increasingly adopt licensing/inspection rules for STRs; due diligence is required.

5. Revere, MA — Best for High Occupancy & Proximity to Boston

Why it stands out

Revere, just north of Boston, offers proximity benefits: access to Boston’s job centers, tourism infrastructure, the airport, plus coastal (beach) draw. It’s well positioned for guests who want the “Boston” experience without the cost of Boston proper, or want a beach nearby. It reflects potential for urban fringe STRs.

Key Metrics & Highlights

• Revere is shown as one of the “best Airbnb markets in Massachusetts to invest in” for high occupancy.

• The ADR in Revere tends to be lower than Boston or premium coastal towns, but occupancy tends to be higher due to convenience and proximity. Exact ADR/occupancy numbers published for Revere, but its positioning suggests relatively stable demand. 

Strengths & Opportunity

• Proximity to Boston: Guests can stay in Revere and access Boston’s attractions; good for weekend or short stays. Also close to Logan Airport, which helps for travelers.

• Beach and coastal access: Revere Beach is a known draw; having beach amenities boosts appeal.

• Higher occupancy: Because of ease of travel, appeal for both locals and out‑of‑town visitors wanting cost savings vs Boston proper.

Risks & Watch Points

• Lower ADR vs premium towns: Because homes are less premium (or property stock is lower/end more modest), ADR will often lag places like Nantucket or Cape Cod. Profit depends more on volume/occupancy.

• Neighborhood specifics matter: Some parts of Revere are more desirable than others; noise, safety, walkability, local services matter greatly.

• Regulatory risk & local ordinances: Towns close to big cities often adopt strict rules (zoning, permitting, noise, parking, etc.). Must check local regulations carefully.

• Seasonality & demand variation: Summers and weekends stronger; weekdays and off seasons weaker unless listings are marketed well for remote/work stays.

Honorable Mentions & Rising Neighborhoods

There are several other towns/markets in Massachusetts that nearly made the top 5, or are rising quickly. Some worth monitoring:

• Plymouth, MA: Strong tourist draw, beaches, historical sites. ADRs high in summer, though demand drops in off‑season.

• Eastham, Dennis (Cape Cod sub‑markets): High ADRs, prestige, but also high cost & seasonality.

• Chatham, MA: Very premium, high nightly rates; great if you have capital, less so if you need steadier year‑round income.

• Somerville, MA: Urban fringe, good amenities, close to Boston; competition is high but guest expectations and ADR potential are strong.

Tips for Making STRs Work in Massachusetts in 2025

To succeed in these markets, here are best practices:

1. Underwrite conservatively
   Use occupancy rates well below peak, assume off seasons, include maintenance, insurance, utilities, and all fees in your cost model.

2. Choose location carefully
   Within a town or city, proximity to attractions, walkability, ease of access, parking, and safety often matter more than just the town name.

3. Design & amenities matter
   Quality photos, great interiors, modern amenities (wifi, AC or heating, kitchen equipment), good guest reviews can drive ADR and occupancy significantly.

4. Be aware of local regulations before buying
   Investigate municipal STR ordinances, permit/licensing requirements, safety codes, parking rules, zoning. Sometimes rules change rapidly, especially in coastal towns or high‑demand tourist zones.

5. Manage seasonality
   Offer promotions, adjust minimum stays during slower times, aim for shorter stays during off‑peak, and longer stays during peak; possibly target remote workers or people who want longer stays in non‑peak months.

6. Monitor and adjust pricing often
   Use dynamic pricing tools, track demand, competitor listings, events, holidays to adjust rates.

7. Operate efficiently
   Reliable cleaning/maintenance services, prompt guest communication, good systems. In high turnover or remote properties, logistics and operations can sink margins if not well managed.

8. Plan exit or conversion flexibility
   If regulation tightens, or demand shifts, ensure your property can be converted to long‑term rental, or be sold without huge loss.

Here’s a quick comparison to help you decide which Massachusetts market might best align with your investment goals, risk tolerance, and capital:

If you match your investment strategy to a town that aligns with your strengths (capital, ability to manage, design/amenity investment, willingness to deal with regulation), you have a strong chance of good returns in Massachusetts in 2025.