Miami's Airbnb Premium Drops to 2.7% Net After All Costs

Miami's short-term rental gross revenue premium sits at 80% for a 3-bed house, but the gap between short-term and long-term rental income narrows dramatically once you account for every operating cost. This article breaks down the real numbers for both a 3-bed house and a 2-bed apartment in Miami-Dade County, because the cost structures differ: apartments carry HOA fees that houses avoid, but their lower entry price changes the yield math.

A 3-Bed House Nets 2.7% as a Short-Term Rental After about $41,000 in Annual Costs

The table below compares a self-managed short-term rental against a self-managed long-term rental for a median 3-bed house in Miami-Dade County. No management fees are included; hiring a professional manager is covered separately below.

Insurance and Airbnb Fees Consume Most of the Short-Term Rental Premium

The 80% gross revenue advantage that short-term rentals hold over long-term rentals erodes quickly once costs hit. The two largest culprits are Airbnb fees at about $9,300 per year (charged at 15.5% of gross bookings) and the higher insurance premium that short-term rental properties require, estimated at about $9,900 compared to about $8,400 for a long-term rental policy. Note that Airbnb's 15.5% host-only fee is specific to that platform; Vrbo charges roughly 5%, while Booking.com takes around 15%.

Property tax at about $5,300 is identical for both strategies (it is a property-level cost, not a rental-type cost), but short-term rentals also face Florida's tourist development tax at a rate of 6.0%, adding about $3,600 annually. Maintenance runs higher for short-term rentals at about $10,000 versus about $6,800 for long-term rentals, because the short-term figure includes furnishing replacement costs from guest wear. After everything, the net yield gap between strategies is modest: 2.7% for short-term versus 1.8% for long-term. In a premium market like Miami, that thin margin means the investment case leans heavily on property appreciation rather than cash flow alone.

A 2-Bed Apartment Costs Less to Enter but Adds HOA Fees

Apartments offer a substantially lower entry price in Miami-Dade County (about $245,000 versus about $751,000 for a house), but they introduce HOA fees that apply regardless of whether you rent short-term or long-term. Here is the full cost breakdown for a self-managed 2-bed apartment.

Lower Entry Price Helps Apartments, but HOA Fees Change the Equation

The apartment's entry price of about $245,000 is roughly a third of the house at about $751,000, which makes it far more accessible for investors entering the Miami market. That lower price point means that even modest rental income translates into a more competitive yield on a percentage basis. However, the addition of about $3,100 per year in HOA fees, which applies identically to both short-term and long-term rental strategies, partially offsets that advantage.

Compare the net yields directly: for short-term rentals, the house delivers 2.7% while the apartment achieves 4.5%. For long-term rentals, the house nets 1.8% versus 7.5% for the apartment. In both cases, the lower denominator (purchase price) works in the apartment's favor, even after absorbing the HOA cost that houses avoid entirely. For investors focused on cash-on-cash return rather than absolute dollar income, the apartment is worth serious consideration, particularly given that Miami's median 3-bed house price of about $751,000 sits well above both the Florida average of about $384,000 and the national average of about $243,000.

Short-Term Rental Gross Revenue Matches Long-Term Rent at 29% Occupancy

For the 3-bed house, the gross break-even occupancy (the point at which short-term rental gross revenue matches long-term rental income) is 29%. This is a floor, not a target. The market median occupancy across Miami-Dade County's 79 ZIP codes is 53%, which provides a comfortable margin above break-even. That said, occupancy varies significantly by neighborhood and season; Miami's tourism-heavy calendar means peak winter months can run well above the median while summer may dip below. Investors should stress-test their numbers at the lower scenario of 38% occupancy (producing roughly $43,000 in gross revenue) before committing.

View Miami in the dashboard → Free preview · every bedroom count and property type

Management Costs Eat Around 20% of Short-Term Rental Revenue

The tables above assume you handle everything yourself: guest communication, cleaning coordination, pricing, and maintenance calls. For investors who prefer a hands-off approach, hiring a professional short-term rental manager in the Miami market typically costs around 20% of gross revenue. For the 3-bed house, that adds roughly $12,000 in annual management fees, dropping the net yield to 1.0%. At that point, the case for short-term stays over long-term becomes considerably thinner on a pure cash-flow basis.

Long-term rental management is less expensive. Hiring a property manager for the 3-bed house adds approximately $3,200 per year (around 9% of rent), bringing the long-term rental net yield down to 1.4%. The operational burden of a long-term rental is lighter to begin with (no turnovers, no dynamic pricing), so many Miami investors self-manage long-term rentals while outsourcing short-term rental operations. For apartments, a long-term rental manager would add around $2,500 annually, which is proportionally similar but less in absolute dollars given the lower rent.

Florida's Tax Advantages Improve the After-Tax Picture

Florida has no state income tax, which means all rental income (both short-term and long-term) avoids the state-level tax bite that investors in states like California or New York face. Rental income is still subject to federal income tax and reported on Schedule E. The property's depreciable building value is estimated at about $557,000 (roughly 80% of the purchase price), producing an annual depreciation deduction of approximately $20,000 over the standard 27.5-year schedule. This paper loss can offset a significant portion of rental income for tax purposes.

Note that Florida does levy a tourist development tax on short-term rentals (reflected in the 6.0% rate above), and a state vacation rental license (DBPR license) is required. Initial licensing fees run to $600-$1,000 including the state license, local business tax receipt, resort tax registration, and certificate of use. Rules vary across Miami-Dade County: most of the county permits short-term rentals, but Miami Beach (5 ZIP codes) prohibits them in residential zones, allowing them only in certain commercial and tourist districts. Investors must verify that short-term letting is permitted at the specific property address before purchasing. Transaction costs (closing costs, title insurance, and transfer taxes) also apply at purchase but are excluded from the annual operating tables above; consult a local real estate attorney for current figures. Explore the full rental data for Miami-Dade County in the dashboard to model these scenarios with your own assumptions.

A Premium Market Where Appreciation Does the Heavy Lifting

Miami's net yields, whether 2.7% for a short-term rental house or 1.8% for a long-term rental, are modest by national standards. The national median gross long-term rental yield is 5.3%, and Miami's gross of 4.8% sits in a similar range, but the high absolute property price of about $751,000 compresses net returns. This is characteristic of premium markets: investors accept lower current income in exchange for capital appreciation potential and the relative stability of a deep, liquid real estate market.

For context, the Florida state median house price is about $384,000, making Miami-Dade significantly more expensive than the typical Florida market (about $751,000 versus the state median of about $384,000). Investors seeking higher cash-flow yields within Florida might look at markets like Key Largo (Monroe County), where entry prices are lower and gross yields are stronger. However, Miami's tourism infrastructure, international demand, and population growth underpin a fundamentally different risk profile. The right comparison is not Miami versus a rural Florida county; it is Miami versus other global gateway cities, where similar yield compression is the norm. You can compare Miami's numbers against other Florida markets using our market score methodology.

Data reflects market conditions as of May 2026. For details on how these figures are calculated, see our data sources documentation.

This information is for educational purposes only and should not be considered financial or legal advice. Regulations and market conditions change frequently. Verify current rules with local authorities before making investment decisions.