Airbnb in Nashville: Why It’s Not As Profitable As It Used to Be

For years, Nashville was a goldmine for Airbnb hosts. The city’s booming tourism, lively music scene, and Southern charm made it one of the most popular short-term rental markets in the U.S. Investors flocked in, buying up condos, bungalows, and new builds to cash in on Music City’s visitor economy.

But in 2025, the story has changed. Airbnb in Nashville just isn’t as profitable as it once was—and the reasons are becoming hard to ignore.

A Flood of New Listings

Between 2018 and 2022, Nashville saw a massive increase in Airbnb listings. Developers got wise to the demand and began building entire apartment complexes marketed specifically for short-term rentals. Investors followed suit, snatching up units in STR-permitted zones like The Nations, East Nashville, and downtown’s Gulch district.

Today, the city is flooded with thousands of short-term rental options, many offering similar layouts, amenities, and aesthetics. With such an oversupply, it's harder than ever to stand out—and even harder to keep rates high.

Price Wars and Slashed Profits

The result of this saturation? Price competition.

To keep calendars full, hosts are cutting nightly rates, offering discounts, and upgrading units with expensive decor and tech. A downtown condo that once fetched $300 a night in peak season might now go for $175 or less—while cleaning costs, service fees, and maintenance have all stayed the same or increased.

Even properties near hot zones like Broadway or 12 South are seeing declining margins.

Regulations Are Tightening

Metro Nashville has taken steps to regulate short-term rentals more strictly. Non-owner-occupied permits in residential zones have been banned in many areas. Hosts now need to navigate permit renewals, zoning restrictions, and a watchdog city council that’s cracking down on unlicensed operators.

Failure to comply can result in steep fines—or a complete loss of STR income.

In addition, the state has given cities more authority to regulate STRs, and Nashville has already shown it's not afraid to use it.

Higher Operating Costs

Let’s not forget: hosting in Nashville isn’t cheap. From professional cleaning crews and rising utility bills to security systems and guest amenities, it all adds up. And with guest expectations at an all-time high—think luxury linens, themed interiors, and Instagram-worthy backdrops—the upfront investment is growing.

Hosts are spending more to compete, yet seeing less return.

Long-Term Rentals Are Making a Comeback

Given all the friction, many property owners in Nashville are re-evaluating the short-term model. Long-term rentals are starting to look more attractive: lower turnover, consistent income, and fewer regulatory headaches. With the city’s growing population and steady demand for housing, renting to long-term tenants can be a safer, more sustainable play.

Should You Still Airbnb in Nashville?

If you're thinking about jumping into the Airbnb game in Nashville now, know this: it's no longer a low-risk, high-reward venture. The city is oversaturated, regulations are strict, and guest expectations are higher than ever.

To succeed, you’ll need:

• A unique and well-located property

• A clear understanding of local STR laws

• A detailed, realistic financial plan

• A willingness to operate like a professional hospitality business

Final Thoughts

Nashville is still a top-tier destination—but that doesn’t automatically translate to STR profits anymore. The easy money has dried up. If you’re not already established with a great location and a solid strategy, the Airbnb market here might not be worth the hype.

Sometimes, the best move isn’t to chase nightly rates—it’s to find long-term stability in a market that still has plenty of demand for year-round housing.

Want help analyzing your Nashville property’s potential as a short-term or long-term rental? Let’s connect—I can walk you through what makes the most sense in today’s shifting market.