The market research firm AirDNA currently rates Evanston as a “Great” market for vacation rental operators.
It says Evanston has:
- Growing demand for vacation rentals, with an occupancy rate of 62%, up 1% over the past year.
- Increasing revenue per occupied rental night, up 3% in the past year to an average of $192.
- With relatively steady demand through the year, revenue per available rental night is up 9% in the past year to $120.50.
- The median annual revenue for a vacation rental property in Evanston is up 7% to $43,700 per year.
What are the downsides? Air DNA identifies those as a relatively strict regulatory climate, and — worst of all — very high mortgage costs compared to the revenue a property is likely to generate.
That makes it relatively unattractive for investors to buy a property with the goal of turning it into full-time a vacation rental, and more likely that most operators live in the property themselves part of the year.
Here’s a sampling of data from properties listed on AirDNA — none of which are listed by the City of Evanston as having vacation rental licenses:
- 120 Dempster St. — Luxury price tier — “Stunning beach house, steps from Lake Michigan” — earned $342,000 in the last 12 months with an occupancy rate of 62% for 280 available days.
- 1617 Florence Ave. — Midscale price tear — “Stunning home – 20 mins to Chicago!” — earned $66,000 in the last 12 months with an occupancy rate of 93% for 107 available days.
- 1590 Elmwood Ave. — Upscale price tier — “Luxury apartment in Evanston w/ rooftop, gym” — earned $2,100 in the last 12 months with an occupancy rate of 44% for 52 available days.
Despite AirDNA labeling the Evanston vacation rental market “great,” it appears the number of vacation rentals here now is only slightly higher than the number before the COVID-19 pandemic.
Of the current 218 listings shown in the chart, 65 are in ZIP code 60203 in Skokie and about 20 in Evanston have minimum rental periods greater than 30 days, and so are exempt from the city’s vacation rental licensing ordinance.
That leaves about 134 “true” vacation rental listings in the city — or less than half of one percent of the more than 30,000 housing units in Evanston.
Part Three: What next for vacation rentals here?
Part One: Vacation rental licensing: Why bother?
Update 9/30/23: Greg Van Ert, who with his wife owns 120 Dempster St., says AirDNA’s info about his property is wildly exaggerated.
He says they rent the house out for vacation rentals no more than 15 days per year and showed Evanston Now a 1099-K tax statement from Airbnb showing they made a small fraction of the revenue in 2022 that AirDNA claims they did.