Nashville STR Market Update: What the Numbers Say in 2025

The State of Nashville STR in 2025

The Nashville short-term rental market has undergone significant structural changes since the passage of BL2022-1144. Supply has tightened in residential zones, but demand — particularly around major events, healthcare visits, and tourism — remains strong. The result is a more complex market with higher variance across neighborhoods and property types.

Occupancy & Rate Trends

Based on market data through early 2025:

• Downtown & SoBro: Occupancy rates averaging 68-74%, ADR holding near $180-220 for well-positioned 1-2BR units. Competition from new hotel inventory is a headwind.
• East Nashville & Germantown: Stronger organic demand, occupancy 72-78%, ADR $160-200. Permit supply is constrained, giving existing operators a relative advantage.
• Antioch & outer zones: Softer occupancy (55-65%), more price-sensitive travelers. These properties face the greatest risk-reward pressure under current regulations.

The Permit Supply Effect

With no new NOO permits available in R zones, the total inventory of legally-operating non-owner-occupied STRs in Nashville is slowly declining as some operators exit or lose permits at renewal. For compliant operators in high-demand areas, this supply contraction can support rates. For those in marginal locations, it does not offset the regulatory risk.

What This Means for Owners

The 2025 Nashville STR market rewards two types of operators: those with strong permit positions in high-demand neighborhoods, and those who have already pivoted to mid-term or long-term rental models that sidestep the regulatory risk entirely. Owners caught in the middle — marginal locations, uncertain permit positions — face the most difficult decisions.

The Bottom Line

Data alone won't tell you what to do with your specific property. Your permit status, your neighborhood's MTR demand, your cost basis, and your risk tolerance all factor into the right decision. That's why a property-specific audit — not a market-level overview — is the right starting point for 2025 planning.