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The Complete Guide to Nashville Short-Term Rental Investments: What Every Buyer Should Know in 2025

Nashville's short-term rental market continues to attract investors from across the country, drawn by our city's booming tourism industry and strong rental demand. However, navigating the regulatory landscape and finding the right investment property has become increasingly complex. Here's everything you need to know about investing in Nashville STRs in 2025.

The Regulatory Reality: Why Location Matters More Than Ever

Since 2017, Nashville's approach to short-term rentals has fundamentally changed. The Metro Council voted to prohibit new non-owner occupied STR permits in R and RS zoned neighborhoods—which encompasses the majority of Nashville's residential areas. This means you can't simply buy any house or condo and convert it to an Airbnb.

The Two-Permit System:

  • Type 1 (Owner-Occupied): You live in the property and rent out rooms or portions
  • Type 2 (Non-Owner Occupied): Entire properties rented short-term (NOO STRs are heavily restricted in residential areas)

New Type 2 permits are now only available in commercially zoned areas, creating a significant supply constraint that has reshaped the entire market.

Why Most Condos Won't Work for STR Investors

One of the biggest misconceptions among potential investors is that any condo can become a short-term rental. The reality is much more restrictive.

High-Rise Reality Check: No downtown Nashville high-rise condo buildings allow short-term rentals. Buildings like Viridian, ICON, Encore, and others restrict owners to minimum 12-month leases and typically limit rental permits to just ~20% of total units. While you might see some Airbnb listings in downtown high-rises, these are usually master-leased apartment units, not individually owned condos.

HOA Restrictions: By default, most HOA bylaws require any tenants to sign leases for a minimum of six to twelve months. This automatically eliminates short-term rental possibilities unless the HOA specifically allows it.

Where the Opportunities Actually Exist

Purpose-Built STR Developments

After the 2017 rule changes, developers responded by creating communities specifically designed for short-term rentals. These developments are:

  • Properly zoned from the start
  • Built with STR-friendly HOA bylaws
  • Designed to maximize rental income potential

Nashville STR-Friendly Developments

Purpose-Built STR Communities:

  • Alabaster West
  • Alloy 
  • Archer At 12th
  • Aspire
  • Avery - flats in Inglewood
  • Axis27 - 27th Avenue townhomes
  • Baptist World Center Drive - Madison
  • Bongo - at Alloy
  • Boomerang - the Nations
  • Bradford Flats - Near airport location
  • Brio - West End
  • Catalyst Vanderbilt
  • Charlotte Park - townhomes
  • City Bluffs - historic Buena Vista
  • City Heights - townhomes
  • Cityview South - fairgrounds area
  • Crave - Charlotte Avenue
  • Crescendo - Music Row
  • East Nashville Suites
  • The 1865 - historic conversion
  • Elevate at City Heights - 31st Avenue North
  • Elliott
  • Endeavor at City Heights - Clifton Avenue: Mix of studios to 3BR
  • Eve
  • 5612 Live Work
  • Harmony Heights
  • Harold and Owen - Music Row
  • Haysboro
  • Hendrix - Cleveland Park
  • Heritage - at Broadway (historic downtown conversion now pre-selling!)
  • Heritage at Jefferson - townhomes
  • Highland Station
  • Horizon - River District: 19 luxury townhomes, 4BR/4BA
  • Hudson Row - Near Oracle campus: 9 townhomes, 4BR/4BA
  • Hydes Ferry Hideaway - Bordeaux 
  • Hyve
  • Illume - South Street: 77 condo units
  • Inglewood Lofts 
  • Jolene - East Nashville
  • Lofts At 30th
  • Lofts On 44th Avenue
  • Lyric Cleveland Park - 50 townhomes (3-4BR)
  • Magnolia - Germantown
  • Mason Avenue - townhomes
  • Mason Lofts - West End: 14 furnished condos (1-4BR)
  • Meharry Boulevard Townhomes 
  • Metro North
  • Moderno
  • Monty
  • Muse Nashville - Downtown: 55 units (studio to 3BR)
  • Musica - Music Row: 13 townhomes near Vanderbilt, 4BR
  • Myrtle Street Townhomes
  • Nations, The
  • Nines At Wedgewood Townhomes
  • Neo - Hermitage Avenue near downtown
  • New Cumberland
  • Niche - Madison area
  • 941 Main - East Nashville
  • North View - 24th & Hyde
  • Odyssey at the Park - West End, 75-unit community
  • Pinnacle at Fern 
  • Raven
  • Revel - The Nations: 5 furnished townhomes, 4BR/3.5BA
  • Richardson - Ingwood area
  • Riverside Station - near Shelby Bottoms
  • Rudy - at City Heights
  • Scovel Row
  • 1701 Portland - Hillsboro Belmont townhomes
  • 6Teen On Central - in Hermitage, TN
  • Sky At Fern 
  • Skyline
  • Skyview
  • Solaris
  • South Gulch
  • Starlet - Cleveland Park: Condos and townhomes
  • Toll Brothers - at The Nations
  • Townhomes at Greenwood - East Nashville
  • Third & Taylor - Germantown
  • 24th & Hyde Townhomes
  • Vibe East Nashville - Trinity Lane: Townhomes
  • Vistas at Katie Hill - Near Oracle campus: 5 townhomes, 4BR/4BA
  • Volta - Inglewood area
  • Wade Avenue Townhomes
  • Wedgewood Townhomes 
  • WestVue - Townhomes with downtown views
  • White Avenue Flats - Berry Hill area

Legacy Condo Buildings (Modified Bylaws):

  • Spence Manor - Modified bylaws to allow STRs
  • Riverfront Condos - STR-approved building
  • The Quarters - Allows short-term rentals
  • Studio 1 - Modified for STR use
  • Ambrose - Modified for STR use
  • Watauga 

Note: Availability and pricing vary significantly. Many developments sell out quickly or trade privately. Small one and two-unit new construction projects sometimes arise in commercially zoned areas. Contact us below to be notified of opportunities.  

Recent Market Developments and Investment Considerations

The STR market has evolved significantly over the past several years. Key trends include:

Price Evolution: STR developments now range from luxury properties over $1M to more affordable options, depending on location and amenities.

Location Patterns: Developments cluster near major employment centers, entertainment districts like Music Row and The Nations, and areas with strong tourism appeal.

High Demand: Many purpose-built STR developments experience strong sales, indicating continued investor confidence in the Nashville market.

The Investment Case for Nashville STRs

Despite regulatory complexities, Nashville remains attractive for STR investors because:

Strong Tourism Fundamentals: Nashville's music scene, professional sports teams, and events like CMA Fest drive consistent demand year-round.

Higher Returns Potential: Properly located short-term rentals often generate significantly higher returns than traditional long-term rentals.

Repeat Guest Advantage: Data shows Nashville Airbnb guests are three times more likely to return within 12 months and seven times more likely to refer friends.

Critical Due Diligence Points

Before investing in any Nashville STR property, verify:

  1. Zoning Compliance: Ensure the property is in a commercially zoned area that permits non-owner occupied STRs
  2. HOA Approval: Confirm the homeowners association specifically allows short-term rentals
  3. Permit Status: Verify current permits are in place and is transferable or purchasable as an LLC. 
  4. Management Requirements: Factor in the hands-on nature of STR management or professional management costs

Looking Ahead: Market Outlook

The Nashville STR market shows no signs of slowing down, but successful investing requires more sophistication than ever. With limited new supply and strong demand, well-located properties in properly zoned developments continue to perform well.

However, the days of finding bargain properties that can be easily converted are largely over. Today's successful STR investors focus on purpose-built developments or rare resale opportunities in established STR-friendly buildings.

Working with STR Specialists

Given the complexity of Nashville's STR regulations and limited inventory, working with agents who specialize in this niche is crucial. The regulatory landscape continues to evolve, and having expert guidance can mean the difference between a profitable investment and a costly mistake.

Whether you're a first-time STR investor or looking to expand your portfolio, understanding these market dynamics is essential for making informed decisions in Nashville's unique short-term rental landscape.


Looking to invest in Nashville short-term rentals? Our team stays current on the latest developments and regulatory changes. Contact us to discuss your investment goals and explore current opportunities in this specialized market.


Ask Us About STR Opportunities in Nashville

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