I have seen the future and it is not STR (for the most part).

[Ken Latchers]

There is something called an efficient market (well known in stocks and commodities).  That is where there is no easy money to be made, as everything is priced so no one has an advantage.

Then there is the mania.  For traders, the Dutch Tulip crisis centuries ago.  People kept bidding up the price of special tulips, investing everything, and then the crash wiped out many.  Roaring 20s and Great Depression anyone?

Doom comes ever closer.

Eager beavers are pouring into the STR remarket. They get excited. They want to buy as many properties as possible. They read a book! They read a few posts here! They want to arb. They want to scale. They ask how much WILL they make (as if their market cannot get saturated in the future). Can I retire with 4 of these properties?? Yowza. I'm so excited. And I just cant hide it. I'm about to lose control and I think I like it! Occupancy can plunge and rates forced down. That is the meaning of an efficient market.

Regulatory restrictions in cities, moving to towns, moving to the country.  Our small "country" town is now investigating restrictions - and has been considered one of the permissive/supportive of short term rentals historically - it came out of nowhere.  They are actually discussing requiring ONE PARKING SPACE PER BEDROOM.  Like Bed and Breakfasts.  Of course most houses here are on small lots and have no such space!  This may became a small tidal wave.

Doom comes ever closer.

There are a few companies (whose name escapes me) getting into building or controlling vacation rentals. Hotel chains are getting into it. This is the tip of the iceberg. When REIT and other companies really decide that the possibility of 15-20% return outweighs the struggles with the stock and bond market, it will turn into a tsunami. Occupancy can plunge and rates forced down. That is the meaning of an efficient market.

The expansion may have reached its end. The Trade Wars and a lot of other things are starting to wear on this economy.

Doom comes ever closer.

Consider Hades.  Consider the "safer" places with a long history of vacation rentals that will likely stay that way.  But your brilliant purchase of a $750K house may make more money as a landlordly endeavour.  If you have 20 arbs cleverly arranged at market rent for 5 years, welcome to the "Wall Street Lays an Egg" scenario.