When people see a home turned into an Airbnb, it’s easy to assume that the owner chose short-term rental over a long-term tenant or a traditional flip. In reality, for this Belleville property, Airbnb wasn’t the most profitable option, it was the only option that worked at all.
Let’s look at the numbers of a property we purchased in Belleville, Illinois.
The home was purchased for $50,000 and required a full rehabilitation costing roughly $100,000. All in, that puts the total investment at $150,000. After the renovation, the property’s after-repair value was approximately $165,000.
On paper, that already tells you why this project sat untouched for so long.
A flipper relies on meaningful spread between total cost and resale value. Here, that spread is only about $15,000—and that’s before factoring in holding costs, financing, closing costs, or realtor commissions. In practice, this would likely be a break-even deal or a loss. And it’s worth noting that our rehabs are not luxury flips; they are designed to be durable and attractive, but not over-improved. A traditional flipper would likely spend more and make the numbers even worse.
Long-term rental doesn’t solve the problem either.
In this neighborhood, market rent is roughly $1,500 per month, if the place is really nice. That level of rent does not support the cost of a $165,000 property once you account for a mortgage, taxes, insurance, maintenance, vacancy, and management. As a long-term rental, this property would likely operate at a loss. That’s why investors don’t line up to rent these homes out—and why they remain vacant.
Short-term rental changes the equation.
As an Airbnb, the property generates approximately $2,500–$3,000 per month, with the possibility of more in the busy season. That additional income is what makes it possible to justify the renovation, maintain the home properly, and keep it occupied. Without that revenue, the rational investment decision would have been to wait—hoping for higher rents, higher values, or a cheaper acquisition price—further extending the vacancy.
And vacancy isn’t neutral. Vacant homes deteriorate, depress nearby property values, and discourage reinvestment. Airbnb doesn’t replace housing here; it creates viability where none existed.
There’s also a direct benefit to the city.
Belleville collects an 8% lodging tax on short-term rental revenue. With roughly 50 Airbnbs in the city and a conservative estimate of $2,500 per month per property, that’s about $1.5 million in annual revenue, generating roughly $120,000 per year in lodging tax alone. That doesn’t include increased property taxes from renovated homes, sales tax from visitors spending locally, or the ripple effects of rising nearby home values.
Those dollars fund city services and improvements without increasing taxes on residents—and they exist only because these homes were made habitable again as an Airbnb/short-term rental.
This is why context matters so much in the Airbnb debate.
In cities with high prices and limited supply, short-term rentals can remove housing from an already strained market. In cities like Belleville—where values are lower, rents are modest, and renovation costs are high, Airbnb often becomes the only tool that makes reinvestment possible.
The choice isn’t between Airbnb and long-term housing.
It’s between Airbnb and continued vacancy.
The numbers make that clear.