Why STR calculators overestimate revenue
If you have run the same property through several STR calculators and gotten wildly different numbers, you are not imagining it. Many tools overestimate. Here is why, and how to think about it.
Optimistic defaults
Default occupancy and nightly rates are often set at the high end. Peak-season or top-performer data gets treated as typical. Small changes in those assumptions swing the outcome a lot. A calculator that assumes 70% occupancy and $200/night will look very different from one that assumes 55% and $160.
- Use conservative inputs, or use a tool that caps optimism and shows you a range.
Data lag and sampling bias
Scraped or self-reported data can be stale. Listings that are no longer active, or that were booked months ago at old rates, still show up in comps. Survivorship bias: the listings you see are often the ones that perform well. The ones that failed or sat empty are not in the sample.
We do not claim perfect market data. When something is unknown, we say so and apply conservative defaults.
Seasonality treated as year-round
Many tools take peak-season performance and imply it holds all year. In seasonal markets, slow months can be 30–50% below peak. Underwriting on peak alone makes the deal look better than it is. For more on this, see our STR seasonality reality check.
Stress-test for a weak year and for the slow months. If the deal only works in the best months, it is fragile.
Expenses understated
Cleaning, management, utilities, STR insurance, maintenance, and reserves add up. Some calculators use bare-bones expense assumptions. Real-world costs are higher. We build in realistic expenses and tell you what we assumed. For what breaks first when margins are thin, see the STR fragility checklist.
No downside scenario
A single point estimate does not tell you what happens in a weak year or when occupancy drops. You need ranges and stress tests. We show strong, typical, and weak year outcomes so you can see where the deal breaks.
What to do instead
Use a conservative reality check before you buy. Run your numbers through underwriting that caps optimism, shows downside scenarios, and gives you a clear verdict. See the sample report for what that looks like, or run your deal.