The short-term rental/STR industry will expand to roughly 650,000 actively rented units in the US this year, equal to 12.2% of US hotel-room supply, as the fast-growing sector further expands in suburban, rural and resort markets, according to a new report from CBRE.

CBRE's analysis of data on short-term rentals shows that the industry's growth rate overall is beginning to cool off to an expected year-over-year increase of 19% this year, down from 26% in 2019 and 39% in 2018. Part of that is the effect of growing from an increasingly larger base. Another factor, however, is that some STR growth has shifted outside of big urban markets that are at or near saturation.

The major metropolitan areas of Texas rank in the top 30 largest US hotel markets for STR penetration, but the extent varies by metro. Austin has an 18% penetration, San Antonio is at 6.3%, Houston is at 4.8%, Dallas at 4.4% and Fort Worth at 3.7%.

CBRE experts say the Houston and Dallas markets will continue to grow but are expected to level off in the near future. Hotel owners across the state are keeping a close eye on the STR market as it relates to rates, revenue and STR's growing market share of business travelers.