Top 5 Hudson Valley Towns for Short-Term Rental ROI Right Now

Not all Hudson Valley towns are created equal when it comes to short-term rental returns. Some offer strong demand and investor-friendly regulations. Others have hit permit caps, banned non-owner-occupied rentals entirely, or introduced enforcement with real financial penalties.

If you're an NYC-based investor evaluating where to buy — or trying to understand how your current market stacks up — this guide breaks down the best Hudson Valley towns for STR ROI right now, based on demand, regulatory environment, and revenue potential.

What Makes a Hudson Valley Town Good for STR ROI?

Before diving into the list, it helps to understand what separates a high-ROI market from a mediocre one. The key factors are:

• Demand drivers — proximity to nature, hiking, skiing, or cultural attractions that generate year-round bookings

• Regulatory environment — towns with clear, manageable permit requirements beat those with caps, bans, or heavy enforcement

• Supply-demand balance — fewer active listings relative to demand means less competition and stronger pricing power

• Accessibility — drive-to markets within 2 hours of NYC consistently outperform more remote locations

• Seasonality — towns with multiple demand seasons (summer + fall foliage + winter skiing) generate more consistent annual revenue than single-season markets

With those filters in mind, here are the five towns that stand out right now.

1. Kerhonkson — The Investor's Best-Kept Secret

Kerhonkson has quietly become one of the strongest STR markets in the Hudson Valley — and one of the most investor-friendly. Located in Ulster County near Minnewaska State Park and the Shawangunk Ridge, it draws outdoor enthusiasts year-round for hiking, rock climbing, and nature escapes.

What makes Kerhonkson stand out is the combination of strong demand and a relatively open regulatory environment compared to nearby towns. While Woodstock and Kingston have hit permit caps, Kerhonkson still offers entry points for new investors.

Property prices remain more accessible than in trendier towns, which means better cap rates for buyers who move now before the market catches up to its fundamentals.

Best for: Investors seeking strong ROI with lower entry costs and manageable competition.

2. Saugerties — Steady Demand, Strong Fundamentals

Saugerties sits at the intersection of the Hudson River and Catskill Creek, offering a mix of charming village appeal and easy access to both the Catskills and Hudson Valley wine country. It's consistently one of the most booked markets in the region, with demand that holds up across seasons.

The town has a visible STR presence on Airbnb and Vrbo with strong review scores, suggesting guests are having good experiences — a positive signal for new listings entering the market. Regulatory requirements are manageable compared to harder markets like Woodstock.

Saugerties also benefits from proximity to events in nearby Hudson and Kingston, creating micro-demand spikes throughout the year that well-managed listings can capture.

Best for: Investors who want a proven, stable market with year-round demand and lower regulatory risk.

3. Catskill — Emerging Market With Real Upside

The town of Catskill has been quietly gaining traction as an STR destination, and the data is starting to reflect it. According to Airbtics, a typical STR listing in Catskill generates around $32,000 annually with a 51% median occupancy rate and an average daily rate of $158 — respectable numbers for a market that's still in growth mode.

Catskill's appeal is its blend of Hudson Valley charm, proximity to the Catskill Mountains, and a revitalized arts and dining scene that's attracting a new wave of weekend visitors from NYC. Property prices are still below the peak levels seen in Woodstock or Rhinebeck, which creates an opportunity for investors to enter before appreciation catches up.

With a relatively light regulatory touch compared to more established markets, Catskill is one of the better places to get in early.

Best for: Investors looking for an emerging market with below-average entry costs and room to grow.

4. Stone Ridge — Boutique Appeal, Premium Rates

Stone Ridge punches above its weight in terms of average daily rates. It's a quieter, more residential market — which means lower listing volume and less competition — but the guests it attracts are willing to pay for the right property.

Located in the heart of Ulster County, Stone Ridge draws a discerning NYC crowd looking for privacy, design-forward properties, and a slower pace. The town doesn't have the same foot traffic as Woodstock or Saugerties, so success here is more dependent on listing quality, professional photography, and strong guest experience management.

For investors who own or are considering a well-appointed property and want to target the premium end of the market, Stone Ridge offers strong ADR potential with relatively limited competition.

Best for: Investors with higher-end properties targeting premium rates and a curated guest experience.

5. Hunter — The Winter Wild Card

Most Hudson Valley STR markets are summer-dominant. Hunter is the exception. As the home of Hunter Mountain — one of the most accessible ski resorts for NYC day-trippers and weekend travelers — Hunter generates strong January and February demand that most other Hudson Valley towns simply don't have.

That winter demand creates a revenue diversification opportunity. Properties in Hunter that are well-positioned for skiing in winter and hiking or leaf-peeping in fall can achieve year-round occupancy that's hard to match elsewhere in the region.

The trade-off is that Hunter is more seasonal in its peaks — the summer shoulder season is softer than in towns closer to the Hudson River. Investors should model their revenue assumptions across all four seasons before committing.

Best for: Investors who want exposure to ski season demand and are comfortable with a more variable seasonal revenue profile.

The Towns to Approach With Caution

Not every popular Hudson Valley town is a smart investment right now. Woodstock and Kingston have both hit their non-owner-occupied permit caps, making it nearly impossible to operate an investment property legally without purchasing one of the rare transferable permits. Rhinebeck bans unhosted rentals entirely.

These markets may still work for owner-occupied or house-hacking scenarios, but pure investment buyers should do their regulatory due diligence before purchasing in any of these towns.

Thinking about buying or already own a short-term rental in the Hudson Valley? We help investors across Kerhonkson, Saugerties, Catskill, and beyond maximize their returns through professional co-host management. Contact us for a free revenue estimate.