Gross Revenue

Gross revenue is the total income generated from short-term rental bookings before deducting any expenses, fees, or taxes. It is the sum of every dollar a guest pays — nightly rates, cleaning fees, pet fees, and extra-guest charges — making it the top-line figure that every other financial metric for an STR property builds upon.

Key Takeaways

• Gross revenue = nightly revenue + cleaning fees + all ancillary guest charges; no expenses deducted
• It is the starting point for calculating NOI, cap rate, and cash-on-cash return
• AirROI data shows US market medians ranging from $27,540 (Denver) to $53,472 (San Diego) in trailing 12-month annual gross revenue
• Gross revenue is driven by two levers: ADR (pricing) and occupancy rate (volume)
• Never confuse gross revenue with net revenue — platform commissions, cleaning costs, and operating expenses are excluded from gross

How to Calculate Gross Revenue

The formula is straightforward:

Gross Revenue = Nightly Revenue + Cleaning Fees + Ancillary Fees

In practice, every line item on a guest's booking confirmation contributes to gross revenue.

Example — monthly calculation:

Component	Amount
Nightly revenue (22 nights × $185 avg)	$4,070
Cleaning fees (8 bookings × $120)	$960
Extra guest fees	$210
Pet fees	$75
Gross Revenue	$5,315

This $5,315 is your gross revenue for the month. Multiply similar months across a full year to arrive at annual gross revenue, which is the figure investors, lenders, and platforms use to evaluate an STR property's income potential.

Annual Gross Revenue Across US Markets

Revenue varies dramatically by location. The chart below compares AirROI's trailing-12-month median annual gross revenue per active listing across seven markets from the basket.

In AirROI's analysis of more than 43,000 active listings across these seven markets, San Diego leads at $53,472 in annual gross revenue, followed by Gatlinburg, TN ($50,438) and Scottsdale, AZ ($49,153). Denver sits at the lower end with $27,540 — not because listings underperform, but because Denver's ADR ($221.50) is substantially lower than San Diego's ($394.90). Volume alone cannot compensate for a 78% gap in nightly rate.

Gross revenue is as much a pricing story as a booking story — two markets with identical occupancy rates can differ by $25,000 in annual income purely because of ADR.

Gross Revenue vs. Net Revenue

The distinction matters most when evaluating investment returns. Gross revenue is the top line; net revenue (or net operating income) is what you actually keep.

Metric	What it includes	Excludes
Gross revenue	All guest payments	All expenses
Net revenue	Gross revenue minus operating costs	Mortgage payments
Net operating income (NOI)	Revenue minus all operating expenses	Financing costs

For a typical STR, operating expenses — Airbnb host fee (~3%), cleaning, supplies, management, insurance, and maintenance — absorb roughly 40–55% of gross revenue. The remaining 45–60% is NOI, which flows into cap rate and cash-on-cash return calculations.

What Drives Gross Revenue

Gross revenue has two structural levers and one ancillary channel:

1. Average Daily Rate (ADR) The single highest-leverage variable. San Diego's $394.90 ADR is the primary reason it outpaces Denver's $221.50 market by $25,932 in annual gross revenue despite similar trailing-12-month occupancy profiles. Disciplined ADR management — including dynamic pricing that captures demand spikes without capping occupancy — is how top operators grow gross revenue without adding inventory.

2. Occupancy Rate At 53% occupancy, San Diego listings produce income on 194 nights per year. Closing that gap by even 5 percentage points adds roughly $3,700 in nightly revenue at San Diego ADR. Reducing minimum-night requirements during soft periods and offering gap-night discounts are the fastest structural fixes.

3. Ancillary fees Cleaning fees, pet fees, early check-in, and late checkout charges are pure gross revenue that platforms do not discount. A $120 cleaning fee on 60 annual bookings is $7,200 added to the top line — real money that the nightly rate alone would never capture. Pet-friendly listings that add a $75–$150 pet fee generate meaningful ancillary revenue at minimal cost.

Gross Revenue Benchmarks by Market Type

The table below reflects AirROI trailing-12-month medians for all active listings by market archetype:

Market archetype	Annual gross revenue range	Notes
Coastal vacation (San Diego)	$50,000–$65,000+	High ADR, moderate occupancy
Resort/cabin (Gatlinburg, Scottsdale)	$44,000–$55,000	Dual-season demand, strong ancillary
Entertainment cities (Nashville, Miami, New Orleans)	$34,000–$45,000	Event-driven peaks, competitive supply
Mountain/urban (Denver)	$25,000–$32,000	Lower ADR, steady year-round bookings

City-wide medians include every listing — well-managed properties in strong locations consistently beat the median. The STR investment analysis guide walks through how to model individual property gross revenue before acquisition.

Why Gross Revenue Matters Beyond Cash Flow

• Lender underwriting: Most DSCR lenders use projected STR gross revenue (discounted by a vacancy factor) to determine loan eligibility and sizing. Higher gross revenue directly supports a larger loan.
• Property valuation: The income approach values an STR as NOI ÷ cap rate. Because NOI derives from gross revenue, every dollar of top-line income improvement compounds into property value.
• Performance benchmarking: Comparing your annual gross revenue to market medians — available in AirROI's Atlas — reveals whether you are outperforming or underperforming comparable listings.
• Tax basis: Gross rental income is the starting point for Schedule E reporting, QBI deductions, and depreciation calculations. Accurate gross revenue tracking is a compliance requirement, not just a performance metric.

Hosts who track gross revenue monthly and compare it to RevPAR gain a complete picture: RevPAR normalizes for available nights (exposing occupancy gaps), while gross revenue captures the absolute dollars entering the business. The AirROI income calculator guide demonstrates how to build both metrics into a single projection model.