I get the call almost weekly. A California investor — sometimes a family, sometimes a small real estate fund, sometimes a Bay Area tech operator with a side bet — has been running Teton Valley numbers in a spreadsheet, sees the gross revenue figures on AirDNA, and wants to know if those numbers actually pencil out for a build or remodel.
The short answer is: sometimes yes, sometimes no, and the spreadsheet you ran is almost certainly wrong in at least two places. I’m Bryce Swager. I build custom homes and remodel rentals in Teton Valley. This is the honest version of the ROI conversation.
The bigger picture: Teton Valley as an STR market
Teton Valley is one of the most desirable secondary-market vacation rental zones in the Mountain West — close enough to Jackson Hole to feel like the Tetons, cheaper than Jackson to buy into, serves both ski-season and summer demand, and growing in cultural cachet for Bay Area and Denver families. The market also has real constraints California investors routinely underestimate:
- STR regulatory environment is different in Driggs vs. unincorporated Teton County vs. Victor. Different rules. Different licensing. Don’t assume.
- ADR is highly seasonal — peak weeks (Christmas/New Year, Presidents Week, MLK, summer July weeks) carry the year. Shoulder seasons drag heavy.
- Occupancy ceilings are lower than Joshua Tree or Park City — fewer year-round demand drivers.
- Property management in a small market costs more in percentage terms than larger markets.
- Construction cost per square foot is meaningfully higher than the comps you’ll see in lower-elevation Idaho.
STR regulations — the actual rules in Driggs, Victor, and unincorporated Teton County
This is the single most important section of this post. Don’t buy a property assuming you can short-term-rent it without checking. STR rules in Teton Valley have tightened in recent years and continue to evolve.
If you’re building from California: verify STR allowances on the specific parcel, in writing, before you close. Realtors are not the source of truth here. The municipality is.
City of Driggs. Driggs has an active short-term rental licensing and inspection program. STRs are typically permitted in certain zones with a license, life-safety inspection, and registration. City of Victor. Victor has its own STR ordinance and permitting process, with different rules from Driggs. Unincorporated Teton County. Teton County, Idaho regulates STRs separately. Some subdivisions also restrict STRs at the HOA / CC&R level — even if county rules allow them.
The pattern California investors get burned on most often: an HOA in an otherwise STR-permissive zone bans STRs in their CC&Rs, the realtor didn’t flag it, and the buyer closes without reading the CC&Rs. Always do all three checks: city/county ordinance, HOA CC&Rs, and any applicable zoning overlay. In writing. Before closing.
ADR, occupancy, and gross revenue — what the data actually shows
| Metric | Realistic range | Notes |
|---|---|---|
| ADR (annual average) | $300–$550 | AirDNA / Mashvisor Teton Valley |
| Peak-week ADR | $700–$1,500+ | Holiday weeks, Presidents Week, prime summer |
| Shoulder ADR | $180–$320 | April–May, October–early December |
| Annual occupancy | 45%–62% | Top operators hit 65%+ |
| Gross annual revenue | $80K–$220K | Wide range; depends on size, finish, location, ops |
| Top-decile gross | $250K–$400K+ | Larger 4–6 bed, premium finish, hot-tub, view |
- Bedroom count matters. 4–6 bed homes outperform 2–3 bed dramatically per night and per year. Family-of-multiple-families demand is the highest-paying segment.
- Hot tubs are nearly required. Listings without a hot tub underperform listings with one by a wide margin.
- Garages matter for ski-season ADR. Heated garages and gear storage drive better reviews.
- Real wood, real stone, real fireplace — the “ski-house” aesthetic — outperforms generic-mountain-modern in nightly rate.
- View matters less than people think. Layout, sleeps-count, and amenity stack matter more than mountain view for ADR.
The remodel math: when an existing home pencils
If you’re buying an existing Teton Valley home to remodel and Airbnb, the math hinges on: (1) acquisition price vs. comparable un-remodeled comps, (2) remodel cost vs. ADR uplift it actually delivers, and (3) operating cost realism.
Scenario A: Dated 3-bed cabin, $725K, $200K remodel. Pre-remodel ADR ~$250 → post ~$400. Occupancy 50–55%. Gross ~$73K → ~$80K. Opex 35–45%. Net before debt service ~$45K–$52K. Cash-on-cash on the remodel: meaningful if you bought right.
Scenario B: 4-bed mid-finish, $1.4M, $350K remodel. Pre-remodel ADR ~$400 → post ~$625. Occupancy 55–62%. Gross ~$80K → ~$140K. Opex 35–45%. Net before debt service ~$80K–$90K.
Scenario C: 5–6 bed STR-optimized new build, $2.6M all-in. ADR $700–$900 weighted. Occupancy 55–62%. Gross $170K–$220K. Opex 35–45%. Net before debt service $100K–$140K. Harder to pencil without significant equity or partial use.
These are illustrative — the actual numbers depend on your specific property, your operations, and STR market conditions in the year you operate. Don’t lift these scenarios into a deal model without running your own underwriting.
Which remodels pay off — and which don’t
Pays back in ADR uplift:
- Kitchen — major impact on listing photos and guest reviews.
- Primary bath + at least one secondary bath — primary bath finish drives nightly rate.
- Hot tub installation — among the highest-ROI single upgrades.
- Heated garage or mudroom with ski/gear storage.
- Real stone fireplace surround.
- Bunk room conversions — turning a den into a bunk room adds 2–4 sleeps and meaningfully raises nightly rate.
- Outdoor living: deck, fire pit, view-orientation.
- Photography-first design choices.
Doesn’t pay back at the rate California buyers expect:
- High-end appliances (guests notice if the dishwasher is loud, not the brand)
- Wine fridges and bar built-ins in a property under 5 beds
- Luxury primary closet build-outs
- Heated driveways
- Smart home complexity — guests often can’t operate it; service calls eat margin
- Custom architectural features in places guests don’t photograph
The principle: spend where the listing photos and the guest reviews actually move. Anything that doesn’t show in a listing photo or trigger a 5-star review is owner-luxury, not STR investment.
The new build path: STR-optimized custom from the ground up
- Bedroom count to 4–6. Maximize sleeps without crossing into “feels like a hostel.”
- Bunk room + dedicated kids’ space that drives multi-family bookings.
- Two living zones — one for adults, one for kids.
- Heated garage with gear room, ski storage, boot dryers.
- Hot tub with view orientation and privacy.
- Mudroom directly off garage with bench seating, hooks, dog wash.
- Outdoor living: covered deck, fire pit, fenced yard if dog-friendly.
- Durable finishes — wide-plank floors that hide wear, hard countertops, paint that touches up easily.
- Photography orientation — main living spaces oriented to the photogenic views.
A well-designed 5-bed STR-optimized new build in the $2.4M–$3.2M total range can land in the upper-decile gross revenue band — $200K+ annually — if operations and location are right.
Operating costs — what investors leave out of their spreadsheets
| Line item | % of gross |
|---|---|
| Property management | 18%–28% |
| Cleaning | 10%–15% |
| Utilities (winter-heavy) | 4%–8% |
| Internet, streaming, smart-home | 1%–2% |
| Supplies, linens | 2%–4% |
| Repairs + snow removal | 4%–8% |
| STR-rated insurance | 1%–3% |
| Hot tub, HVAC, septic | 1%–2% |
| Total realistic opex | 35%–50% of gross |
If your spreadsheet has opex at 20% of gross, your spreadsheet is wrong. Fix it before you make an offer.
Self-manage vs. full-service property management
Self-managing from California is possible but punishing. The cleaners, the guest issues at midnight, the contractor coordination when something breaks, the snow-removal calls — they don’t respect Pacific time. Most California investors who self-manage burn out in 12–18 months and switch to local property management.
Full-service local property management runs 18%–28% of gross revenue, sometimes higher for boutique operators. The good ones earn their fee in higher occupancy, better reviews, and faster maintenance. Vet them like you’d vet a builder — references, response time, fee structure, transparency on their dynamic pricing.
Realistic ROI expectations
- Cash-on-cash return on remodel investment: typically 8%–18%, sometimes higher
- Cap rate on new-build STR (gross-to-acquisition): typically 5%–8%, occasionally higher
- Total return including appreciation: historically strong in Teton Valley, but past appreciation is not a guarantee of future
- Payback period on a remodel: typically 3–6 years on the remodel-specific spend
When Teton Valley STR doesn’t make sense for a California investor
- You need this to cashflow in year one or two. STRs ramp. Plan for year 2–3 to hit stride.
- You can’t tolerate seasonality. Mud season is real. April and May gross will disappoint you.
- You’re not willing to verify STR rules before closing.
- Your spreadsheet has opex below 30% of gross. It’s wrong; fix it.
- You can’t afford to hold through a soft year.
For California investors comfortable with those realities, who buy right, build or remodel smart, and run real ops — Teton Valley is one of the better STR markets in the Mountain West.
Where to start
- Lock the STR rule check. City, county, HOA. In writing. Before LOI.
- Get a real underwrite. AirDNA gives directional. Local STR comps and a builder’s renovation estimate give actual.
- Walk the property with a builder before close.
- Decide self-manage vs. property-managed up front.
- Vet the property manager as carefully as you vet the builder.
FAQ
What’s the realistic ROI on an Airbnb in Teton Valley?
Well-positioned, well-operated STRs in Teton Valley typically gross $80K–$220K annually, with operating costs of 35–50% of gross. Cash-on-cash returns on remodel investment commonly run 8–18%; new-build STRs typically run cap rates of 5–8% before appreciation.
Can I Airbnb a property in Driggs or Victor?
Sometimes — depends on the specific parcel, zone, city ordinance, and HOA. Driggs, Victor, and unincorporated Teton County each have separate STR rules, and many HOAs additionally restrict STRs in their CC&Rs. Always verify all three in writing before closing.
How much does it cost to remodel a Teton Valley home for Airbnb?
Typical remodels for STR optimization run $150K–$500K depending on scope. Kitchen + primary bath + hot tub + outdoor living + mudroom upgrades are the highest-ROI areas.
What ADR can I expect from a Teton Valley Airbnb?
Annual average ADR ranges from $300 to $550 for well-positioned, well-managed properties. Peak weeks command $700–$1,500+. Shoulder seasons drag heavy.
How much do property managers charge in Teton Valley?
Full-service local property management typically runs 18%–28% of gross revenue. Self-management is possible but operationally heavy when you’re in California.
What’s the biggest mistake California investors make on Teton Valley STRs?
Three tied for first: (1) not verifying STR rules at the parcel level before closing, (2) undercounting operating costs in their spreadsheet, and (3) overspending on owner-luxury features that don’t move ADR or reviews.
Should I build new or remodel for an Airbnb in Teton Valley?
Depends on price-to-build vs. price-to-buy in your target zone, and on whether existing properties let you deliver the bedroom count and amenity stack the market wants. Smaller 3-bed remodels often pencil better; large 5–6 bed STR programs often have to be new builds.
Author: Bryce Swager — owner-builder at SwagerBuilds. Building and remodeling STRs in Teton Valley for California-based investors since 2020.
Want a realistic underwrite on a specific property? Book a 30-min planning call →
Related reading
- Building a Second Home in Teton Valley as a California Homeowner
- Driggs vs Victor: Where Bay Area Families Are Building Right Now
- How California Homeowners Manage a Custom Home Build From 800 Miles Away
- 7 Things California Buyers Get Wrong About Building in Idaho
Outbound authority sources
- AirDNA — Teton Valley STR data
- City of Driggs — STR licensing & ordinance
- City of Victor — STR licensing & ordinance
- Teton County, Idaho — unincorporated-area STR rules
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