Is now a good time to buy a luxury vacation-rental property in Old Town and Main Street?
Short answer: Yes — if you plan to hold for 5+ years, Old Town and Main Street’s luxury market still offers strong rental income potential and long-term equity growth, despite today’s higher rates.
The luxury market has shifted — but opportunity remains
Old Town and Main Street have always been hotspots for buyers who want both lifestyle and income potential. Over the past 12 months, luxury inventory has risen slightly, giving buyers more choices than in the post-pandemic surge. According to Realtor.com, median list prices for luxury homes in the area have stabilized, hovering near $4.5M in late 2025, with days-on-market increasing by roughly 15% year over year.
This cooling period is creating a strategic window for well-capitalized buyers — particularly those eyeing properties with nightly rental eligibility. Listings that allow short-term rentals in Old Town are still limited, which keeps competition high among investors.
Why nightly rental potential matters
Luxury buyers aren’t just looking for dream homes anymore — they’re seeking dual-purpose properties: vacation retreats that earn revenue when not in use. In Old Town and Main Street, these homes often average $1,200–$2,500 per night, depending on amenities and proximity to Main Street or ski access (source: AirDNA).
Short-term rental demand remains resilient, with occupancy rates holding above 65% across much of the Wasatch Back region. Travelers continue to prioritize unique, high-end stays over hotels, giving luxury homeowners steady income potential year-round.
Mortgage rates and timing the buy
According to Freddie Mac, 30-year fixed mortgage rates are averaging around 6.8% as of late November 2025 — down slightly from summer highs. While rates aren’t expected to fall drastically, most forecasts anticipate gradual easing through mid-2026.
For buyers purchasing in cash or leveraging strong equity positions, this environment can work to your advantage: competition is lower, and sellers are more negotiable. Zillow data shows a 2% price reduction trend across Park City-area luxury listings since Q3, offering selective buyers room to negotiate on premium properties.
Local insight: what’s moving now
Based on MLS data from November 2025:
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Average list price: $4.5M
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Average sold price: $4.2M
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Active listings: ~42 in Old Town / Main Street
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Average days on market: 71 days
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Price per sq. ft.: ~$1,750
Homes offering nightly rental approval continue to sell about 18% faster than those restricted by HOAs or zoning. These properties draw interest from both domestic and international investors.
What to look for when buying
When evaluating luxury homes with short-term rental potential:
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Confirm zoning and rental permits (Old Town has specific short-term rental overlays).
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Check for HOA restrictions before making offers.
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Prioritize walkability and amenities — proximity to Main Street restaurants and slopes drives premium nightly rates.
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Use property managers who specialize in luxury vacation rentals to maximize revenue and compliance.
Outlook: 2026 and beyond
Redfin and Realtor.com forecasts suggest that Park City’s luxury market will stay stable through 2026, buoyed by limited supply, tourism resilience, and high-income migration. Even if appreciation slows, rental yields will likely offset carrying costs for owners who actively operate their properties.
In short: if you plan to buy, use, and rent strategically over several years, this is a good entry point. Waiting for the "perfect" rate may mean missing today’s negotiation power and available inventory.
FAQ
Q: Are nightly rentals still legal in Old Town and Main Street?
Yes — within designated zoning overlays. Always verify each property’s nightly rental eligibility through Park City’s planning department or your agent before closing.
Q: How much can I expect to earn from a luxury vacation rental?
Depending on location and size, luxury homes often gross $150K–$300K annually in rental income when professionally managed.
Q: What are the risks of buying now?
Primary risks include holding costs, possible rate stagnation, and local regulatory changes — though these are mitigated by owning a property with strong intrinsic and rental value.
Bottom line: If you want a luxury home in Old Town or Main Street that also pays you back, this is a moment worth seizing. Inventory is up, sellers are more flexible, and demand for high-end short-term stays remains strong.
Written by Wayne Levinson, Luxury Real Estate Specialist, Old Town & Main Street Real Estate Expert
