Las Vegas has one of the largest short-term vacation rental markets in the United States, and the revenues of hosts have been growing steadily for years there. The city has all the infrastructure required to start a successful business, even including companies like MasterHost that are ready to provide professional Airbnb management services. However, before launching an enterprise in Las Vegas, it is important to discover the main aspects of its rental market.
Benefits of Choosing Las Vegas for an Airbnb Business
The main benefit of Las Vegas in terms of launching short-term vacation rentals there relates to its performance metrics. They will be discussed in detail in the next section, but for now, it is enough to say it is one of the best cities in the United States in terms of Revenues generated by Airbnbs. The real estate prices are correspondingly high, but it is possible to break even comparably quickly thanks to the high rates and great occupancy results of rentals in the city.
Even though the competition in Las Vegas is fairly intense, it is still possible to gain a competitive advantage over other rentals in the city on day one. More than 60% of properties in Las Vegas operate with the Strict cancellation policy, so choosing a milder option will make the fresh rental a favorable choice for guests.
Another significant benefit of choosing Las Vegas for an Airbnb enterprise relates to its reduced seasonal effect. The Desert Oasis is popular all year round, and the fluctuations in demand are minimal throughout the year. Last year, the difference between the highest and the lowest values of Occupancy Rates was only 17%, indicating an incredibly strong stability of business here.
Last but not least, there are professional Airbnb management services available in the city, which is a great option for aspiring entrepreneurs to give a head start to their new business. Opting in for services of companies like
https://masterhost.ca/airbnb-management-las-vegas/ will ensure the first guests will have a great experience with the newly launched Airbnb and leave positive reviews, which is vital for the growth of the business in this niche.
Key Airbnb Performance Metrics in Las Vegas
As mentioned, the vacation rental market in Las Vegas is well-developed. At the time of writing, there are around 15,250 active listings there, and the average performance of these properties signals there is room for more rentals in this market. The Average Daily Rate is $305.2 in the city, and the Occupancy Rates average 59% throughout the year.
The majority of listings in Las Vegas are entire homes, as only 24% of all Airbnbs in the city are private or shared rooms. The apartments tend to be fairly small compared to other cities in the US, as the Revenue Per Available Room (RevPAR) is $184 here.
All these factors combined enable local properties to generate an average $65,800 worth of annual Revenue. The metric has been growing steadily over the past several years, meaning there is still an option for aspiring entrepreneurs to enter the market.
However, those who intend to launch an Airbnb in Las Vegas should keep in mind that the Revenues have been growing at a rate of 9% per year, while the number of listings has increased by 17% compared to last year. This signals the market will likely become oversaturated in a couple of years, so entrepreneurs should act fast to jump in before it happens.
Regulations of the Short-Term Rental Industry in Las Vegas
Airbnb is regulated heavily in the US, so the entrepreneurs planning to launch vacation rentals in Las Vegas should be prepared to comply with a number of laws and regulations. It is vital to plan this in advance, as there are multiple rules that should be taken into consideration as early as on the stage of purchasing real estate.
As in most other cities of the US, there are some zoning rules applied to vacation rentals in Las Vegas. The entrepreneurs won’t be able to launch an Aibnb in certain parts of the city, including the Symphony Park, the Skye Canyon, the Medical District, the Providence Square, and several other areas. Moreover, Airbnbs are forbidden in apartment buildings, and all short-term vacation rentals have to be at least 660ft away from each other.
The properties also have to comply with all the additional requirements of the city including noise, parking, trash, and other regulations specified in the Municipal Code of Las Vegas. There is also a maximum occupancy requirement of two people per bedroom that has to be met in order for the rental to operate legally.
Of course, owners of the business also have to pay taxes from the revenue their property generates. In terms of taxation, Airbnbs are viewed the same way as hotels, and the main tax that has to be paid ranges from 10% to 14% based on the area the property is located. Owners and operators of rentals also have to obtain special licenses for their Airnbs, and the process is fairly complex. It will be discussed in detail in the following section.
How to Get an Airbnb License in Las Vegas
Obtaining a license to operate an Airbnb in Las Vegas is a difficult procedure, but it is rather straightforward. The entrepreneur has to file an online application in order to initiate the process, but there are multiple steps they have to perform before that. First of all, it is vital to ensure the property complies with all the city’s requirements, as failing to meet them will result in significant delays.
After ensuring the property complies with the rules, it is necessary to obtain insurance for it. The coverage has to be worth at least $500,000, as it is a legal requirement for getting a license. Once these two steps have been performed, it is possible to submit the online application.
Describing the entire process in detail deserves a separate article, so for now, it will be enough to mention its key aspects. The entrepreneurs have to keep in mind that the procedure involves paying a license fee and having an inspector visit the property to ensure it matches with all the criteria.