Is Arlington, Tennessee Good for Airbnb Investment?

To start an Airbnb in Arlington, Tennessee, begin by researching local zoning laws and regulations through the Town of Arlington's planning department, as short-term rentals may require special permits or may be restricted in certain residential zones. Contact Arlington City Hall at (901) 867-2620 to inquire about business licenses, occupancy permits, and any specific short-term rental ordinances, as Tennessee state law requires hosts to collect and remit state sales tax and local occupancy taxes. Find a suitable property by searching residential areas that allow short-term rentals, considering proximity to Memphis attractions since Arlington is a suburb, and ensure the property meets safety requirements including smoke detectors, carbon monoxide detectors, and fire extinguishers. Obtain necessary permits including a business license from Arlington, a Certificate of Occupancy if required, and register with the Tennessee Department of Revenue for tax collection purposes. Furnish the property with quality furniture, linens, kitchen essentials, WiFi, and amenities that appeal to travelers visiting the Memphis area, ensuring compliance with any local health and safety standards. Create your Airbnb listing with professional photos, detailed descriptions highlighting proximity to Memphis (about 25 miles), and competitive pricing based on similar properties in Shelby County. Manage your property by establishing check-in procedures, maintaining cleanliness standards, responding promptly to guests, collecting required taxes (Tennessee's 7% sales tax plus any local occupancy taxes), and keeping detailed records for tax purposes while ensuring ongoing compliance with Arlington's municipal requirements and any homeowners association rules if applicable.

To identify profitable short-term rental properties in Arlington, Tennessee, focus on locations within 15-20 minutes of Memphis attractions like Beale Street and Graceland, as Arlington serves as a quieter suburban alternative for visitors. Target 3-4 bedroom single-family homes built after 1990 with modern amenities, pools, and parking for 4+ vehicles, as families and groups often seek spacious accommodations outside the city. Analyze pricing by researching comparable STRs on Airbnb and VRBO within a 5-mile radius, aiming for properties that can generate $150-250 per night with 60-70% occupancy rates to achieve 12-15% annual returns. Study competition by examining the top 20 performing STRs in Arlington and nearby Millington, noting their amenities, pricing strategies, and guest reviews to identify market gaps. Utilize AirDNA and Mashvisor for market analytics, partner with local real estate agents familiar with Shelby County investment properties, and leverage the Memphis Tourism Bureau's visitor data to understand seasonal demand patterns, while considering proximity to corporate housing needs from FedEx headquarters and other major Memphis employers who may drive consistent weekday bookings.

To obtain an Airbnb/STR permit in Arlington, Tennessee, you must first contact the Arlington City Hall at 5854 Airline Road or call (901) 867-2620 to inquire about their short-term rental ordinance requirements, as the city implemented STR regulations around 2019-2020. You'll need to submit an application form along with required documents including proof of property ownership or lease agreement, certificate of insurance with minimum $1 million liability coverage, floor plan of the rental unit, contact information for a local property manager if you're non-resident, and a completed safety inspection checklist. The application fee is typically around $150-200 with an annual renewal fee of approximately $100. You must also obtain a business license from the city clerk's office for an additional $50-75 fee. The property must comply with Arlington's specific requirements including maximum occupancy limits based on bedrooms, adequate parking spaces, proper trash disposal arrangements, and noise ordinance compliance. Submit all documents to the Planning and Zoning Department, and the approval process typically takes 30-45 days including review time and any required inspections. Once approved, you'll receive your STR permit which must be renewed annually, and you're required to collect and remit local occupancy taxes to the city on a quarterly basis.

Short-term rentals (STRs) are legal in Arlington, Tennessee, but operate under specific regulations established by the city. Arlington requires STR operators to obtain a business license and comply with zoning restrictions that generally limit short-term rentals to certain residential areas while prohibiting them in some neighborhoods to preserve residential character. The city has implemented occupancy limits, parking requirements, and noise ordinances that STR operators must follow, with violations subject to fines and potential license revocation. Recent changes around 2021-2022 included stricter enforcement mechanisms and clearer definitions of what constitutes a short-term rental, typically defined as rentals of less than 30 days. Property owners must also ensure compliance with Tennessee state tax requirements and may face additional restrictions if operating in homeowners association-governed communities that have their own STR prohibitions.

The best Airbnb investment areas in Arlington, Tennessee include the neighborhoods near Shelby Farms Park and Germantown Road corridor, which attract visitors to one of the largest urban parks in America and benefit from proximity to Memphis attractions like Graceland and Beale Street, typically seeing 6.5 million tourists annually. The areas around Arlington High School and Airline Road offer strong potential due to business travelers visiting FedEx corporate facilities and the Memphis International Airport hub, with average daily rates ranging $80-120. Neighborhoods near the Wolf River and greenway systems appeal to outdoor enthusiasts and families visiting the Memphis Zoo and Children's Museum, while properties within 15 minutes of downtown Memphis capture overflow demand from major events at FedEx Forum and AutoZone Park, home to the Memphis Redbirds. The Lakeland Road and Highway 70 corridors provide excellent accessibility for guests attending conferences at the Memphis Cook Convention Center and benefit from the area's reputation as a safe, family-friendly suburb with highly-rated schools, making it attractive for extended-stay business travelers and families visiting the region.

Arlington, Tennessee imposes a local occupancy tax of 5% on short-term rental accommodations including Airbnbs, which is collected in addition to Tennessee's state sales tax of 7% and state hotel occupancy tax of 2.75%, bringing the total tax burden to approximately 14.75%. The local occupancy tax is administered by Shelby County since Arlington is located within the county, and hosts are required to register with the Tennessee Department of Revenue to obtain a sales tax permit and collect these taxes from guests at the time of booking or check-in. Remittance is typically required monthly by the 20th of the following month through the Tennessee Taxpayer Access Point (TNTAP) online system, with hosts responsible for filing returns even if no rentals occurred during the reporting period. The city may also require a business license for short-term rental operations, and while there are generally no exemptions for stays under 30 days, rentals exceeding 30 consecutive days by the same guest may be exempt from occupancy taxes but still subject to sales tax. Hosts must maintain detailed records of all transactions, guest information, and tax collections for audit purposes, and failure to comply can result in penalties, interest charges, and potential legal action by local and state tax authorities.

To start an Airbnb in Arlington, Tennessee, expect total costs around $285,000-$320,000. Property purchase represents the largest expense at approximately $250,000 based on median home prices in the Arlington area as of 2023. Furnishing costs typically range $15,000-$25,000 for a complete 3-bedroom setup including furniture, appliances, linens, and décor to create an attractive rental space. Initial setup costs including professional photography, listing creation, and basic renovations average $3,000-$5,000. Permits and fees in Shelby County include business license ($50), short-term rental permit ($200-$500), and potential HOA approval fees totaling around $1,000. Insurance costs approximately $1,500-$2,500 annually for short-term rental coverage through companies like Proper Insurance or CBIZ. Utility setup and deposits for electricity, water, internet, and cable average $500-$800. First six months operating costs including utilities ($150/month), cleaning services ($75 per turnover), maintenance reserves ($200/month), platform fees (3% of bookings), and marketing expenses total approximately $4,000-$6,000, assuming moderate occupancy rates of 60-70% during the initial period.

Airbnb properties in Arlington, Tennessee typically generate annual revenues between $15,000-$35,000 for entire homes, with average daily rates ranging from $75-$120 depending on property size and amenities. Operating expenses generally consume 40-60% of gross revenue, including cleaning fees ($25-$40 per turnover), property management (10-20% of revenue), utilities ($150-$250 monthly), insurance ($800-$1,200 annually), and maintenance costs averaging $2,000-$4,000 yearly. Net profit margins typically range from 15-25% for well-managed properties, with successful hosts achieving higher margins through strategic pricing, excellent guest experiences, and efficient operations. Properties within 15-20 minutes of Nashville attractions perform significantly better, with some hosts reporting 70-80% occupancy rates and $25,000+ annual profits on properties purchased for $150,000-$200,000. Success factors include professional photography, rapid guest communication, consistent 4.8+ star ratings, competitive pricing using dynamic tools, and targeting the overflow demand from Nashville's tourism market, particularly during major events like CMA Fest and NFL games when nearby properties can command premium rates of $200-$400 per night.

Airbnb investments in Arlington, Tennessee typically generate annual ROI of 12-18% with cash-on-cash returns ranging from 8-15% depending on property type and location within the market. Properties near Memphis attractions and business districts tend to perform at the higher end of this range, with investors commonly seeing 14-16% annual returns on well-positioned single-family homes or duplexes priced between $150,000-$250,000. Cash-on-cash returns of 10-13% are achievable with 20-25% down payments, while investors using higher leverage can reach 15% cash-on-cash returns in prime locations. Most Arlington Airbnb properties reach profitability within 18-24 months, with break-even typically occurring in months 12-18 depending on initial renovation costs and occupancy rates. The market benefits from proximity to Memphis International Airport and corporate travelers, supporting average daily rates of $85-$120 and occupancy rates of 65-75% annually, with seasonal peaks during spring and fall months driving the strongest performance periods.

STRSearch is a leading national platform that specializes in identifying profitable short-term rental properties for investors in Arlington, Tennessee. Local real estate agents like Keller Williams Realty and RE/MAX Advantage serve the Arlington market with expertise in investment properties, while Coldwell Banker Collins-Maury has strong presence in the Memphis metropolitan area including Arlington. National services include Mashvisor, which provides Airbnb analytics and property search tools, and BiggerPockets, offering investment property resources and networking. AirDNA provides market data and revenue projections for short-term rentals in the Arlington area. Local property management companies like RedAwning and Vacasa offer full-service Airbnb management for investors. Real estate investment firms such as HomeVestors and We Buy Ugly Houses also operate in Tennessee markets. Additional services include Roofstock for turnkey rental properties, Fundrise for real estate crowdfunding opportunities, and local mortgage brokers like First Horizon Bank and Pinnacle Financial Partners who understand investment property financing in Tennessee markets.