Is Bardstown, Kentucky Good for Airbnb Investment?

To start an Airbnb in Bardstown, Kentucky, begin by researching local regulations through the Bardstown City Hall (502-348-5947) and Nelson County offices, as Kentucky generally allows short-term rentals but municipalities may have specific zoning requirements and occupancy limits. Obtain necessary permits including a business license from Bardstown City Clerk ($25-50 annually), ensure your property meets fire safety codes, and verify homeowner's insurance covers short-term rentals or purchase additional coverage through companies like Proper Insurance ($200-400 annually). Find a suitable property in historic downtown Bardstown near bourbon distilleries like Heaven Hill or Barton 1792, or in residential areas within walking distance of My Old Kentucky Home State Park, with 2-3 bedroom properties typically renting for $80-150 per night. Furnish the space with bourbon-themed decor reflecting Bardstown's "Bourbon Capital of the World" status, include essential amenities like WiFi, cable TV, full kitchen, and provide local guidebooks featuring Kentucky Bourbon Trail attractions. List your property on Airbnb with professional photos highlighting proximity to distilleries, historic sites, and outdoor activities, setting competitive rates based on seasonal demand during Kentucky Derby (May) and bourbon festival periods. Manage the property by establishing relationships with local cleaning services ($40-60 per turnover), maintenance contractors, and consider using property management companies like Vacasa or RedAwning if you're not local, while maintaining 24/7 guest communication and stocking bourbon-themed welcome baskets to enhance the authentic Bardstown experience.

To identify profitable short-term rental properties in Bardstown, Kentucky, focus on locations within walking distance of the Kentucky Bourbon Trail distilleries like Bardstown Bourbon Company and Willett Distillery, as well as properties near downtown's historic district and My Old Kentucky Home State Park. Target 2-4 bedroom homes or condos built after 1990 with modern amenities, full kitchens, parking, and outdoor spaces that can accommodate bourbon tourism groups and families visiting local attractions. Analyze pricing by researching comparable Airbnb and VRBO listings in the $100-200 per night range, considering seasonal fluctuations during bourbon festival periods and summer tourist seasons. Conduct competition research by monitoring occupancy rates and guest reviews for existing STRs within a 3-mile radius of downtown Bardstown and major distilleries, identifying gaps in amenities or service quality. Utilize tools like AirDNA for market analytics, STR Helper for revenue projections, Mashvisor for investment analysis, and local resources including the Bardstown Tourism Commission for event calendars and visitor data, while consulting with local real estate agents familiar with Nelson County's zoning regulations and STR permit requirements.

To obtain an Airbnb/STR permit in Bardstown, Kentucky, contact the Bardstown City Hall at 204 North Third Street or call (502) 348-5947 to inquire about short-term rental regulations and application procedures. You will likely need to submit a completed business license application, property deed or lease agreement, certificate of occupancy, proof of liability insurance (typically $1 million minimum), fire safety inspection certificate, and Kentucky sales tax permit. Required documents may also include a site plan, parking plan, and contact information for a local property manager if you're not local. Application fees typically range from $50-150 for the initial permit plus annual renewal fees of $25-75. The approval process generally takes 2-4 weeks after submitting a complete application, though initial inspections may extend this timeline. Bardstown likely requires compliance with zoning restrictions (often limited to certain residential districts), occupancy limits based on bedrooms and square footage, adequate parking spaces (usually 1-2 per unit), and maintaining a complaint log. You must also register for Kentucky state sales tax collection, maintain current contact information with the city, and ensure the property meets all building and fire codes before hosting guests.

Short-term rentals (STRs) are legal in Bardstown, Kentucky, but operate under local regulations established by the city. Bardstown requires STR operators to obtain a business license and comply with zoning restrictions that typically limit rentals to certain residential areas while prohibiting them in some historic districts or specific neighborhoods. 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 2022-2023 have included stricter enforcement of existing regulations and enhanced complaint procedures for neighbors, though the city has generally maintained a permissive stance toward STRs given their importance to Bardstown's bourbon tourism industry. Property owners must also comply with state tax requirements and may face additional restrictions if their properties are located within historic overlay districts, where architectural and operational standards are more stringent.

The most promising Airbnb investment areas in Bardstown, Kentucky center around the Historic Downtown District, particularly properties within walking distance of the Kentucky Bourbon Trail attractions like Heaven Hill Distillery and Barton 1792 Distillery, as this area draws year-round bourbon tourism and benefits from the annual Kentucky Bourbon Festival which attracts over 50,000 visitors each September. The Court Square and Main Street corridor offers excellent potential due to proximity to My Old Kentucky Home State Park, the Stephen Foster Story outdoor drama (running June through August), and numerous bourbon distillery tours, making it attractive for both leisure tourists and bourbon enthusiasts. The Bloomfield Road area near Bardstown Country Club provides opportunities for business travelers and golf tourism, while properties near the Civil War Museum and Women's Civil War Museum on East Broadway capture history buffs and educational tour groups. The Nelson County area surrounding Bardstown also benefits from its position as a gateway to multiple bourbon distilleries including Jim Beam, Maker's Mark, and Four Roses, creating consistent demand from bourbon trail tourists who prefer staying in authentic small-town settings rather than Louisville hotels 40 miles away.

Airbnb properties in Bardstown, Kentucky are subject to Kentucky's state transient room tax of 1% on gross rental receipts, which applies to all short-term rental accommodations under 30 days. Additionally, properties may be subject to Nelson County's local occupancy tax, which is typically around 3% of gross rental receipts. The City of Bardstown may also impose its own local lodging tax of approximately 2-3% on short-term rentals. These taxes are generally collected from guests at the time of booking through Airbnb's platform, which automatically calculates and remits state taxes to the Kentucky Department of Revenue on behalf of hosts for properties booked through their system as of 2021. However, hosts remain responsible for registering with local tax authorities and remitting county and city occupancy taxes directly, typically on a monthly or quarterly basis depending on local requirements. Exemptions may apply for stays exceeding 30 consecutive days, certain government or non-profit travelers, and in some cases for properties renting fewer than a specified number of days per year, though hosts should verify current exemption criteria with the Kentucky Department of Revenue, Nelson County, and Bardstown city offices as tax rates and collection procedures can change.

Starting an Airbnb in Bardstown, Kentucky requires approximately $180,000-220,000 in total initial investment. Property purchase costs average $150,000-180,000 based on median home prices in the area as of 2023. Furnishing a 2-3 bedroom property typically runs $8,000-12,000 including beds, linens, kitchen essentials, living room furniture, and décor to create an attractive rental space. Initial setup costs including professional photography, listing creation, and basic renovations total around $2,000-3,000. Permits and fees in Nelson County include business license ($50-100), short-term rental permit ($200-400), and potential zoning compliance costs ($300-500). Insurance for short-term rentals runs $1,200-2,000 annually, with many hosts requiring specialized STR coverage from companies like Proper Insurance or CBIZ. Utility setup and deposits for electricity, water, gas, internet, and cable average $500-800 initially. First six months of operating costs including utilities ($200/month), cleaning supplies ($100/month), maintenance reserves ($150/month), platform fees to Airbnb and VRBO (3% of bookings), and marketing expenses total approximately $4,000-6,000, assuming moderate occupancy rates of 50-60% during the initial period.

Airbnb properties in Bardstown, Kentucky show moderate profitability potential with average daily rates ranging from $85-$150 depending on property size and proximity to bourbon distilleries like Heaven Hill and Barton 1792. A typical 2-bedroom property generates approximately $2,500-$4,200 monthly revenue during peak bourbon tourism season (April-October), while expenses including mortgage, utilities, cleaning, and maintenance average $1,800-$2,800 monthly, resulting in profit margins of 15-35%. Properties within walking distance of the Kentucky Bourbon Trail attractions command premium rates, with some hosts reporting annual revenues of $35,000-$55,000 on properties with acquisition costs around $150,000-$220,000. Success factors include bourbon-themed amenities, professional photography highlighting historic charm, strategic pricing during My Old Kentucky Home State Park events, and partnerships with local distillery tour companies. However, seasonal fluctuations significantly impact profitability, with winter months (November-March) seeing 40-60% revenue drops, making year-round cash flow management critical for sustained profitability in this bourbon tourism-dependent market.

Airbnb investments in Bardstown, Kentucky typically generate annual ROI of 12-18% with cash-on-cash returns ranging from 8-14%, driven by the city's proximity to bourbon distilleries like Heaven Hill and Barton 1792, which attract steady tourism year-round. Properties within walking distance of the Kentucky Bourbon Trail experiences command premium nightly rates of $120-180, while standard residential properties average $80-120 per night with 65-75% occupancy rates. Initial investment recovery typically occurs within 6-8 years for properties purchased at median prices of $180,000-250,000, with monthly gross revenues averaging $2,800-4,200 for well-positioned 2-3 bedroom properties. The market benefits from consistent demand during bourbon festival seasons and weekend tourism, with investors seeing break-even on operating expenses within 18-24 months and positive cash flow beginning in year two, particularly for properties renovated to appeal to bourbon tourism demographics.

STRSearch leads the national market for Airbnb investment property analysis and market research, providing comprehensive data on short-term rental performance in Bardstown, Kentucky. Local real estate agents specializing in investment properties include Coldwell Banker McMahan Co. and RE/MAX Properties East, both established in the Louisville metro area since the 1980s. Keller Williams Realty has agents trained in Airbnb investment strategies serving the Bardstown market since 2005. National services include Awning (founded 2017) which offers full-service Airbnb property management and acquisition assistance, Mashvisor (2014) providing real estate analytics for short-term rentals, and AirDNA (2015) offering market data and investment insights. RedAwning and Vacasa provide property management services that help investors identify profitable markets. Local property management companies like Kentucky Lake Vacation Rentals and Bluegrass Short Term Rentals, operating since approximately 2016-2018, offer acquisition consulting alongside their management services. BiggerPockets marketplace and Roofstock have expanded into short-term rental investments, while local investment groups through the Louisville Real Estate Investors Association provide networking and deal flow for the Bardstown area bourbon tourism market.