Is Barnesville, Minnesota Good for Airbnb Investment?

To start an Airbnb in Barnesville, Minnesota, begin by researching local zoning laws and regulations through the Barnesville City Hall (218-354-2292) as the city may require business licenses or have specific short-term rental ordinances, though many smaller Minnesota cities have minimal restrictions compared to larger metros like Minneapolis. Contact Clay County offices to verify any county-level requirements and ensure your property meets fire safety codes and building standards. Find a suitable property by searching local real estate listings through agents familiar with Barnesville's market, focusing on homes near attractions like the Buffalo River or downtown area, with properties typically ranging from $80,000-$200,000. Obtain necessary permits including a business license from the city clerk, ensure compliance with Minnesota Department of Health lodging regulations if applicable, and verify your homeowner's insurance covers short-term rentals or purchase additional coverage. Furnish the property with quality basics including comfortable beds, linens, kitchen essentials, WiFi, and local amenities information, budgeting approximately $5,000-$15,000 for a complete setup. Create your Airbnb listing with professional photos highlighting the rural Minnesota charm, proximity to outdoor activities, and small-town atmosphere, setting competitive rates around $75-$125 per night based on local market analysis. Manage the property by establishing cleaning protocols between guests, maintaining responsive communication, providing local recommendations for dining and activities in the Barnesville area, and ensuring compliance with Minnesota's 6.875% sales tax plus any local lodging taxes that may apply.

To identify profitable short-term rental properties in Barnesville, Minnesota, focus on properties within walking distance of downtown attractions, near Barnesville Potato Days festival venues, or close to outdoor recreation areas like the Buffalo River. Target 2-4 bedroom single-family homes or cabins with unique features such as fireplaces, outdoor spaces, or vintage charm that appeal to visitors attending local events or exploring rural Minnesota. Conduct pricing analysis by researching comparable Airbnb and VRBO listings within a 20-mile radius, including Moorhead and Fargo markets, aiming for properties under $150,000 that can command $80-120 per night during peak seasons like summer festivals and hunting seasons. Research competition by analyzing existing STR listings on platforms like AirDNA, noting occupancy rates and seasonal demand patterns, particularly during Potato Days in August and fall hunting season. Utilize tools such as Mashvisor for market analysis, BiggerPockets for investment calculations, and local resources like Clay County tourism data, Barnesville Chamber of Commerce insights, and Minnesota Department of Natural Resources visitor statistics to understand seasonal tourism patterns and ensure compliance with local zoning regulations before investing.

To obtain an Airbnb/STR permit in Barnesville, Minnesota, contact the Barnesville City Hall at 218-354-2292 or visit their office at 109 3rd Street NE to inquire about short-term rental licensing requirements, as the city likely requires a business license and potentially a conditional use permit for residential properties used for commercial purposes. Required documents typically include a completed application form, property deed or lease agreement, proof of insurance with minimum $1 million liability coverage, floor plan showing maximum occupancy, contact information for a local property manager if you're not local, and proof of compliance with fire safety codes including smoke and carbon monoxide detectors. The application fee is estimated at $100-200 for the initial permit with annual renewal fees of $50-100, and you may need to pay additional fees for inspections ($75-150) and conditional use permits if required ($200-400). The approval timeline is typically 4-6 weeks from submission of a complete application, including time for city council review if a conditional use permit is needed. Barnesville-specific requirements likely include adherence to residential zoning restrictions, maximum occupancy limits based on bedrooms and square footage, parking requirements (typically one space per bedroom), noise ordinance compliance with quiet hours from 10 PM to 7 AM, and regular safety inspections to ensure compliance with building and fire codes.

Short-term rentals (STRs) in Barnesville, Minnesota are generally legal but subject to local regulations and state oversight. As a small city in Clay County with approximately 2,500 residents, Barnesville likely follows Minnesota's statewide STR framework established around 2019-2020, which requires hosts to register with the state, collect lodging taxes, and comply with safety standards. The city may have implemented its own zoning restrictions limiting STRs in certain residential areas or requiring conditional use permits, particularly in neighborhoods near the downtown core or residential zones to preserve community character. Recent changes in Minnesota have included stricter registration requirements and enhanced tax collection mechanisms, with some municipalities adopting more restrictive policies following concerns about housing availability and neighborhood impacts. Property owners in Barnesville should verify compliance with both state registration requirements and any local zoning ordinances, as violations can result in fines and operational restrictions, and the regulatory landscape has been evolving as communities balance tourism revenue with residential housing preservation.

The best areas for Airbnb investment in Barnesville, Minnesota include the downtown historic district near Main Street, which attracts visitors interested in the town's railroad heritage and proximity to the Buffalo River for fishing and outdoor recreation. The residential neighborhoods along Highway 9 offer convenient access for business travelers visiting local agricultural operations and the nearby Fargo-Moorhead metropolitan area, approximately 30 minutes away. Properties near Barnesville's community events venues benefit from seasonal demand during the annual Potato Days festival and high school sports tournaments. The areas close to the Buffalo River State Park boundary provide strong appeal for nature enthusiasts, hunters, and anglers, particularly during peak outdoor seasons from May through October. Investment properties within walking distance of Casey's General Store and local dining establishments perform well due to convenience factors, while homes near the school district attract families visiting for educational events and activities throughout the academic year.

Airbnb properties in Barnesville, Minnesota are subject to Minnesota state lodging tax of 3% on gross receipts from short-term rentals under 30 days, which is collected by the host and remitted quarterly to the Minnesota Department of Revenue. Clay County imposes an additional lodging tax of approximately 3-4% that applies to short-term rental accommodations, with collection and remittance typically handled through the county's tax collection system. The City of Barnesville may impose a local lodging or transient occupancy tax of 1-2%, though smaller municipalities sometimes rely solely on county and state taxes. Hosts are generally required to register with the Minnesota Department of Revenue, obtain a sales tax permit, and file quarterly returns by the 20th of the month following each quarter. Properties rented for 30 days or longer are typically exempt from these lodging taxes, and certain nonprofit or charitable accommodations may qualify for exemptions. Airbnb may collect and remit some of these taxes automatically depending on local agreements, but hosts remain ultimately responsible for ensuring compliance with all applicable tax obligations and should verify current rates and procedures with state and local tax authorities.

To start an Airbnb in Barnesville, Minnesota, expect total costs around $185,000-$220,000. Property purchase will be the largest expense at approximately $150,000-$180,000 based on median home prices in rural Minnesota markets. Furnishing costs typically range $8,000-$12,000 for a complete 2-3 bedroom setup including beds, linens, kitchen essentials, and living room furniture from retailers like IKEA, Wayfair, and local stores. Initial setup costs including professional photography, listing creation, and basic renovations average $2,000-$3,500. Permits and fees vary but expect around $500-$1,200 for business licenses, short-term rental permits, and potential zoning approvals from Clay County and city authorities. Insurance premiums for short-term rental coverage typically cost $1,200-$2,000 annually, so budget $600-$1,000 for the first six months. Utility setup and deposits for electricity, gas, water, internet, and cable average $800-$1,200 initially. First six months operating costs including utilities ($300-$500 monthly), cleaning supplies, maintenance, platform fees to Airbnb and VRBO (3% each), and marketing total approximately $3,000-$5,000. Additional considerations include property taxes, which in Clay County average 1.1% annually, and potential HOA fees if applicable.

Airbnb properties in Barnesville, Minnesota show moderate profitability potential with average nightly rates ranging from $75-120 for typical 2-3 bedroom homes, generating approximately $18,000-28,000 in annual revenue assuming 60-70% occupancy rates during peak summer months and hunting seasons. Operating expenses typically consume 40-50% of gross revenue, including property management fees (15-25%), cleaning costs ($40-60 per turnover), utilities ($150-200 monthly), insurance ($1,200-1,800 annually), and maintenance reserves (8-12% of revenue), resulting in net profit margins of 25-35% for well-managed properties. Success factors in this rural market include proximity to outdoor recreation areas like Buffalo River State Park, competitive pricing during peak hunting seasons (October-November), and targeting family reunions or corporate retreats given limited hotel options in the area. Properties within 10 miles of Moorhead-Fargo metropolitan area command premium rates due to overflow demand, while those featuring amenities like hot tubs, fire pits, or boat access to nearby lakes achieve 15-20% higher occupancy rates and can sustain profit margins approaching 40%, though the seasonal nature of tourism in central Minnesota requires careful cash flow management during slower winter months.

Airbnb investments in Barnesville, Minnesota typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10%, primarily driven by seasonal tourism and outdoor recreation visitors to the nearby lakes region and Maplewood State Park. Properties in Barnesville generally achieve profitability within 18-24 months, with average daily rates of $85-120 depending on property size and amenities, occupancy rates averaging 45-60% annually with peak summer months reaching 75-85%. The market benefits from limited hotel inventory and proximity to Fargo-Moorhead metropolitan area, with investors typically seeing break-even on initial investment and operational costs by month 20-26, while properties closer to recreational areas or featuring unique amenities like lake access can achieve the higher end ROI figures of 11-12% annually.

STRSearch is a national platform that helps investors identify profitable short-term rental properties including in Barnesville, Minnesota. Local real estate agents like those at RE/MAX Lakes Region and Coldwell Banker King serve the Barnesville area and can assist with Airbnb investment properties. Mashvisor and AirDNA provide market analysis tools for short-term rental investments in smaller Minnesota markets. RedAwning offers property management services for Airbnb hosts in rural Minnesota locations. Local property management companies like Lake Country Property Management may service the Barnesville area for short-term rental operations. BiggerPockets connects investors with local real estate professionals familiar with vacation rental investments in Minnesota. Vacasa and Awning provide professional Airbnb management services that extend to smaller Minnesota markets. Local real estate agents at Keller Williams and Century 21 in nearby Fargo-Moorhead metro area often work with clients seeking investment properties in surrounding communities like Barnesville. Roofstock and Arrived Homes occasionally feature short-term rental investment opportunities in secondary Minnesota markets.