Is Bismarck, North Dakota Good for Airbnb Investment?

To start an Airbnb in Bismarck, North Dakota, begin by researching local regulations as the city requires short-term rental operators to obtain a business license and comply with zoning ordinances that typically allow rentals in residential areas with certain restrictions. Contact Bismarck's Planning and Zoning Department at City Hall (221 N 5th Street) to verify your property's zoning compliance and obtain necessary permits, which may include a conditional use permit depending on your location. Find a suitable property in neighborhoods like Cathedral District or downtown areas that attract visitors, ensuring it meets safety requirements including smoke detectors, carbon monoxide detectors, and adequate egress routes. Furnish the space with quality furniture, linens, and amenities while focusing on comfort and local touches that reflect North Dakota's character. Create your Airbnb listing with professional photos, competitive pricing (typically $75-150/night in Bismarck as of 2023), and detailed descriptions highlighting proximity to attractions like the North Dakota Heritage Center or Missouri River. For ongoing management, establish cleaning protocols between guests, respond promptly to inquiries, maintain the property regularly, collect and remit the required 7% state sales tax and 2% city lodging tax to North Dakota's Tax Department, and consider using property management software or hiring local cleaning services to streamline operations while ensuring compliance with all city ordinances and state tax obligations.

To identify profitable short-term rental properties in Bismarck, North Dakota, focus on locations within 2-3 miles of downtown, near the State Capitol complex, Bismarck State College, or major employers like Sanford Health and Basin Electric Power Cooperative. Target 2-4 bedroom single-family homes or condos built after 1990 with modern amenities, full kitchens, parking, and outdoor spaces that can accommodate business travelers and families visiting for government business or medical appointments. Analyze pricing by researching comparable Airbnb listings in the $80-150 nightly range, considering Bismarck's seasonal demand peaks during summer months and legislative sessions (January-April in odd years). Conduct competition research using AirDNA and Mashvisor to assess occupancy rates and revenue potential, noting that Bismarck has limited STR inventory compared to larger markets, creating opportunity for well-positioned properties. Utilize local resources like the Bismarck-Mandan Development Association for market insights, partner with local property management companies familiar with North Dakota's STR regulations, and leverage tools like Rabbu and PriceLabs for dynamic pricing while monitoring hotel rates at properties like Radisson and Hampton Inn to ensure competitive positioning in this government and energy-sector driven market.

To obtain an Airbnb/STR permit in Bismarck, North Dakota, you must first contact the Bismarck Planning and Zoning Department at City Hall located at 221 North 5th Street to determine if short-term rentals are permitted in your specific zoning district, as the city implemented regulations around 2019-2020. You'll need to submit an application that includes a completed short-term rental permit form, proof of property ownership or lease agreement, a site plan showing parking areas and property layout, proof of liability insurance (typically $1 million minimum), a fire safety inspection certificate from the Bismarck Fire Department, and contact information for a local responsible party if you're an absentee owner. Required documents also include a business license from the North Dakota Secretary of State if operating as a business entity, and compliance with all building and health codes. The application fee is approximately $100-200 with annual renewal fees of around $50-100, though you should verify current rates with the city. The approval timeline typically takes 30-60 days depending on inspection scheduling and application completeness. Bismarck-specific requirements include maintaining adequate off-street parking (usually 2 spaces minimum), ensuring the property meets residential occupancy limits (typically 2 people per bedroom plus 2 additional), displaying the permit number in all advertising, and maintaining a guest registry. You must also comply with noise ordinances, waste management requirements, and may need to register for local lodging taxes with the Bismarck Finance Department.

Short-term rentals (STRs) are legal in Bismarck, North Dakota, but operate under specific regulations established by the city. As of 2023, Bismarck requires STR operators to obtain a business license and comply with zoning restrictions that primarily allow STRs in residential areas with certain limitations on the number of guests and parking requirements. The city prohibits STRs in some residential zones and requires operators to maintain liability insurance, provide emergency contact information, and ensure properties meet safety standards including smoke and carbon monoxide detectors. Recent changes around 2022-2023 have included stricter enforcement of noise ordinances and neighbor notification requirements, with the city implementing a complaint-based system for violations. Properties must also comply with occupancy limits based on bedroom count and available parking, and operators face potential fines for violations including noise complaints, overcrowding, or operating without proper licensing, though the overall regulatory framework remains relatively permissive compared to other North Dakota municipalities.

The best Airbnb investment areas in Bismarck, North Dakota include the downtown Historic District near Main Avenue and 4th Street, which attracts business travelers visiting the state capitol, government offices, and corporate headquarters like MDU Resources Group. The Kirkwood Mall area and Century Avenue corridor offer excellent potential due to proximity to major retailers, restaurants, and the Bismarck Event Center which hosts concerts, sports events, and trade shows throughout the year. The Missouri River waterfront neighborhoods, particularly around Keelboat Park and the Lewis and Clark Riverboat, appeal to tourists exploring the Lewis and Clark Trail and outdoor enthusiasts enjoying river activities. Areas near Bismarck State College campus provide opportunities for visiting families, prospective students, and academic conference attendees. The Gateway Fashion Mall vicinity and Interstate 94 corridor neighborhoods serve travelers and business visitors to major employers like Sanford Health, while properties near the Bismarck Municipal Airport capture demand from fly-in business travelers and oil industry professionals working in the Bakken region who use Bismarck as a regional hub.

In Bismarck, North Dakota, Airbnb hosts are subject to both state and local lodging taxes. The North Dakota state lodging tax is 4% on gross receipts from short-term rentals under 30 days, while Bismarck imposes an additional local lodging tax of 3%, bringing the total occupancy tax rate to 7%. These taxes are typically collected directly by Airbnb from guests at the time of booking and remitted to the appropriate tax authorities on behalf of hosts, though hosts should verify their registration status with the North Dakota Tax Commissioner's office and obtain a sales tax permit. The state requires monthly remittance by the 15th of the following month, while local taxes are generally remitted quarterly. Exemptions may apply for stays exceeding 30 consecutive days, government employees on official business, and certain nonprofit organizations, though documentation is required. Hosts who collect taxes independently must register with both state and local authorities, maintain detailed records of all transactions, and file returns even during periods of no activity.

Starting an Airbnb in Bismarck, North Dakota requires approximately $180,000-220,000 in total initial investment. Property purchase costs around $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 furniture, appliances, linens, and décor from retailers like IKEA, Wayfair, and local stores. Initial setup costs including professional photography, listing creation, and basic marketing materials total approximately $1,500-2,500. Permits and fees vary but generally include business license ($50-100), short-term rental permit if required ($200-500), and potential HOA approval fees. Insurance costs run $1,200-2,000 annually for short-term rental coverage through companies like Proper Insurance or CBIZ. Utility setup and deposits for electricity, gas, water, internet, and cable total around $500-800 initially. First six months of operating costs including utilities ($200-300/month), cleaning supplies and services ($150-250/month), maintenance reserves ($100-200/month), platform fees to Airbnb and VRBO (3% of bookings), and property management software subscriptions total approximately $3,000-5,000, assuming moderate occupancy rates during the initial period.

Airbnb properties in Bismarck, North Dakota 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 location. Operating expenses generally consume 40-60% of gross revenue, including cleaning fees ($25-$40 per turnover), utilities ($150-$250 monthly), property management (10-20% of revenue), insurance ($800-$1,200 annually), and maintenance costs. Net profit margins typically range from 15-25% for well-managed properties, with higher margins achieved near downtown areas or properties catering to oil industry workers who often book extended stays. Success factors include proximity to the State Capitol, University of Mary, or Sanford Health facilities, as these drive consistent demand. Properties offering amenities like parking, Wi-Fi, and kitchen facilities perform better, with occupancy rates averaging 45-65% annually. The market benefits from limited hotel inventory and steady business travel, though seasonal fluctuations occur with lower winter bookings. A typical 3-bedroom home generating $28,000 annually might net $5,000-$7,000 after expenses, representing a 6-9% return on a $100,000 property value, making it moderately profitable compared to traditional rental investments in the region.

Airbnb investments in Bismarck, North Dakota typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10%, primarily driven by the city's stable oil industry workforce and limited hotel inventory creating consistent demand for short-term rentals. Properties near downtown Bismarck or close to major employers like Sanford Health and the State Capitol tend to achieve occupancy rates of 65-75% annually, with average daily rates between $85-120 depending on property size and amenities. Initial profitability usually occurs within 18-24 months for well-positioned properties, though the seasonal nature of North Dakota's economy means stronger performance during spring through fall months when construction and energy sector activity peaks. The relatively affordable real estate market in Bismarck, with median home prices around $280,000-320,000 as of recent years, allows for lower entry costs compared to major metropolitan markets, though investors should factor in higher utility costs during harsh winter months and potential vacancy periods during economic downturns in the energy sector.

STRSearch is a national platform that helps investors identify profitable short-term rental properties in Bismarck, North Dakota, using data analytics to evaluate potential returns. Local real estate agents like those at Coldwell Banker The Real Estate Group and RE/MAX Professionals have experience with investment properties in the Bismarck market and understand local zoning regulations for short-term rentals. Century 21 Morrison Realty and Keller Williams Realty also serve the area with agents knowledgeable about rental property investments. National services include Mashvisor, which provides rental property analysis and market data for Bismarck properties, and BiggerPockets, offering educational resources and networking for real estate investors. AirDNA provides short-term rental market analytics specifically for the Bismarck area, while Awning offers full-service Airbnb property management once properties are acquired. Local property management companies like Dakota Property Management can assist with ongoing operations, and national platforms like Vacasa and RedAwning provide comprehensive Airbnb management services for investors who purchase properties in the Bismarck market.