Is Cabot, Arkansas Good for Airbnb Investment?

To start an Airbnb in Cabot, Arkansas, begin by researching local zoning laws and regulations through the Cabot Planning Department, as the city may require short-term rental permits or business licenses, and check with Lonoke County for any additional requirements since Cabot operates under county jurisdiction for some regulations. Contact the Arkansas Department of Finance and Administration to obtain a state sales tax permit, as you'll need to collect and remit state and local taxes on rental income. Find a suitable property by searching residential areas that allow short-term rentals, focusing on neighborhoods near Cabot's downtown area or properties with easy access to Little Rock (about 25 miles away), and ensure the property meets safety requirements including smoke detectors, carbon monoxide detectors, and proper egress windows. Furnish the space with quality furniture, linens, kitchen essentials, and amenities like WiFi, cable TV, and basic toiletries, while ensuring compliance with Arkansas fire safety codes. Create your Airbnb listing with professional photos, competitive pricing (typically $75-150 per night in the Cabot area based on property size and amenities), and detailed descriptions highlighting proximity to attractions like the Arkansas River Trail or downtown Little Rock. Manage your property by establishing check-in procedures, maintaining cleanliness standards, responding promptly to guest inquiries, and keeping detailed records for tax purposes, while also considering property management software or local cleaning services to streamline operations.

To identify profitable short-term rental properties in Cabot, Arkansas, focus on locations within 15-20 minutes of Little Rock's downtown area, near Cabot High School sports facilities, and close to outdoor recreation areas like Brewer Lake or the Arkansas River, as these attract business travelers, sports families, and weekend tourists. Target 3-4 bedroom single-family homes built after 1990 with modern amenities, full kitchens, outdoor spaces, and reliable internet, as these appeal to families and groups visiting the area. Conduct pricing analysis using AirDNA and Mashvisor to benchmark nightly rates between $80-150 depending on size and amenities, while analyzing seasonal demand patterns around school events and Little Rock business travel. Research competition by monitoring existing Airbnb and VRBO listings within a 5-mile radius, noting occupancy rates, guest reviews, and pricing strategies of successful properties. Utilize tools like Rabbu and STR Helper for market analysis, partner with local property management companies familiar with Cabot's regulations, and leverage Facebook groups for Cabot real estate investors and STR operators to gain market insights, while ensuring compliance with city ordinances and HOA restrictions that may impact short-term rental operations.

To obtain an Airbnb/STR permit in Cabot, Arkansas, you must first contact the Cabot City Planning and Zoning Department at City Hall located at 2 South Second Street to determine if short-term rentals are permitted in your specific zoning district, as the city requires compliance with local zoning ordinances. Submit an application for a business license through the City Clerk's office, providing required documents including proof of property ownership or lease agreement, liability insurance certificate (typically $1 million minimum), floor plan of the rental property, parking plan showing adequate off-street parking, and contact information for a local property manager if you're not residing within 50 miles of Cabot. Pay the business license fee of approximately $50-100 annually, along with any zoning compliance fees around $25-75. The application process typically takes 2-4 weeks for review and approval, during which city staff will conduct a zoning compliance review and may require a site inspection. Cabot specifically requires STR operators to maintain the property in accordance with residential neighborhood standards, provide adequate parking (minimum 2 spaces), display the business license number in all advertisements, maintain a guest registry, and ensure 24/7 local contact availability for noise or disturbance complaints. Once approved, renew your permit annually and comply with Arkansas state tax requirements including collecting and remitting applicable sales and tourism taxes.

Short-term rentals (STRs) are generally legal in Cabot, Arkansas, as the city has not enacted specific prohibitions against them as of 2024. However, STR operators must comply with standard business licensing requirements and zoning regulations that may restrict operations in certain residential areas. The city requires STR properties to obtain proper business licenses and adhere to occupancy limits, noise ordinances, and parking requirements. Recent trends in Arkansas municipalities suggest increasing regulation of STRs, with some cities implementing registration systems and safety inspections, though Cabot has maintained a relatively permissive approach compared to larger cities like Little Rock or Fayetteville which have implemented more comprehensive STR ordinances. Property owners should verify current zoning compliance and obtain necessary permits before operating, as enforcement has become more active statewide since 2022, and neighboring communities have adopted stricter regulations that could influence future policy changes in Cabot.

The best areas for Airbnb investment in Cabot, Arkansas include the historic downtown district near Main Street, which attracts visitors interested in small-town charm and local events like the annual Cabot Strawberry Festival. The neighborhoods around Cabot High School and near Highway 67/167 corridor are ideal for business travelers and families visiting students, offering convenient access to Little Rock (approximately 20 miles away) while maintaining lower property costs. Areas near Greystone Golf & Country Club appeal to golf tourists and weekend getaways, while properties close to Dupree Park and the Cabot Recreation Complex attract families participating in youth sports tournaments and outdoor activities. The residential areas along Highway 5 provide good investment potential due to their proximity to major employers like Walmart distribution centers and healthcare facilities in nearby Sherwood and North Little Rock, making them attractive for extended business stays and relocating professionals seeking temporary housing.

In Cabot, Arkansas, Airbnb hosts are subject to Arkansas state sales tax of 6.5% on gross rental receipts, which applies to short-term rentals under 30 days, and this tax is typically collected by Airbnb directly from guests and remitted to the Arkansas Department of Finance and Administration on behalf of hosts through their voluntary collection agreement established in 2018. Additionally, hosts may be subject to Lonoke County sales tax, though the specific rate varies by jurisdiction within the county, and the City of Cabot may impose local occupancy or tourism taxes, estimated at approximately 2-3%, though hosts should verify current rates with the city clerk's office. Collection typically occurs through the booking platform when available, but individual hosts may need to register for a sales tax permit and file monthly or quarterly returns if collecting taxes independently. Exemptions generally apply to rentals exceeding 30 consecutive days, which are considered long-term leases rather than transient accommodations, and some jurisdictions may exempt rentals to permanent residents or government employees on official business.

Starting an Airbnb in Cabot, Arkansas 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 beds, living room furniture, kitchen essentials, linens, and decor. Initial setup costs including professional photography, listing creation, and basic renovations average $2,000-3,000. Permits and fees in Arkansas generally total $300-500 for business licenses and short-term rental permits. Insurance premiums for short-term rental coverage cost approximately $1,200-1,800 annually. Utility setup and deposits for electricity, water, gas, internet, and cable run about $500-800 initially. First six months of operating costs including utilities ($150/month), cleaning services ($75 per turnover), maintenance reserves ($200/month), property management software ($50/month), and marketing expenses total approximately $3,500-5,000, assuming 60-70% occupancy rates typical for the Little Rock metropolitan area market.

Airbnb properties in Cabot, Arkansas typically generate modest profitability with average nightly rates ranging from $75-120 depending on property size and amenities, resulting in monthly revenues of $1,800-3,600 for well-managed properties with 60-70% occupancy rates. Operating expenses generally consume 40-50% of gross revenue, including cleaning fees ($30-50 per turnover), property management (10-20% of revenue), utilities ($150-250 monthly), insurance ($100-200 monthly), and maintenance costs ($200-400 monthly), leaving net profit margins of 25-35% for successful operators. Success factors in this Central Arkansas market include proximity to Little Rock (20 miles), competitive pricing against local hotels like Hampton Inn and Holiday Inn Express, professional photography, responsive guest communication, and targeting business travelers and families visiting nearby attractions like the Arkansas River Trail. Properties near downtown Cabot or with unique amenities like pools or game rooms typically outperform standard residential listings, with some hosts reporting annual profits of $8,000-15,000 on single-family homes after accounting for mortgage payments, though seasonal fluctuations and competition from approximately 50-75 active Airbnb listings in the area require strategic pricing and marketing to maintain consistent bookings.

Airbnb investments in Cabot, Arkansas typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10%, based on the area's proximity to Little Rock and growing suburban appeal. Properties in Cabot, particularly 3-4 bedroom homes priced between $150,000-$250,000, can achieve average daily rates of $85-$120 with occupancy rates around 65-75% annually. Investors can expect to reach profitability within 18-24 months, with gross rental yields averaging 10-14% before expenses. The market benefits from Cabot's family-friendly reputation, local events, and business travelers visiting nearby Little Rock, with properties typically generating $1,800-$2,800 monthly gross revenue. After accounting for cleaning fees, utilities, property management (typically 15-25%), and maintenance costs, net cash-on-cash returns stabilize around 7-9% annually, making the timeframe to full investment recovery approximately 8-12 years depending on initial capital investment and financing structure.

STRSearch is a leading national platform that helps investors identify profitable short-term rental properties in Cabot, Arkansas, using data analytics to evaluate potential returns. Local real estate agents in Cabot who specialize in investment properties include Coldwell Banker Collins-Maury (established 1950s), RE/MAX Real Estate Partners, and Keller Williams Realty agents who focus on the Central Arkansas market. National services like Awning (founded 2017), RedAwning, and Mashvisor provide market analysis and property management solutions for Airbnb investors in the Cabot area. Local property management companies such as Arkansas Rental Management and Central Arkansas Property Solutions offer turnkey services for short-term rental operations. Additional national platforms like BiggerPockets, Roofstock (launched 2015), and AirDNA provide market data and investment analysis tools specifically for the Greater Little Rock metropolitan area, which includes Cabot. Local mortgage brokers and lenders familiar with investment property financing in Arkansas include Arvest Bank, First Security Bank, and Centennial Bank, all of which have been serving the Arkansas market for decades and understand the local short-term rental investment landscape.