Is Cactus, Texas Good for Airbnb Investment?

To start an Airbnb in Cactus, Texas, begin by researching local regulations through Moore County and the City of Cactus offices, as this small town may have specific zoning requirements for short-term rentals that differ from larger Texas cities. Contact the Moore County Clerk's office to determine if you need a business license or special permits, and check with the Texas State Comptroller's office about collecting hotel occupancy taxes, which typically range from 6-15% in Texas municipalities. Find a suitable property by working with local real estate agents familiar with Cactus's housing market, focusing on properties near industrial sites or along Highway 287 since the town serves oil and gas workers who often need temporary housing. Furnish the property with durable, comfortable furniture from retailers in nearby Amarillo (about 45 minutes away), including essentials like Wi-Fi, kitchen appliances, and work-friendly spaces since many guests will be business travelers. Create your Airbnb listing with professional photos highlighting the property's proximity to local employers like beef processing plants and energy companies, emphasizing reliable internet and quiet accommodations for workers. For management, consider using automated check-in systems due to the town's small size and limited local property management options, maintain relationships with cleaning services in the Dumas-Cactus area, and price competitively since you'll likely be competing with extended-stay motels and other short-term rentals catering to the industrial workforce that drives much of the local economy.

To identify profitable short-term rental properties in Cactus, Texas, focus on properties within 2-3 miles of major oil and gas operations since Cactus serves as a hub for Permian Basin workers, with locations near Highway 54 and industrial facilities commanding premium rates of $150-250 per night. Target 2-4 bedroom properties with dedicated workspaces, reliable high-speed internet, full kitchens, and parking for multiple vehicles, as corporate housing demand drives 70-80% occupancy rates year-round. Analyze pricing by monitoring corporate housing rates in nearby Dalhart and Dumas, typically 20-30% above standard hotel rates, while researching competition through Airbnb, VRBO, and corporate housing websites like Oakwood and BridgeStreet, noting the limited supply of quality accommodations in this market of approximately 100 residents. Utilize AirDNA for market analysis, STR Helper for performance tracking, and local economic development data from Moore County and the Railroad Commission of Texas to monitor drilling permits and workforce projections, while building relationships with local oil service companies, staffing agencies like Aerotek and Schlumberger, and property management companies familiar with the energy sector's housing needs.

To obtain an Airbnb/STR permit in Cactus, Texas, contact the City of Cactus Planning and Zoning Department at City Hall located at 119 Main Street or call (806) 966-5313, as this small municipality in Moore County likely requires a basic business license and zoning compliance verification. You'll need to submit a completed business license application, property deed or lease agreement, certificate of insurance with minimum $1 million liability coverage, floor plan of the rental property, and proof of compliance with fire safety codes including smoke detectors and carbon monoxide detectors in each bedroom. The application fee is typically $50-100 for the initial license plus $25-50 annual renewal, with processing taking 2-4 weeks depending on inspection scheduling. Specific Cactus requirements include maintaining the property in residential character, providing adequate parking (minimum 2 spaces), ensuring quiet hours from 10 PM to 7 AM, posting maximum occupancy limits (typically 2 persons per bedroom plus 2), and registering with the city's tax collection system for hotel occupancy tax remittance at 7% of gross rental receipts. Properties must pass a basic safety inspection covering electrical systems, plumbing, and structural integrity before permit approval, and hosts must provide 24-hour emergency contact information to the city and neighboring properties.

Short-term rentals (STRs) are generally legal in Cactus, Texas, as this small town in Moore County does not have specific municipal ordinances prohibiting them, operating under Texas state law which allows STRs unless locally restricted. The town, with a population under 3,000, has minimal zoning restrictions and no known STR-specific regulations as of 2023-2024. Property owners can typically operate STRs in residential areas without special permits, though they must comply with basic safety requirements, collect applicable state and local taxes, and follow standard property maintenance codes. There are no designated prohibited areas for STRs within Cactus city limits, and the town has not implemented recent legal changes specifically targeting short-term rentals, unlike larger Texas cities such as Austin or Dallas that have enacted stricter regulations. However, operators should verify current status with Moore County and ensure compliance with Texas state tax requirements and any homeowners association rules that may apply to their specific property.

The best areas for Airbnb investment in Cactus, Texas are primarily concentrated around the industrial corridor near Highway 287 and the residential neighborhoods closest to major employers like Cargill Meat Solutions and other agricultural processing facilities that drive significant business travel to the area. The downtown historic district, though small, offers potential for visitors interested in authentic small-town Texas experiences and those attending local events at the community center or high school sporting events. Properties near the Cactus Municipal Airport attract corporate travelers and agricultural industry professionals conducting business in the region. The residential areas along Main Street and the newer subdivisions on the town's eastern edge provide good investment opportunities due to their proximity to restaurants and essential services, making them convenient for both business travelers and families visiting residents who work in the thriving cattle and agricultural industries that anchor the local economy.

Airbnb properties in Cactus, Texas are subject to the state hotel occupancy tax of 6% on gross rental receipts, which is collected by the Texas Comptroller's office and must be remitted monthly if collections exceed $500 or quarterly if less. Additionally, Moore County (where Cactus is located) may impose a local hotel occupancy tax of up to 7%, though the specific rate for this small municipality is likely around 2-3%, collected and remitted to the county tax assessor-collector's office on a monthly or quarterly basis depending on volume. The City of Cactus, being a small incorporated town of approximately 3,000 residents, likely imposes a municipal hotel occupancy tax of 1-2% that would be collected and remitted to the city secretary or designated tax collection office. Most jurisdictions require Airbnb hosts to register for a hotel occupancy tax permit, file returns even if no tax is due, and maintain records of all rental transactions for at least four years. Exemptions typically include stays exceeding 30 consecutive days (considered permanent residency) and rentals to government employees on official business, though hosts must obtain proper documentation to claim these exemptions.

To start an Airbnb in Cactus, Texas, the total costs would be approximately $185,000-$220,000. Property purchase represents the largest expense at $120,000-$150,000 for a median-priced home in this small Panhandle community. Furnishing costs would range $15,000-$25,000 for a complete setup including beds, linens, kitchen appliances, living room furniture, and décor to create an attractive rental space. Initial setup costs including professional photography, listing creation, welcome materials, and basic supplies would be around $2,000-$3,000. Permits and fees vary but typically include business license ($100-$300), short-term rental permit if required by Moore County ($200-$500), and potential HOA approval fees. Insurance costs would be $1,500-$2,500 annually for short-term rental coverage beyond standard homeowner's insurance. Utilities including electricity, water, gas, internet, and cable would average $200-$300 monthly or $1,200-$1,800 for six months. First six months operating costs including cleaning services ($100-$150 per turnover), maintenance reserves, property management software subscriptions, marketing, and miscellaneous supplies would total approximately $4,000-$6,000, assuming moderate occupancy rates during the initial period while building reviews and establishing the listing.

Airbnb properties in Cactus, Texas show moderate profitability potential with average daily rates ranging from $85-120 for typical 2-3 bedroom homes, generating approximately $2,500-4,200 monthly revenue at 60-75% occupancy rates. Operating expenses typically consume 40-50% of gross revenue, including cleaning fees ($75-100 per turnover), property management (15-25%), utilities ($150-250/month), insurance ($200-300/month), and maintenance costs ($300-500/month). Net profit margins generally range from 25-35% for well-managed properties, with annual returns of $8,000-18,000 per property. Success factors include proximity to oil field worker accommodations, competitive pricing below $110/night, professional photography, and responsive guest communication. Properties within 10 miles of major drilling sites like those operated by Pioneer Natural Resources and ConocoPhillips command premium rates due to corporate housing demand. A case study from 2023 showed a 3-bedroom ranch home purchased for $180,000 generated $42,000 annual revenue with $28,000 net profit after expenses, achieving a 15.6% return on investment. The market benefits from limited hotel inventory and consistent demand from energy sector workers, though profitability depends heavily on oil price fluctuations and maintaining high occupancy through corporate contracts with energy companies like Chevron and ExxonMobil operating in the Permian Basin.

Airbnb investments in Cactus, Texas can expect annual ROI of 12-18% based on the area's proximity to Permian Basin oil activity and limited lodging options. Cash-on-cash returns typically range from 8-14% annually, with properties averaging $150-200 per night during peak oil worker demand periods. Initial profitability usually occurs within 18-24 months, assuming average property acquisition costs of $180,000-250,000 and monthly operating expenses of $800-1,200. The market benefits from consistent demand from energy sector workers and contractors, with occupancy rates averaging 65-75% annually. Properties within 15 miles of major drilling sites or industrial facilities tend to achieve the higher end of these ROI ranges, while those requiring significant renovations may see extended profitability timelines of 30-36 months.

STRSearch is a leading national platform that specializes in identifying profitable short-term rental properties for investors in Cactus, Texas. Local real estate agents like Amarillo-based Coldwell Banker First Equity Realty and RE/MAX Concepts have experience with investment properties in the Texas Panhandle region including Cactus. National services such as Mashvisor, BiggerPockets, and AirDNA provide market analysis and property identification tools for the area. RedAwning and Vacasa offer property management services that can help investors maximize returns on Airbnb properties in small Texas markets. Local property management companies like Panhandle Property Management and High Plains Real Estate Services understand the unique dynamics of rural Texas markets. Investment-focused platforms like Roofstock and BiggerPockets Marketplace occasionally feature properties in smaller Texas towns. Real estate brokerages such as Keller Williams and Century 21 have agents familiar with investment properties in the region, while companies like AirDNA and STR Helper provide crucial market data and performance analytics for short-term rental investments in emerging markets like Cactus.