Is Caryville, Tennessee Good for Airbnb Investment?

To start an Airbnb in Caryville, Tennessee, begin by researching local regulations through Campbell County and Caryville city offices, as Tennessee generally allows short-term rentals but local municipalities may have specific requirements including business licenses, occupancy permits, and zoning compliance. Obtain necessary permits including a Tennessee business license, local business permit from Caryville City Hall, and ensure your property meets fire safety and building codes which may require inspections. Find a suitable property by researching Caryville's residential areas near Cove Lake State Park or downtown, considering properties that comply with local zoning laws for short-term rentals, with average property prices ranging $80,000-$150,000 in the area. Furnish the space with essential amenities including comfortable bedding, kitchen supplies, WiFi, heating/cooling systems suitable for Tennessee's climate, and local touches highlighting Caryville's proximity to outdoor recreation and the Big South Fork area. List your property on Airbnb and other platforms like VRBO, setting competitive rates around $60-$120 per night based on local market analysis, creating attractive photos showcasing the property and nearby attractions like Norris Dam and Cumberland Gap. Manage your Airbnb by establishing cleaning protocols between guests, responding promptly to inquiries, coordinating check-ins/check-outs, maintaining the property regularly, collecting and remitting applicable Tennessee state sales tax (currently 7%) plus any local occupancy taxes, and ensuring compliance with ongoing permit renewals and local regulations that may evolve in Campbell County.

To identify profitable short-term rental properties in Caryville, Tennessee, focus on locations within 15-20 minutes of Cove Lake State Park and Big South Fork National River, as outdoor recreation drives significant tourism demand in this rural area. Target 2-4 bedroom cabins or homes with rustic charm, outdoor amenities like fire pits, hot tubs, or large decks, and modern conveniences including reliable WiFi and full kitchens, as guests seek authentic mountain experiences with comfort. Analyze pricing by researching comparable Airbnb and VRBO listings within a 25-mile radius including nearby Jacksboro and Williamsburg, aiming for properties that can command $80-150 per night depending on size and amenities. Conduct competition research using AirDNA and Mashvisor to assess occupancy rates and seasonal demand patterns, noting that peak seasons align with spring through fall outdoor activities and hunting seasons. Utilize tools like BiggerPockets for investment analysis, STR Helper for market data, and local resources such as Campbell County tourism boards and real estate agents familiar with the Norris Lake and Big South Fork regions to identify undervalued properties with strong rental potential in this emerging mountain tourism market.

To obtain an Airbnb/STR permit in Caryville, Tennessee, you must first contact the Caryville City Hall at 423-562-7640 or visit their office at 301 Main Street to inquire about short-term rental regulations, as the city may require a business license and zoning compliance verification. Submit an application for a business license (estimated $25-50 fee) along with required documents including property deed or lease agreement, proof of insurance with minimum $1 million liability coverage, floor plan of the rental unit, and completed STR registration form. You'll need to schedule a safety inspection with the local fire department (estimated $75-100 fee) to verify smoke detectors, carbon monoxide detectors, fire extinguishers, and proper egress routes are installed. Obtain zoning approval from Campbell County Planning Commission (estimated $50-75 fee) confirming the property is in an area that permits short-term rentals, and provide neighbor notification letters within 200 feet of the property. Pay all applicable fees including the business license, inspection fees, and any zoning permits, then await final approval which typically takes 30-45 days from complete application submission. Once approved, you must display the permit number in all online listings and renew annually, while maintaining compliance with occupancy limits (typically 2 guests per bedroom plus 2 additional), quiet hours from 10 PM to 7 AM, and parking requirements of one space per bedroom.

Short-term rentals (STRs) in Caryville, Tennessee are generally legal but subject to state regulations and potential local ordinances. Tennessee passed comprehensive STR legislation in 2021 that preempted most local bans while allowing municipalities to regulate through zoning, safety requirements, and registration processes. Caryville, a small town in Campbell County, likely follows the state framework which permits STRs in residential areas unless specifically prohibited by local zoning ordinances. The town may require business licenses, impose occupancy limits, mandate safety equipment like smoke detectors, and establish noise or parking restrictions. Given Caryville's rural character and proximity to Cove Lake State Park, STRs are likely permitted to support tourism, though operators should verify current local requirements with the city clerk as smaller municipalities sometimes implement specific registration or operational standards. Recent changes since 2021 have generally favored property owners' rights to operate STRs while maintaining local authority over health, safety, and nuisance issues.

The best areas for Airbnb investment in Caryville, Tennessee are primarily concentrated around the Cove Lake State Park vicinity and properties near the Norris Dam State Park boundary, as these locations attract outdoor enthusiasts, families, and tourists visiting the scenic lake areas and hiking trails year-round. The downtown Caryville area along Highway 25W offers potential for business travelers and visitors to nearby industrial facilities including coal mining operations and the Norris Dam infrastructure. Properties within a 5-mile radius of Cove Lake are particularly attractive due to the park's popularity for fishing, boating, camping, and the annual Cove Lake State Park events that draw visitors from across East Tennessee. The residential areas near the intersection of Highway 25W and Cove Lake Road provide easy access to both natural attractions and the interstate system, making them ideal for guests traveling to nearby Knoxville (45 minutes south) or exploring the Cumberland Gap region, while also serving visitors to Big South Fork National River and Recreation Area who prefer more affordable accommodations outside the immediate park vicinity.

Airbnb properties in Caryville, Tennessee are subject to Tennessee state sales tax of 7% on short-term rental accommodations, which is automatically collected by Airbnb through their platform and remitted directly to the Tennessee Department of Revenue on behalf of hosts. Campbell County, where Caryville is located, imposes an additional local occupancy tax of approximately 5% on transient accommodations, though collection and remittance procedures may vary and some hosts may need to register directly with the county to collect and remit this tax separately. The City of Caryville does not appear to have its own municipal lodging tax as of recent years, but hosts should verify current local ordinances. Tennessee exempts stays of 30 days or longer from these occupancy taxes, and certain government and non-profit travelers may qualify for exemptions with proper documentation. Hosts operating multiple properties or generating significant revenue may need to obtain a business license and register for sales tax collection, with monthly or quarterly remittance required depending on volume, while Airbnb's collection service primarily covers the state portion but may not include all local taxes depending on agreements between the platform and local jurisdictions.

The total cost to start an Airbnb in Caryville, Tennessee is approximately $185,000-$225,000. Property purchase costs around $150,000-$180,000 based on median home prices in rural Tennessee markets. Furnishing a 2-3 bedroom property requires $8,000-$12,000 for beds, sofas, dining sets, appliances, linens, and décor to create an attractive rental space. Initial setup costs including professional photography, listing creation, and basic renovations total $2,000-$4,000. Permits and fees including business license, short-term rental permit, and safety inspections cost approximately $500-$800 annually. Insurance for short-term rentals runs $1,200-$2,000 per year, significantly higher than standard homeowner's policies. Monthly utilities including electricity, water, internet, and cable average $200-$300. First six months of operating costs including utilities ($1,500), cleaning supplies and services ($1,800), maintenance reserves ($1,500), marketing ($600), and property management software ($300) total approximately $5,700. Additional considerations include potential HOA fees, property taxes averaging $1,000-$1,500 annually, and a recommended cash reserve of $5,000-$10,000 for unexpected repairs and vacancy periods.

Airbnb properties in Caryville, Tennessee 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 gross revenue based on 60-70% occupancy rates. Operating expenses typically consume 40-50% of gross revenue, including cleaning fees ($40-60 per turnover), property management (15-25%), utilities ($150-200 monthly), insurance ($1,200-1,800 annually), and maintenance costs averaging $2,000-3,500 yearly. Net profit margins generally range from 15-25% for well-managed properties, with successful hosts in the area reporting annual net profits of $4,000-8,000 per property. Key success factors include proximity to Norris Dam State Park and Cove Lake State Park which drive outdoor recreation demand, competitive pricing strategies, professional photography, and maintaining 4.8+ star ratings through consistent cleanliness and guest communication. Properties within 10 miles of these attractions and featuring amenities like hot tubs, fire pits, or lake access command premium rates and achieve higher occupancy, with some hosts reporting 80%+ occupancy during peak summer and fall seasons, while winter months typically see 40-50% occupancy requiring strategic pricing adjustments to maintain profitability.

Airbnb investments in Caryville, Tennessee typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10%, primarily driven by the area's proximity to Cove Lake State Park and Norris Dam State Park which attract outdoor enthusiasts and families seeking vacation rentals. Properties in Caryville generally reach profitability within 18-24 months, with average daily rates of $85-120 depending on property size and amenities, and occupancy rates averaging 55-65% annually due to seasonal tourism patterns and the town's location along the I-75 corridor. The market benefits from relatively low property acquisition costs compared to larger Tennessee markets, with typical investment properties ranging from $80,000-150,000, allowing investors to achieve positive cash flow within the first year while building equity through moderate appreciation rates of 3-5% annually in this rural Campbell County market.

STRSearch is a leading national platform that specializes in identifying profitable short-term rental investment properties across markets including Caryville, Tennessee. For local expertise, Caryville investors can work with real estate agents from Realty Executives Associates and Century 21, both of which have Tennessee offices and experience with investment properties in the region. National services like Awning (formerly RedAwning) provide comprehensive Airbnb investment analysis and property management services, while Mashvisor offers data-driven investment property analysis tools that cover Tennessee markets. Local real estate professionals such as those at Coldwell Banker Wallace & Wallace and RE/MAX can provide market-specific knowledge of the Caryville area, particularly given its proximity to Cove Lake State Park and Norris Dam State Park which drive tourism demand. Additional national platforms include Roofstock, which focuses on turnkey rental properties, and AirDNA, which provides short-term rental market analytics and investment insights for Tennessee markets including smaller towns like Caryville where cabin and lake-proximity rentals perform well due to outdoor recreation tourism.