Is Coalfield, Tennessee Good for Airbnb Investment?

To start an Airbnb in Coalfield, Tennessee, begin by researching Morgan County's zoning regulations and contacting the county clerk's office at (423) 346-6288 to verify short-term rental requirements, as Coalfield falls under county jurisdiction rather than having its own municipal regulations. Obtain necessary permits including a business license from Morgan County ($25-50 annually), Tennessee state sales tax permit from the Department of Revenue, and ensure compliance with fire safety codes through the local fire marshal's office. Find a suitable property by searching rural areas around Highway 62 or near Obed Wild and Scenic River, considering properties with 2-3 bedrooms priced between $80,000-150,000 that offer outdoor recreation access. Furnish the property with rustic, cabin-style decor emphasizing the area's natural beauty, including essential amenities like high-speed internet (available through Charter Spectrum or local providers), full kitchen, comfortable bedding, and outdoor furniture for porches or decks. List your property on Airbnb, VRBO, and Booking.com with competitive pricing of $75-125 per night, highlighting proximity to Obed River activities, hiking trails, and peaceful rural setting. Manage the property by establishing relationships with local cleaning services in nearby Wartburg or Harriman, creating a guidebook featuring local attractions like Catoosa Wildlife Management Area and Frozen Head State Park, and maintaining responsive communication with guests while ensuring compliance with Tennessee's 9.25% combined state and local occupancy taxes.

To identify profitable short-term rental properties in Coalfield, Tennessee, focus on properties within 10-15 minutes of Cove Lake State Park and Norris Dam State Park, as these outdoor recreation areas drive significant tourist traffic year-round. Target 2-4 bedroom cabins or homes with mountain views, hot tubs, fire pits, and outdoor spaces that appeal to families and groups seeking nature retreats, with properties built after 1990 typically performing better due to modern amenities. Pricing analysis should benchmark against comparable STRs in nearby Caryville and LaFollette, aiming for $80-150 per night depending on size and amenities, with peak seasons during summer months and fall foliage periods commanding 20-30% premiums. Research competition using AirDNA and STR analytics tools to identify gaps in the market, particularly focusing on properties that offer unique features like lakefront access, hiking trail proximity, or authentic Tennessee cabin experiences. Utilize resources such as the Campbell County tourism board data, Tennessee State Parks visitor statistics, and local real estate platforms like MLS to analyze property values, with successful STR properties in this market typically generating 15-25% annual returns when properly managed and marketed to outdoor enthusiasts visiting the Big South Fork region and Cumberland Mountains.

To obtain an Airbnb/STR permit in Coalfield, Tennessee, you must first contact the Morgan County Planning and Zoning Department since Coalfield is an unincorporated community within Morgan County. Submit an application for a short-term rental permit along with required documents including property deed or lease agreement, proof of liability insurance (minimum $1 million coverage), floor plan of the rental property, septic system inspection certificate, and Tennessee state sales tax registration. The application fee is approximately $150-200 with an annual renewal fee of $100. You must also register with the Tennessee Department of Revenue for state and local occupancy taxes, obtain a business license from Morgan County ($50-75), and ensure the property meets all building and fire safety codes with working smoke detectors in each bedroom and common area. The approval process typically takes 30-45 days after submission of complete documentation. Coalfield-specific requirements include maintaining a local contact person available 24/7, limiting occupancy to no more than 2 people per bedroom plus 2 additional guests, providing adequate parking spaces (minimum 2 spaces), and ensuring the property maintains residential character without commercial signage. Properties must also comply with septic system capacity limits and well water testing if applicable, with annual inspections required for permit renewal.

Short-term rentals (STRs) in Coalfield, Tennessee are generally legal but subject to state and local regulations. As a small unincorporated community in Morgan County, Coalfield falls under Tennessee state law which permits STRs statewide as of 2021 legislation that prevented local governments from completely banning them. However, Morgan County and the local community may impose specific zoning restrictions, occupancy limits, safety requirements, and registration or permitting processes. Properties must typically comply with fire safety codes, have proper egress routes, and may face restrictions in certain residential zones to preserve neighborhood character. Recent changes include Tennessee's 2021 law requiring local governments to allow STRs while permitting reasonable regulations, and many rural Tennessee communities have since developed permitting systems and noise ordinances. Property owners in Coalfield should verify current Morgan County regulations regarding business licenses, tax collection requirements, and any specific zoning limitations that may apply to their particular location within the community.

The best areas for Airbnb investment in Coalfield, Tennessee are primarily concentrated around Norris Dam State Park and the Clinch River corridor, which attract outdoor enthusiasts year-round for fishing, boating, hiking, and camping activities. The historic downtown Coalfield area offers potential due to its proximity to the Museum of Appalachia in nearby Norris, drawing heritage tourists and visitors interested in Appalachian culture. Properties near Cove Lake State Park benefit from consistent tourism traffic, particularly during spring and fall when visitors come for scenic beauty and outdoor recreation. The areas along Highway 61 and close to Norris Lake provide excellent investment opportunities as they serve both recreational visitors and business travelers working in the nearby Oak Ridge National Laboratory and Department of Energy facilities. Additionally, neighborhoods within a 10-mile radius of the Big South Fork National River and Recreation Area capture overflow tourism from this major attraction, while properties accessible to both Norris and Melton Hill Lakes can command premium rates during peak boating and fishing seasons from April through October.

Airbnb properties in Coalfield, 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. Additionally, Morgan County (where Coalfield is located) imposes a local hotel/motel tax of approximately 5% on transient accommodations, which Airbnb also collects and remits automatically for stays under 30 days. Properties rented for 30 days or longer are typically exempt from these transient occupancy taxes. The Tennessee Department of Revenue requires registration for short-term rental operators, though many compliance requirements are handled through Airbnb's tax collection service that began in 2019. Local business licenses may be required by Morgan County, and hosts should verify current rates and requirements as tax policies for short-term rentals have evolved significantly since 2020 with increased enforcement and standardization of collection procedures.

The total cost to start an Airbnb in Coalfield, Tennessee is approximately $185,000-$225,000. Property purchase costs around $120,000-$150,000 based on median home prices in rural Tennessee markets. Furnishing a 2-3 bedroom property requires $15,000-$25,000 for furniture, appliances, linens, and décor to create an attractive rental space. Initial setup costs including professional photography, listing creation, and basic renovations total $3,000-$5,000. Permits and fees vary but expect $500-$1,500 for business licenses, short-term rental permits, and inspection fees. Insurance specifically for short-term rentals costs $1,200-$2,000 annually, significantly higher than standard homeowner's insurance. Utility setup and deposits for electricity, water, internet, and cable run $500-$800. First six months of operating costs including utilities ($600/month), cleaning services ($100-150 per turnover), maintenance reserves ($200/month), property management software ($50/month), and marketing expenses total approximately $6,000-$8,000, assuming 50-60% occupancy rates typical for rural Tennessee markets.

Airbnb properties in Coalfield, 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 assuming 60-70% occupancy rates. Operating expenses typically consume 40-50% of gross revenue, including cleaning fees ($30-50 per turnover), property management (15-25%), utilities ($150-200 monthly), insurance ($800-1,200 annually), and maintenance costs ($2,000-3,500 yearly). Net profit margins generally fall between 25-35% for well-managed properties, with successful hosts in the region reporting annual net profits of $6,000-12,000 per property. Success factors include proximity to Cove Lake State Park and Norris Dam State Park which drive weekend tourism, competitive pricing against nearby Caryville and LaFollette properties, professional photography, and responsive guest communication. Properties featuring outdoor amenities like fire pits, hot tubs, or lake access command premium rates of $130-180 nightly and achieve higher occupancy rates of 75-80%, with some hosts reporting net margins exceeding 40% by 2023.

Based on Coalfield, Tennessee market conditions, Airbnb investments typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 15-22% for well-positioned properties. The rural location near outdoor recreation areas like Frozen Head State Park creates seasonal demand fluctuations, with peak occupancy rates of 65-75% during spring and fall months dropping to 35-45% in winter. Initial profitability usually occurs within 18-24 months for properties purchased under $150,000 with renovation costs kept below $25,000. Properties targeting outdoor enthusiasts and visitors to nearby Oak Ridge or Cookeville can achieve average daily rates of $85-120, though the limited local tourism infrastructure means investors should expect longer vacancy periods compared to major Tennessee markets. The timeframe to break-even on initial investment typically extends to 6-8 years due to the smaller market size and seasonal nature of demand in this rural Tennessee community.

STRSearch is a leading national platform that specializes in identifying profitable short-term rental properties for Airbnb investors in Coalfield, Tennessee. Local real estate agents serving the Coalfield area include Realty Executives Associates and Century 21 Cumberland Realty, both of which have experience with investment properties in rural Tennessee markets. National services like Awning, RedAwning, and Vacasa provide comprehensive Airbnb investment analysis and property management services that cover the Tennessee market. AirDNA offers market data and analytics specifically for short-term rental investments in smaller Tennessee markets like Coalfield. Local property management companies such as Tennessee Mountain Rentals and Smoky Mountain Property Management have expanded their services to cover investment properties in the Coalfield region since 2020. BiggerPockets marketplace and Roofstock occasionally feature Tennessee mountain properties suitable for Airbnb conversion. Real estate investment firms like HomeVestors and We Buy Ugly Houses have been active in the Tennessee market, sometimes offering properties suitable for short-term rental conversion in rural areas like Coalfield.