Is Coventry, Rhode Island Good for Airbnb Investment?

To start an Airbnb in Coventry, Rhode Island, begin by researching local zoning laws and regulations through the Coventry Planning Department, as the town typically requires short-term rentals to comply with residential zoning restrictions and may require a home occupation permit or special use permit depending on your property type and rental frequency. Contact the Rhode Island Department of Health for any required lodging licenses and ensure compliance with state tax requirements by registering with the Rhode Island Division of Taxation for hotel tax collection (approximately 5-7% state tax plus local taxes). Find a suitable property in residential zones that allow short-term rentals, focusing on areas near Coventry's recreational attractions like Johnson's Pond or close to major highways for easy access to Providence and other destinations. Obtain necessary permits from Coventry Town Hall, which may include a business license, certificate of occupancy, and fire safety inspection, with costs typically ranging $100-500 depending on property size and requirements. Furnish the property with quality furniture, linens, kitchen essentials, and safety equipment including smoke detectors, carbon monoxide detectors, and fire extinguishers as required by Rhode Island fire codes. Create your Airbnb listing with professional photos highlighting nearby attractions like Carbuncle Pond and Washington Secondary Trail, set competitive pricing based on comparable properties in the area (typically $80-150 per night for standard homes), and implement a management system for bookings, cleaning between guests, key exchange, and guest communication while maintaining detailed records for tax purposes and regulatory compliance.

To identify profitable short-term rental properties in Coventry, Rhode Island, focus on locations near Carbuncle Pond, Johnson's Pond, and properties within 15-20 minutes of Providence for business travelers, while targeting homes built after 1980 with 2-4 bedrooms, full kitchens, outdoor spaces, and parking since the area attracts families and outdoor enthusiasts. Conduct pricing analysis using AirDNA and Mashvisor to benchmark against similar properties in nearby Warwick and West Greenwich, aiming for $100-200 per night depending on size and amenities, while researching competition through Airbnb and VRBO searches within a 5-mile radius to identify gaps in luxury or pet-friendly offerings. Utilize Rhode Island MLS data, Zillow rental estimates, and local Facebook groups like "Coventry RI Community" for market insights, while considering properties near Route 95 for accessibility and ensuring compliance with Coventry's zoning regulations through the town's planning department, as the market benefits from proximity to both Providence business district and Connecticut casinos like Foxwoods and Mohegan Sun.

To obtain an Airbnb/STR permit in Coventry, Rhode Island, you must first contact the Coventry Building Department at Town Hall located at 1670 Flat River Road to inquire about short-term rental regulations and obtain application forms, as the town requires a special use permit for properties operating as short-term rentals for less than 30 days. Required documents typically include a completed application form, proof of property ownership or lease agreement, floor plans of the rental space, proof of liability insurance (minimum $1 million coverage), fire safety inspection certificate from the Coventry Fire Department, septic system inspection if applicable, and a site plan showing parking areas and property boundaries. The application fee is estimated at $150-300 plus additional inspection fees of approximately $100-200, and you may need to pay for required inspections separately. The timeline typically takes 4-8 weeks from submission to approval, depending on inspection scheduling and any required modifications to meet safety codes. Specific Coventry requirements include maintaining adequate off-street parking (typically 2 spaces minimum), ensuring the property meets all fire safety codes including smoke and carbon monoxide detectors, obtaining annual renewals, maintaining a local contact person available 24/7 for emergencies, and complying with noise ordinances and occupancy limits based on septic capacity and square footage, with most properties limited to 2 people per bedroom plus 2 additional guests.

Short-term rentals (STRs) are generally legal in Coventry, Rhode Island, but operate under state and local regulations that have evolved significantly since 2019. Rhode Island legalized STRs statewide in 2017, requiring hosts to register with the state, collect occupancy taxes, and maintain liability insurance, while Coventry has implemented its own local ordinances requiring special use permits for STRs in residential zones. The town typically restricts STRs in certain residential neighborhoods to preserve community character, with requirements for off-street parking, occupancy limits based on septic capacity, and compliance with health and safety codes. Recent changes around 2020-2022 have included stricter enforcement of registration requirements and enhanced penalties for non-compliance, with some areas near Coventry's rural and historic districts facing additional scrutiny. Property owners must obtain both state registration through the Rhode Island Division of Taxation and local permits from Coventry's planning department, with violations potentially resulting in fines up to $1,000 per day, making compliance essential for legal operation in this Kent County community.

The best areas for Airbnb investment in Coventry, Rhode Island include the western lakefront districts near Tiogue Lake and Johnson's Pond, which attract summer tourists and weekend visitors seeking waterfront recreation and fishing activities. The Route 95 corridor area near the Connecticut border offers strong potential due to business travelers and visitors to nearby Foxwoods Resort Casino (1992) and Mohegan Sun Casino, with many guests preferring alternative accommodations. The historic village center around Main Street provides charm for visitors exploring Rhode Island's colonial heritage and serves as a convenient base for day trips to Newport, Providence, and coastal attractions. The residential neighborhoods near Carbuncle Pond offer peaceful retreats for families and groups visiting the region's state parks and outdoor recreation areas. Additionally, properties near the Washington Secondary Bike Path attract cycling enthusiasts and outdoor recreation tourists, while the areas close to the Rhode Island border with Connecticut capture overflow demand from Mystic Seaport and other southeastern Connecticut attractions.

In Coventry, Rhode Island, Airbnb hosts are subject to Rhode Island's state hotel tax of 5% on gross receipts from short-term rental accommodations, which applies to stays of less than 30 consecutive days. This tax is collected by the Rhode Island Division of Taxation and hosts must register for a hotel tax permit, file monthly returns by the 20th of the following month, and remit payments electronically through the state's tax portal. Additionally, hosts may be subject to Rhode Island's 7% state sales tax on the rental income. Coventry itself does not impose a separate local lodging tax as of 2023, though hosts must still comply with local zoning and registration requirements. The state hotel tax applies to all short-term rentals regardless of the number of rooms or frequency of rental, with limited exemptions only for stays exceeding 30 consecutive days or rentals to permanent residents. Airbnb may collect and remit these taxes on behalf of hosts in Rhode Island through their automated tax collection service, but hosts remain ultimately responsible for ensuring compliance and should verify that taxes are being properly collected and remitted.

To start an Airbnb in Coventry, Rhode Island, expect total costs around $385,000-$425,000. Property purchase represents the largest expense at approximately $350,000 based on median home prices in the area as of 2023-2024. Furnishing costs typically range $15,000-$25,000 for a complete 2-3 bedroom home including furniture, bedding, kitchenware, and decor to create an attractive rental space. Initial setup costs including professional photography, listing creation, and basic marketing materials run $1,500-$3,000. Permits and fees in Rhode Island include business registration ($50), potential local permits ($200-$500), and tax registration which varies by municipality. Insurance costs approximately $2,000-$3,500 annually for short-term rental coverage beyond standard homeowner's insurance. Utility setup and deposits for electricity, gas, water, internet, and cable total around $500-$800 initially. First six months operating costs including utilities ($1,200), cleaning services ($2,400), maintenance reserves ($1,500), property management software ($300), and marketing ($800) add approximately $6,200. Additional considerations include potential HOA fees, property taxes, and emergency repair funds which could add $3,000-$8,000 to initial capital requirements.

Airbnb properties in Coventry, Rhode Island typically generate annual revenues between $15,000-$35,000 for entire home listings, with average daily rates ranging from $85-$150 depending on property size and amenities. Operating expenses generally consume 40-60% of gross revenue, including cleaning fees ($50-$75 per turnover), property management (10-20% of revenue), utilities ($200-$400 monthly), insurance ($1,200-$2,000 annually), and maintenance costs averaging $2,000-$4,000 yearly. Properties near Coventry's recreational areas like Johnson's Pond or those offering rural retreats tend to achieve higher occupancy rates of 60-75% compared to the state average of 50-65%. Successful hosts in the area typically maintain profit margins of 25-40% by focusing on properties with 3+ bedrooms that can accommodate families visiting nearby attractions or attending events at venues like Goddard Memorial State Park. The market benefits from Coventry's proximity to Providence (20 minutes) and Newport (45 minutes), allowing hosts to capture overflow demand during peak tourism seasons, with properties featuring amenities like hot tubs, fire pits, or waterfront access commanding premium rates and achieving the highest profitability in the local market.

Based on Coventry, Rhode Island market conditions, Airbnb investments typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10% depending on property type and location within the town. Properties near Carbuncle Pond or close to major highways like Route 95 tend to perform better, with investors seeing profitability within 18-24 months of operation. The market benefits from proximity to Providence (20 minutes) and seasonal demand from visitors to nearby beaches and state parks, with average daily rates of $85-120 and occupancy rates of 65-75% annually. Initial investment requirements typically range from $40,000-80,000 for down payments on suitable properties, with gross rental yields averaging 10-14% before expenses, making the timeframe to break-even approximately 2-3 years when factoring in renovation costs, permits, and operational expenses.

STRSearch is a leading national platform that helps investors identify profitable short-term rental properties in Coventry, Rhode Island, using data analytics and market insights. Local real estate agents like those at Residential Properties Ltd and RE/MAX Newport County have experience with investment properties in the Coventry area and understand the local vacation rental market dynamics. Mashvisor provides nationwide Airbnb investment analysis tools that can help evaluate properties in Coventry's market, while BiggerPockets connects investors with local Rhode Island real estate professionals who specialize in rental property investments. AirDNA offers short-term rental market data and analytics for the Coventry region to help investors make informed decisions. Local property management companies like Ocean State Property Management and Rhode Island Vacation Rentals can assist with both finding suitable properties and managing them post-purchase. National services like Roofstock and Awning also provide investment property search tools and market analysis that cover the Rhode Island market, including opportunities in Coventry's growing short-term rental sector near recreational areas and the Connecticut border.