Is Dawson, North Dakota Good for Airbnb Investment?

To start an Airbnb in Dawson, North Dakota, begin by researching local zoning laws and regulations through the Dawson city clerk's office, as this small rural community may have specific ordinances regarding short-term rentals, though many smaller North Dakota towns have minimal restrictions compared to larger cities. Contact Kidder County offices to verify any county-level requirements and obtain necessary business licenses, which typically cost $25-50 annually in North Dakota. Since Dawson has limited existing rental properties, consider purchasing a modest 2-3 bedroom home for $80,000-120,000 or converting an existing property, ensuring it meets basic safety requirements including smoke detectors, carbon monoxide detectors, and adequate egress windows. Furnish the property with durable, comfortable furniture from retailers like Menards or online sources, budgeting $8,000-15,000 for a complete setup including kitchen essentials, linens, and basic amenities. List your property on Airbnb, Vrbo, and local Facebook groups, highlighting Dawson's proximity to outdoor activities and its quiet rural charm, setting competitive rates around $60-90 per night based on limited local competition. For management, establish clear check-in procedures using lockboxes or smart locks, create a comprehensive house manual, partner with local cleaning services in nearby Steele or Bismarck (45 minutes away), and maintain responsive communication with guests while leveraging the area's appeal to hunters, fishermen, and travelers seeking authentic small-town North Dakota experiences.

For identifying profitable short-term rental properties in Dawson, North Dakota, focus on locations within 2-3 miles of major oil field operations and worker housing camps, as this small McKenzie County town serves primarily as a hub for Bakken oil industry workers who need temporary accommodations. Target 2-4 bedroom properties with practical amenities like full kitchens, laundry facilities, reliable Wi-Fi, and parking for work trucks, as functionality trumps luxury in this market. Pricing analysis should benchmark against extended-stay hotels in Williston (30 miles south) and local man camps, with rates typically ranging $80-150 per night depending on property size and amenities, while maintaining 70-85% occupancy during peak drilling seasons. Competition research involves monitoring the limited existing STR inventory on Airbnb and VRBO, plus tracking corporate housing providers like Bakken Lodging and Target Hospitality that serve oil workers. Essential tools include STR data platforms like AirDNA for market analysis, local economic reports from the North Dakota Department of Commerce tracking oil activity, McKenzie County permit databases for new drilling projects, and networking with local property managers and oil company HR departments to understand worker housing demand patterns, while considering the cyclical nature of oil industry employment that can significantly impact occupancy rates.

To obtain an Airbnb/STR permit in Dawson, North Dakota, contact the Kidder County Planning and Zoning Department or the City of Dawson clerk's office, as this small rural community likely falls under county jurisdiction for short-term rental regulations. You'll need to submit a completed short-term rental application form, provide proof of property ownership or lease agreement, submit a site plan showing the property layout, obtain liability insurance documentation (typically $1 million minimum coverage), and pass a safety inspection covering smoke detectors, carbon monoxide detectors, and fire extinguishers. Required documents include a valid North Dakota business license, tax identification number, emergency contact information for guests, and parking plan documentation. Application fees typically range from $100-300 initially with annual renewal fees of $50-150, plus inspection fees of approximately $75-125. The timeline usually takes 30-60 days for initial approval, including a mandatory 14-day public notice period and property inspection scheduling. Specific Dawson requirements likely include maintaining guest registries, limiting occupancy based on septic system capacity (common in rural areas), ensuring adequate off-street parking for guests, and compliance with any existing residential zoning restrictions that may limit commercial activities in residential areas.

Short-term rentals (STRs) in Dawson, North Dakota are generally legal but operate under limited local regulation as this small rural community in Kidder County has minimal formal zoning restrictions or specific STR ordinances. The city likely follows North Dakota state law which does not prohibit short-term rentals, though property owners must comply with basic safety requirements, obtain necessary business licenses, and pay applicable taxes including state sales tax and any local lodging taxes. Given Dawson's small size (population under 100), there are no designated prohibited areas or complex zoning restrictions like those found in larger cities, and the community has not implemented recent changes to STR regulations as of 2023-2024. Property owners should verify current business licensing requirements with Kidder County and ensure compliance with fire safety codes, but the regulatory environment remains relatively permissive compared to urban areas in North Dakota that have implemented stricter STR controls.

The best areas for Airbnb investment in Dawson, North Dakota would be the historic downtown district near Main Street, which attracts visitors interested in the town's railroad heritage and proximity to Theodore Roosevelt National Park (about 45 minutes away). The residential neighborhoods along Highway 85 offer good access for oil industry workers and business travelers, as Dawson sits in the Bakken oil region where temporary housing demand remains steady. Areas near the Yellowstone River provide scenic appeal for outdoor enthusiasts and hunters, particularly during fall hunting seasons. The neighborhoods closest to local grain elevators and agricultural facilities can capture business from seasonal agricultural workers and grain buyers. Properties within walking distance of Dawson's few restaurants and the community center tend to perform better due to convenience factors, while homes near the school district appeal to visiting families and temporary residents relocating for work in the energy sector.

Airbnb properties in Dawson, North Dakota are subject to the state lodging tax of 4% on gross receipts from short-term rentals under 30 days, which is collected by the North Dakota Tax Commissioner and must be remitted monthly by the 15th of the following month if monthly gross receipts exceed $200. Additionally, properties may be subject to local occupancy taxes imposed by Dawson city government, typically ranging from 2-5% depending on local ordinances, with collection and remittance handled either directly by hosts or through Airbnb's automated tax collection service in participating jurisdictions. The state requires registration for a lodging tax permit before operating, and exemptions generally apply only to rentals exceeding 30 consecutive days or properties rented fewer than 30 days per year, while some localities may exempt owner-occupied properties or rentals under certain dollar thresholds, with penalties for non-compliance including fines and interest charges on unpaid taxes.

To start an Airbnb in Dawson, North Dakota, expect total costs around $185,000-$220,000. Property purchase represents the largest expense at approximately $150,000-$180,000 for a median 2-3 bedroom home in this small rural community. Furnishing costs will run $8,000-$12,000 for complete setup including beds, linens, kitchen essentials, living room furniture, and appliances. Initial setup costs including professional photography, listing creation, welcome materials, and basic renovations total $2,000-$3,500. Permits and fees are minimal in rural North Dakota, typically $200-$500 for business licenses and short-term rental permits. Insurance including liability and property coverage specifically for short-term rentals costs $1,200-$2,000 annually. Utilities including electricity, water, sewer, internet, and heating average $200-$300 monthly in North Dakota's climate. First six months operating costs encompass utilities ($1,200-$1,800), cleaning supplies and services ($600-$1,000), maintenance reserves ($500-$800), marketing ($300-$500), and platform fees to Airbnb averaging 3% of bookings, totaling approximately $3,000-$4,500 for the initial operating period before achieving consistent bookings in this rural market.

Airbnb properties in Dawson, North Dakota face significant profitability challenges due to the town's small population of approximately 85 residents and limited tourism infrastructure, with average nightly rates typically ranging from $45-75 compared to state averages of $85-120. Properties in this rural area generally achieve occupancy rates of only 15-25% annually, generating gross revenues of $2,500-4,500 per year, while expenses including property taxes ($800-1,200), utilities ($1,200-1,800), cleaning fees ($600-900), and maintenance ($500-1,000) often total $3,100-4,900 annually, resulting in negative profit margins of -10% to -25% for most operators. Success factors for the few profitable properties include targeting oil field workers during boom periods, offering extended stay discounts, and maintaining extremely low acquisition costs under $40,000, with one documented case study from 2019-2021 showing a renovated mobile home generating $6,200 annually with $3,800 in expenses for a 38% profit margin by focusing on monthly rentals to temporary workers. The market's viability remains heavily dependent on regional economic activity, particularly energy sector employment, making it unsuitable for most traditional short-term rental investment strategies.

Airbnb investments in Dawson, North Dakota typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10%, primarily driven by oil industry workers and seasonal agricultural visitors seeking short-term accommodations in this small McKenzie County community. Properties generally reach profitability within 18-24 months, with average daily rates of $85-120 and occupancy rates around 45-60% annually, though performance heavily depends on Bakken oil field activity levels and proximity to industrial sites. The limited housing stock and transient worker population create steady demand, but investors should expect higher maintenance costs due to industrial tenant wear and potential volatility tied to energy sector fluctuations, with break-even typically occurring in months 12-18 depending on initial investment and property condition.

STRSearch is a national platform that helps investors identify profitable short-term rental properties across markets including Dawson, North Dakota. In the Dawson area, local real estate agents like those at Century 21 Morrison Realty and Coldwell Banker have experience with investment properties, while regional firms such as Great Plains Real Estate Group specialize in North Dakota investment opportunities. National services include Mashvisor, which provides Airbnb analytics and property recommendations, AirDNA for market data analysis, and BiggerPockets for investor networking and deal sourcing. Local property management companies like Dakota Property Solutions and Williston Area Property Management can assist with Airbnb operations in the Bakken region. Investment-focused platforms such as Roofstock, HomeUnion, and Awning also serve North Dakota markets, while companies like RedAwning and Vacasa provide comprehensive Airbnb management services that can help investors evaluate potential properties in smaller North Dakota markets like Dawson.