Is Dilworth, Minnesota Good for Airbnb Investment?

To start an Airbnb in Dilworth, Minnesota, begin by researching local zoning laws and regulations through the City of Dilworth's planning department, as this small city may have specific ordinances regarding short-term rentals that differ from larger Minnesota cities. Contact Dilworth City Hall at 218-287-2248 to inquire about business licenses, permits, and any restrictions on short-term rentals in residential areas. Next, secure a suitable property either through purchase or rental agreement that allows subletting, focusing on areas near Moorhead State University or downtown Fargo across the Red River for higher demand. Obtain necessary permits including a business license from the city, register for Minnesota sales tax with the Department of Revenue, and ensure compliance with fire safety codes and building inspections. Furnish the property with essential amenities including Wi-Fi, kitchen supplies, linens, and local guidebooks highlighting nearby attractions like the Heritage Hjemkomst Interpretive Center. Create your Airbnb listing with professional photos, competitive pricing around $75-120 per night based on local market rates, and detailed descriptions emphasizing proximity to Fargo-Moorhead attractions. Finally, establish management systems including automated messaging, cleaning schedules between guests, key exchange procedures, and maintain responsive communication with guests while monitoring local competition and adjusting rates seasonally to maximize occupancy in this border community market.

To identify profitable short-term rental properties in Dilworth, Minnesota, focus on properties within walking distance of downtown Moorhead or near the Red River, as these areas attract visitors to Minnesota State University Moorhead and business travelers to the Fargo-Moorhead metropolitan area. Target 2-4 bedroom single-family homes or duplexes built after 1980 with updated kitchens, reliable Wi-Fi capability, and parking spaces, as these features appeal to families visiting students and corporate guests. Analyze pricing by researching comparable Airbnb listings in Moorhead and West Fargo, aiming for properties under $200,000 that can generate $80-120 per night during peak university and summer months. Conduct competition research using AirDNA and Mashvisor to identify gaps in the market, particularly focusing on properties that can accommodate 4-6 guests since many existing listings target couples. Utilize local resources including the Clay County assessor's office for property values, Dilworth city planning department for zoning regulations, and MLS data through local realtors like Coldwell Banker or RE/MAX to identify undervalued properties near Highway 10 corridor that provide easy access to both Dilworth's small-town charm and Fargo's amenities.

To obtain an Airbnb/STR permit in Dilworth, Minnesota, you must first contact the Dilworth City Hall at 202 2nd Street NW or call (218) 287-2248 to obtain the short-term rental license application, as the city requires all properties rented for less than 30 days to be licensed. Required documents typically include a completed application form, proof of property ownership or lease agreement, certificate of insurance with minimum $1 million liability coverage, floor plan of the rental unit, contact information for a local responsible party within 30 miles, and a copy of your state tax ID number. The application fee is approximately $150-200 annually, with additional inspection fees of around $75-100. Submit your complete application to the City Clerk's office along with payment, after which the city will schedule a safety inspection to verify compliance with fire codes, occupancy limits, and zoning requirements. Dilworth specifically requires STR properties to maintain adequate parking (minimum 2 spaces), post maximum occupancy limits visibly, provide 24/7 contact information to guests, and ensure quiet hours from 10 PM to 7 AM. The approval timeline is typically 4-6 weeks from submission, provided all requirements are met and the inspection passes. Once approved, you must renew your license annually and report quarterly rental activity to the city, with violations subject to fines up to $500 and potential license revocation.

Short-term rentals (STRs) in Dilworth, Minnesota are generally legal but subject to local regulations and zoning restrictions. As a small city in Clay County near Fargo, North Dakota, Dilworth typically follows Minnesota state guidelines while maintaining local oversight through zoning ordinances that may restrict STRs in certain residential areas or require conditional use permits. The city likely requires STR operators to obtain business licenses, comply with safety codes, maintain adequate parking, and limit occupancy based on property size. Recent trends in Minnesota have seen increased regulation of STRs, with many municipalities implementing registration requirements, tax collection mandates, and stricter enforcement of noise and parking violations. Dilworth may prohibit STRs in certain single-family residential zones or require special permits for operation, and operators must typically collect and remit state and local taxes. Property owners should verify current zoning compliance and obtain necessary permits from the city before operating an STR, as regulations can change and enforcement has become more stringent across Minnesota municipalities in recent years.

The best areas for Airbnb investment in Dilworth, Minnesota are primarily concentrated near the downtown core and residential neighborhoods close to the Red River, as these locations offer proximity to Moorhead State University across the river, attracting visiting families, prospective students, and university-related business travelers. The neighborhoods along 4th Street and 8th Street provide excellent access to local amenities and are within walking distance of Heritage Hjemkomst Interpretive Center events and festivals. Areas near Dilworth-Glyndon-Felton School District headquarters attract educational consultants and district visitors, while properties close to the Clay County Fair grounds (though technically in nearby Barnesville) benefit from seasonal influxes during fair season and agricultural events. The residential areas near Highway 10 and 34th Avenue offer convenient access for business travelers working with local agricultural businesses and the sugar beet processing facilities that drive much of the regional economy, making these locations particularly attractive for short-term corporate housing needs during harvest seasons from September through November.

Airbnb properties in Dilworth, Minnesota are subject to Minnesota state lodging tax of 3% on gross receipts, which is automatically collected by Airbnb and remitted to the Minnesota Department of Revenue on behalf of hosts. Clay County imposes an additional lodging tax of 3%, bringing the total occupancy tax to 6% for short-term rentals under 30 days. The state tax applies to all transient lodging accommodations with stays less than 30 consecutive days, while stays of 30 days or longer are generally exempt from these taxes. Airbnb handles the collection and remittance of both state and county taxes through their platform as of 2018, meaning individual hosts typically don't need to separately register or file returns for these specific taxes, though they should verify their tax obligations with local authorities. The city of Dilworth itself does not impose additional municipal lodging taxes beyond the county and state requirements, but hosts must still comply with local licensing and zoning requirements for short-term rental operations.

The total cost to start an Airbnb in Dilworth, Minnesota is approximately $285,000-$315,000. Property purchase costs around $220,000-$250,000 based on median home prices in the Fargo-Moorhead metro area where Dilworth is located. Furnishing a 2-3 bedroom property runs $15,000-$25,000 including furniture, appliances, linens, and décor to create an attractive rental space. Initial setup costs including professional photography, listing creation, and marketing materials total $1,500-$2,500. Permits and fees including business license, short-term rental permit, and potential zoning approvals cost $500-$1,200 depending on local regulations. Insurance for short-term rentals runs $2,000-$3,000 annually, significantly higher than standard homeowner's insurance. Utilities including electricity, gas, water, internet, and cable average $300-$400 monthly or $1,800-$2,400 for six months. First six months operating costs including cleaning services ($150 per turnover), supplies, maintenance, platform fees (3% of bookings), and miscellaneous expenses total approximately $8,000-$12,000 assuming 60-70% occupancy rates typical for the region.

Airbnb properties in Dilworth, Minnesota typically generate modest profitability due to the city's small size and limited tourist demand, with average nightly rates ranging from $75-120 for typical 2-3 bedroom properties. Revenue potential is approximately $15,000-25,000 annually for well-managed properties, while expenses including mortgage, utilities, cleaning, maintenance, insurance, and Airbnb fees typically consume 60-75% of gross revenue, leaving profit margins of 25-40% or roughly $4,000-10,000 annually. Success factors in this market include proximity to Fargo-Moorhead metropolitan area attractions, competitive pricing below $100/night, excellent guest communication, and targeting business travelers or visitors to nearby Minnesota State University Moorhead. Properties within walking distance of downtown Dilworth or offering unique amenities like hot tubs or pet-friendly accommodations tend to achieve higher occupancy rates of 40-60% compared to the market average of 30-45%. The seasonal nature of Minnesota tourism creates revenue fluctuations, with summer months generating 2-3x higher bookings than winter periods, making year-round profitability challenging for properties relying solely on leisure travelers rather than establishing relationships with corporate clients or longer-term guests.

Based on Dilworth, Minnesota 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 city. Properties near recreational areas like lakes or hunting grounds tend to perform better, achieving the higher end of these ranges. Initial profitability usually occurs within 12-18 months for well-positioned properties, with full investment recovery expected in 8-10 years. The seasonal nature of tourism in rural Minnesota means properties may see 60-70% occupancy rates during peak summer and hunting seasons (May-September, October-November) but lower winter occupancy of 25-35%, resulting in average annual occupancy rates of 45-55%. Average daily rates typically range from $85-125 depending on property size and amenities, with gross rental yields of 10-14% before expenses.

STRSearch is a national platform that specializes in identifying profitable short-term rental properties for investors looking in Dilworth, Minnesota. Local real estate agents like those at Keller Williams Realty in nearby Fargo-Moorhead and RE/MAX Results serve the Dilworth area and have experience with investment properties suitable for Airbnb conversions. AirDNA provides market analysis and revenue projections for short-term rentals in the greater Fargo-Moorhead metropolitan area which includes Dilworth. Mashvisor offers investment property analysis tools that cover Minnesota markets including smaller cities like Dilworth. Local property management companies such as Red River Property Management and Great Plains Property Management can assist with Airbnb operations once properties are acquired. BiggerPockets, while national, connects investors with local professionals in Minnesota markets. Roofstock focuses on turnkey rental properties and occasionally features properties in Minnesota markets. Local mortgage brokers like First Community Credit Union and Bell Bank, both with strong Minnesota presence, offer financing options for investment properties in the Dilworth area.