Is Ellettsville, Indiana Good for Airbnb Investment?

Potentially—Ellettsville, Indiana combines visitor demand with long-term real estate upside.

• Presents a potentially favorable opportunity, largely influenced by its proximity to Bloomington and Indiana University.
• Current market conditions in Ellettsville benefit from overflow tourism from Bloomington, especially during university events, sporting events, and the academic year.
• Property values in Ellettsville are generally more accessible than in larger nearby cities, offering a lower entry point for investors while still showing steady appreciation due to regional growth.
• While Ellettsville itself is a smaller community, its role as a quiet, convenient alternative to the busier urban centers enhances its appeal for visitors seeking a more relaxed stay.
• This blend of lower acquisition costs, consistent demand from a major university, and a growing regional economy contributes to a positive investment potential for Airbnb operators.

$800–$2,200, based on location, season, and property quality.

• Based on available market data and regional analysis, Airbnb properties in Ellettsville, Indiana typically generate monthly revenues ranging from $800 to $2,200, with most hosts earning between $1,200 to $1,600 per month depending on property size and amenities.
• Seasonal variations show peak earnings during late spring through early fall when Indiana University is in session and local events drive demand.
• Properties closer to Indiana University campus or featuring unique amenities like hot tubs or pet-friendly policies tend to command premium rates of $80-120 per night.
• Key factors affecting earnings include proximity to IU campus, property condition and cleanliness ratings, responsive host communication, competitive pricing strategies.
• The relatively small market size means that well-managed properties with strong reviews can achieve occupancy rates of 60-75% annually.

Potentially strong—typical annual ROI is 8–12%.

• Typically generate ROI between 8-12% annually, with payback periods averaging 7-9 years due to the town's proximity to Indiana University and seasonal demand fluctuations.
• Properties near campus or downtown areas command nightly rates of $80-120, with occupancy rates around 65-70% annually.
• Compared to traditional long-term rentals yielding 6-8% ROI in Ellettsville, short-term rentals can provide 2-4 percentage points higher returns but require significantly more active management and face seasonal vacancy challenges during summer months when student demand drops.
• The market benefits from limited hotel inventory and growing tourism to nearby Brown County, though investors must account for higher operating costs including frequent cleaning, utilities.

Ellettsville, Indiana averages 45–55% annual occupancy, with seasonal variation.

• Airbnb occupancy rates in Ellettsville, Indiana typically average around 45-55% annually, with significant seasonal variations driven by Indiana University's academic calendar and local tourism patterns.
• Peak occupancy occurs during fall months (September-November) at approximately 70-80% due to IU football season and autumn activities.
• Summer months experience moderate occupancy of 50-60% from family visits and local festivals, while winter months drop to 30-40% during academic breaks.
• Ellettsville's occupancy rates generally align with or slightly exceed Indiana's statewide average of 50-55% due to its proximity to Bloomington and Indiana University.

The strongest opportunities balance visitor demand, nightly rates, and acquisition cost.

• The downtown Ellettsville area near Main Street offers the best Airbnb investment potential due to its walkable historic charm, proximity to local restaurants and shops.
• The neighborhoods surrounding Ellettsville Elementary School provide family-friendly appeal with quiet residential streets, moderate property prices.
• Areas near the Clear Creek Trail system attract outdoor enthusiasts and offer unique selling points for nature-focused listings while maintaining reasonable acquisition costs.
• The residential zones along County Road 140 benefit from larger lot sizes and privacy while still being convenient to Bloomington.
• Neighborhoods near the Ellettsville Town Park combine recreational amenities with established infrastructure, drawing families and groups for longer stays.
• The areas around State Road 46 corridor provide excellent visibility and accessibility for business travelers and university visitors, though traffic noise may limit premium pricing.
• Finally, the newer residential developments on the town's eastern edge offer modern amenities and appeal to guests preferring updated accommodations.

Yes, but only where zoning permits short-term rentals and every required license is current.

• Short-term rental regulations in Ellettsville, Indiana are primarily governed by local zoning ordinances and state regulations.
• Properties must adhere to occupancy limits based on bedroom count (generally 2 persons per bedroom plus 2 additional), and while owner-occupancy is not strictly required.
• The registration process involves submitting an application to the town clerk's office with property details, insurance documentation, and a fee of approximately $50-100 annually.
• Zoning restrictions generally prohibit short-term rentals in multi-family districts and require properties to maintain residential character without commercial signage.
• Property owners must also collect and remit Indiana state sales tax and local innkeeper's tax, maintain guest registries.

Tax rates vary by jurisdiction; licensing, inspection, and insurance costs are additional.

• Short-term rentals in Ellettsville, Indiana are subject to Indiana's state innkeeper's tax of 7% on gross rental receipts.
• Monroe County, where Ellettsville is located, may impose an additional local innkeeper's tax of up to 8%.
• Property owners must register their short-term rental business with the Indiana Department of Revenue and obtain a registered retail merchant certificate, which costs approximately $25.
• Annual business registration fees with the town of Ellettsville are estimated at $50-75, and operators may need to obtain a home occupation permit costing around $25-50 annually.
• Food and beverage tax of 1% applies if meals are provided with the rental.
• Property owners must also remit standard property taxes, and depending on the rental's gross income, may need to pay Indiana's business personal property tax on furnishings and equipment.