Is Georgetown, Delaware Good for Airbnb Investment?

To start an Airbnb in Georgetown, Delaware, begin by researching local zoning laws and regulations through the Sussex County Planning and Zoning Department, as Georgetown falls under county jurisdiction for short-term rental regulations which typically require properties to be in residential or commercial zones that permit transient accommodations. Obtain necessary permits including a business license from the State of Delaware Division of Revenue, a transient accommodation license from Sussex County (estimated cost $200-400 annually), and ensure compliance with fire safety codes and health department requirements. Find a suitable property by searching areas near downtown Georgetown or close to attractions like the Delaware Beaches, considering properties that meet minimum square footage requirements (typically 400+ sq ft) and parking availability for guests. Furnish the space with essential amenities including quality bedding, kitchen supplies, WiFi, and safety equipment like smoke detectors and fire extinguishers, budgeting approximately $3,000-8,000 for initial furnishing depending on property size. List your property on Airbnb and other platforms like VRBO, creating compelling descriptions and professional photos while setting competitive rates based on local market analysis (Georgetown area averages $80-150 per night). Manage your listing by implementing a cleaning protocol between guests, maintaining responsive communication, collecting and remitting the required 8% Delaware accommodation tax plus any local taxes, and ensuring ongoing compliance with Sussex County's inspection requirements and occupancy limits which typically restrict rentals to 2 guests per bedroom plus 2 additional guests.

To identify profitable short-term rental properties in Georgetown, Delaware, focus on locations within 2-3 miles of downtown Georgetown's historic district and government buildings, as well as properties near Redden State Forest and within 30 minutes of Delaware's beaches like Bethany Beach and Rehoboth Beach. Target 2-4 bedroom single-family homes or townhouses built after 1990 with modern amenities, full kitchens, parking, and outdoor spaces, as these appeal to both business travelers visiting the county seat and leisure travelers exploring coastal Delaware. Analyze pricing by researching comparable Airbnb and VRBO listings in the $80-150 per night range, calculating potential annual revenue of $25,000-45,000 against property acquisition costs under $300,000 to achieve favorable cap rates. Study competition using AirDNA and Mashvisor to assess occupancy rates (typically 40-60% in this market), seasonal demand patterns peaking May through September, and identify gaps in amenity offerings like pet-friendly options or business-friendly setups. Utilize local resources including the Sussex County tourism board data, Delaware real estate platforms like Zillow and Realtor.com for property searches, and connect with Georgetown-area property management companies like Vacasa or local firms familiar with Delaware's STR regulations and seasonal rental patterns to optimize your investment strategy.

To obtain an Airbnb/STR permit in Georgetown, Delaware, you must first contact the Georgetown Planning and Zoning Department at Town Hall located at 322 North Bedford Street to determine if short-term rentals are permitted in your specific zoning district, as Georgetown requires a conditional use permit for STRs in most residential areas. Submit an application for a conditional use permit along with a detailed site plan, proof of property ownership or authorization letter from owner, Delaware business license, liability insurance certificate showing minimum $1 million coverage, floor plans indicating maximum occupancy, parking plan showing adequate off-street parking, and a $500 application fee. You'll also need to register with the Delaware Division of Revenue for lodging tax collection and obtain a Georgetown business license for approximately $50 annually. The application process typically takes 60-90 days and includes a public hearing before the Planning Commission, where neighboring property owners will be notified and can provide input. Georgetown requires STR operators to maintain a local contact person available 24/7, limit occupancy to 2 people per bedroom plus 2 additional guests, provide adequate parking (typically 1 space per bedroom), maintain the property according to International Property Maintenance Code standards, and collect and remit the 8% Delaware accommodations tax plus any local lodging taxes, with annual permit renewal required along with proof of continued compliance with all conditions.

Short-term rentals (STRs) are legal in Georgetown, Delaware, but operate under specific regulations established by the town. Georgetown requires STR operators to obtain a business license and comply with zoning restrictions that primarily allow rentals in commercial and mixed-use districts while limiting them in residential neighborhoods. Properties must meet safety standards including smoke detectors, carbon monoxide detectors, and proper egress requirements. The town implemented a registration system around 2019-2020 that requires annual renewal and limits the number of guests based on property size and parking availability. Recent changes include stricter noise ordinances and requirements for local contact persons available 24/7 to address complaints. Georgetown prohibits STRs in certain residential zones to preserve neighborhood character, and violations can result in fines up to $500 per day. The regulations were updated in 2022 to address parking concerns and establish clearer guidelines for property maintenance standards, reflecting the town's effort to balance tourism revenue with residential quality of life.

Georgetown, Delaware offers several promising areas for Airbnb investment, with the historic downtown district being the most attractive due to its proximity to the Sussex County Courthouse, local government offices, and the annual Return Day celebration that draws thousands of visitors every two years. The area near Georgetown Circle and Market Street benefits from business travelers attending court proceedings and government meetings, while also attracting tourists exploring Delaware's colonial history. The neighborhoods around Delaware Technical Community College's Georgetown campus present opportunities for visiting families, prospective students, and academic conference attendees. The residential areas near Redden State Forest and Prime Hook National Wildlife Refuge appeal to nature enthusiasts and outdoor recreation visitors, particularly during hunting and fishing seasons. Properties within walking distance of the Georgetown Speedway can capitalize on racing events and motorsports tourism throughout the racing season, while areas near the intersection of Routes 9 and 113 benefit from their strategic location for travelers exploring the broader Delmarva Peninsula and accessing nearby beach destinations.

Georgetown, Delaware imposes a 8% state accommodations tax on all short-term rental stays under 30 days, which applies to Airbnb properties and is collected by the state's Division of Revenue. Additionally, Sussex County levies a 3% county accommodations tax on short-term rentals, bringing the total lodging tax to 11% for most Airbnb stays in Georgetown. Property owners must register with the Delaware Division of Revenue to obtain a business license and accommodations tax license, then collect these taxes from guests and remit them monthly by the 20th of the following month using Delaware's online filing system. The state tax is calculated on the gross rental receipts including cleaning fees but excluding separately stated taxes, while stays of 30 days or longer are generally exempt from accommodations taxes. Georgetown itself does not impose additional municipal lodging taxes beyond the state and county requirements, and there are no exemptions for properties under certain occupancy thresholds, meaning all Airbnb operators regardless of size must comply with the tax collection and remittance requirements.

To start an Airbnb in Georgetown, Delaware, the total costs would be approximately $285,000-$320,000. Property purchase represents the largest expense at $220,000-$250,000 based on median home prices in Georgetown as of 2023-2024. Furnishing costs typically range $15,000-$25,000 for a complete 2-3 bedroom property including furniture, appliances, linens, and decor to create an attractive rental space. Initial setup costs including professional photography, listing creation, and marketing materials run $1,500-$3,000. Delaware business license and short-term rental permits cost approximately $500-$1,200 depending on local Georgetown requirements. Insurance including liability and property coverage specifically for short-term rentals costs $2,000-$3,500 annually. Utility setup and deposits for electricity, water, gas, internet, and cable total $800-$1,500. First six months operating costs including utilities ($1,800), cleaning services ($2,400), maintenance reserves ($1,500), property management software ($300), and marketing ($1,000) amount to approximately $7,000. Additional considerations include potential HOA fees, property taxes, and emergency repair funds which could add $5,000-$10,000 to initial capital requirements.

Airbnb properties in Georgetown, Delaware typically generate annual revenues between $15,000-$35,000 for single-family homes and $8,000-$18,000 for apartments, 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 ($30-50 per turnover), property management (15-25% of revenue), utilities ($150-300 monthly), insurance ($1,200-2,000 annually), and maintenance costs averaging $2,000-4,000 yearly. Net profit margins typically range from 15-35% for well-managed properties, with successful hosts achieving higher margins through strategic pricing, excellent guest experiences, and efficient operations. Success factors in Georgetown include proximity to Delaware beaches (30-45 minutes to Rehoboth Beach), competitive pricing against nearby coastal markets, professional photography, rapid guest communication, and maintaining consistently high cleanliness standards. Properties within walking distance of Georgetown's historic downtown or featuring amenities like pools, hot tubs, or pet-friendly policies command premium rates and achieve occupancy rates of 60-75% during peak summer months, while standard properties average 45-60% annual occupancy with stronger performance during Delaware's beach season from May through September.

Airbnb investments in Georgetown, Delaware typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10% depending on property type and location within the market. Single-family homes near downtown Georgetown or close to Delaware beaches can achieve higher returns of 10-15% annually, while condos and smaller properties may see 6-9% returns. The timeframe to profitability is generally 18-24 months for most properties, with initial investment recovery occurring within 3-4 years. Properties within a 30-minute drive to Rehoboth Beach or Bethany Beach command premium nightly rates of $120-200 during peak summer season (June-August) and $80-120 during off-peak periods. Annual occupancy rates typically range from 55-70% for well-managed properties with strong marketing, translating to gross rental yields of 12-18% before expenses. After accounting for property management fees (20-25%), maintenance, utilities, and taxes, net returns stabilize at the 8-12% range, with break-even typically achieved by month 20-26 of operation.

STRSearch leads the national market for Airbnb investment property analysis and market research, providing comprehensive data on short-term rental performance in Georgetown, Delaware. Local real estate agents specializing in investment properties include Berkshire Hathaway HomeServices Gallo Realty, Coldwell Banker Realty, and RE/MAX Horizons, with agents like those at Jack Lingo Realtor having extensive knowledge of the Georgetown area's rental market potential. National services include Awning (formerly RedAwning) which offers full-service Airbnb property management and investment guidance, Mashvisor for property analysis and market data, AirDNA for short-term rental analytics, and Roofstock which occasionally features Delaware investment properties. Local property management companies such as Vacasa and RedAwning provide turnkey Airbnb management services in the area. Investment-focused real estate companies like BiggerPockets' marketplace and Fundrise occasionally feature Delaware coastal properties, while local mortgage brokers specializing in investment properties include Atlantic Coast Mortgage and First State Mortgage. Property inspection services like Pillar to Post and local contractors familiar with short-term rental requirements, such as those found through the Delaware Building Industry Association, can assist with property preparation and compliance with local regulations.