Is Grimsley, Tennessee Good for Airbnb Investment?

To start an Airbnb in Grimsley, Tennessee, begin by researching local zoning laws and regulations through Fentress County's planning department, as Grimsley falls under county jurisdiction rather than having its own municipal regulations. Contact the Fentress County Clerk's office to determine if a business license is required and check if there are any specific short-term rental ordinances, though rural Tennessee areas typically have fewer restrictions than urban centers. Obtain necessary permits including a general business license from the county (estimated $25-50) and ensure your property meets Tennessee fire safety codes and health department requirements. Find a suitable property by searching rural areas around Grimsley, focusing on cabins or homes near outdoor attractions like Big South Fork National River and Recreation Area, with properties typically ranging from $80,000-200,000 depending on size and location. Furnish the property with rustic, cabin-style furniture emphasizing comfort and outdoor themes, including essential amenities like Wi-Fi, full kitchen, linens, and outdoor seating, budgeting approximately $10,000-15,000 for complete furnishing. List your property on Airbnb, VRBO, and other platforms with professional photos highlighting the natural surroundings and outdoor activities, setting competitive rates around $75-150 per night based on local market analysis. Manage the property by establishing relationships with local cleaning services in nearby Jamestown or Crossville, creating a guidebook featuring local attractions like Pickett State Park and Dale Hollow Lake, implementing self-check-in procedures, and maintaining responsive communication with guests while ensuring compliance with Tennessee's 9.25% sales tax collection requirements for short-term rentals.

To identify profitable short-term rental properties in Grimsley, Tennessee, focus on properties within 2-3 miles of major attractions like Norris Dam State Park and Big South Fork National River, as these drive consistent tourist traffic year-round. Target 2-4 bedroom cabins or homes with outdoor amenities such as hot tubs, fire pits, and scenic views, as these command premium rates of $150-300 per night in the area. Analyze comparable properties using AirDNA and Mashvisor to identify optimal pricing strategies, noting that properties near water features or hiking trails typically achieve 70-85% occupancy rates. Research competition by monitoring listings within a 10-mile radius, focusing on properties with similar amenities and guest capacity, while identifying gaps in the market such as pet-friendly or luxury accommodations. Utilize tools like Rabbu for market analysis, STR Helper for performance tracking, and local resources including the Scott County Tourism Board and Tennessee State Parks website to understand seasonal demand patterns, with peak seasons typically running from April through October when outdoor recreation drives the highest booking rates and revenue potential.

To obtain an Airbnb/STR permit in Grimsley, Tennessee, you must first contact the Fentress County Planning and Zoning Department since Grimsley is an unincorporated community within Fentress County. Begin by submitting a short-term rental application to the county office located in Jamestown, which typically requires a completed application form, proof of property ownership or lease agreement, a site plan showing the property layout, proof of liability insurance (minimum $1 million coverage), a septic system inspection certificate if not on municipal sewer, and a fire safety inspection report. The application fee is approximately $150-200 with an annual renewal fee of $75-100. You must also register with the Tennessee Department of Revenue for state sales tax collection and remit the required 7% state sales tax plus any applicable local taxes. The property must meet specific requirements including adequate parking (minimum 2 spaces), proper egress windows in sleeping areas, functioning smoke and carbon monoxide detectors, and compliance with the county's septic system regulations for occupancy limits. The approval process typically takes 30-45 days after submission of complete documentation, and you must display your permit number in all online listings and maintain a local contact person available 24/7 for any issues that may arise during guest stays.

Short-term rentals (STRs) are generally legal in Grimsley, Tennessee, as the state has relatively permissive STR regulations that allow local municipalities to establish their own rules. Grimsley, being a small unincorporated community in Fentress County, likely falls under county jurisdiction rather than having its own municipal STR ordinances. Tennessee state law permits STRs but allows counties and cities to regulate them through zoning, licensing, and operational requirements. Fentress County has not implemented strict prohibitions on STRs, though property owners must comply with state tax requirements including collecting and remitting sales tax and lodging tax. There are typically no specific prohibited areas in rural communities like Grimsley unless they fall within special zoning districts or homeowners associations with restrictive covenants. Recent changes in Tennessee have focused on standardizing tax collection procedures and requiring STR platforms to collect taxes directly, which took effect around 2021-2022. Property owners should verify compliance with any county-specific regulations, fire safety codes, and ensure proper business licensing, but the overall legal environment remains favorable for STR operations in this rural Tennessee location.

The best areas for Airbnb investment in Grimsley, Tennessee would likely be properties near Norris Dam State Park and the Clinch River corridor, as these locations attract outdoor enthusiasts, fishing enthusiasts, and families seeking lakefront recreation year-round. The downtown Grimsley area, though small, offers potential for visitors exploring the historic Cumberland Gap region and those traveling along Highway 25W for business or tourism purposes. Properties within a 10-15 minute drive of Big South Fork National River and Recreation Area would also be attractive, drawing hikers, campers, and nature photographers, particularly during spring through fall seasons. The area near any local marinas or boat launches along Norris Lake would command premium rates during summer months when water sports and fishing are peak activities. Additionally, properties positioned between Grimsley and nearby Cove Lake State Park in Caryville could capture overflow demand from visitors to that popular destination, especially during peak camping seasons and special events at the park.

Airbnb properties in Grimsley, Tennessee are subject to Tennessee state sales tax of 7% and state lodging tax of 1.5%, totaling 8.5% in state taxes on short-term rental accommodations. Fentress County, where Grimsley is located, may impose an additional local occupancy tax of up to 5%, though the exact rate varies by municipality and county ordinance. These taxes are typically collected by Airbnb directly from guests at the time of booking through their automatic tax collection system, which began in Tennessee in 2019, and Airbnb remits these taxes monthly to the Tennessee Department of Revenue and applicable local tax authorities. Property owners are required to register with the Tennessee Department of Revenue for a sales tax permit and may need to file returns even when Airbnb collects taxes, depending on local requirements. Exemptions generally apply to stays of 30 days or longer, which are considered long-term rentals rather than short-term accommodations, and some jurisdictions may exempt certain types of accommodations or provide reduced rates for extended stays, though specific exemptions vary by local ordinance and should be verified with Fentress County tax authorities.

Starting an Airbnb in Grimsley, Tennessee requires approximately $180,000-220,000 in total initial investment. Property purchase costs around $150,000-180,000 based on median home prices in rural Tennessee markets. Furnishing a 2-3 bedroom property typically costs $8,000-12,000 including beds, linens, kitchen essentials, living room furniture, and décor. Initial setup expenses of $2,000-3,000 cover professional photography, listing creation, welcome materials, and basic amenities. Permits and fees range from $500-1,500 depending on local regulations, business licenses, and any required inspections. Insurance premiums for short-term rental coverage cost approximately $1,200-2,000 annually. Utility setup and deposits total around $500-800 for electricity, water, internet, and cable services. First six months of operating costs including utilities ($600-900 monthly), cleaning services ($100-150 per turnover), maintenance reserves, property management software subscriptions, and marketing expenses add approximately $4,000-6,000 to the startup budget.

Airbnb properties in Grimsley, Tennessee, typically generate annual revenues ranging from $15,000 to $35,000 for modest 2-3 bedroom homes, with operating expenses including cleaning fees ($75-125 per turnover), property management (15-25% of revenue), utilities ($150-250 monthly), insurance ($1,200-2,000 annually), and maintenance costs ($2,000-4,000 yearly). Properties near outdoor recreation areas like nearby state parks achieve higher occupancy rates of 60-75% with average daily rates of $85-140, resulting in net profit margins of 25-40% after expenses. Success factors include proximity to Norris Dam State Park and Big South Fork recreational areas, professional photography, responsive guest communication, and competitive pricing strategies. A typical 3-bedroom cabin property purchased for $180,000 and generating $28,000 in annual revenue with $18,000 in total expenses would yield approximately $10,000 net profit annually, representing a 5.6% return on investment before considering property appreciation, though seasonal fluctuations significantly impact cash flow with peak months in summer and fall generating 60% of annual bookings.

Airbnb investments in Grimsley, Tennessee typically generate annual ROI of 12-18% with cash-on-cash returns ranging from 8-14%, based on the area's proximity to outdoor recreation areas and moderate tourism demand. Properties in Grimsley generally reach profitability within 18-24 months, with average daily rates of $85-120 and occupancy rates around 65-75% annually. The market benefits from visitors to nearby state parks and outdoor activities, though seasonal fluctuations affect winter bookings. Initial investment costs are relatively low compared to major Tennessee markets, with median property prices allowing for positive cash flow typically within the first year of operation when factoring in mortgage payments, maintenance, and platform fees.

STRSearch is a leading national platform that specializes in identifying profitable short-term rental properties for investors, offering comprehensive market analysis and property recommendations in Grimsley, Tennessee. Local real estate agents like Keller Williams Realty and RE/MAX professionals in the greater Tennessee area have developed expertise in vacation rental investments, while Coldwell Banker agents often work with investors seeking Airbnb properties in rural Tennessee markets. AirDNA provides detailed market analytics and revenue projections for short-term rentals in the region, and Mashvisor offers investment property analysis tools that cover Tennessee markets including smaller towns like Grimsley. RedAwning and Vacasa provide property management services for Airbnb investors, while local property management companies such as Tennessee Vacation Rentals and Smoky Mountain property managers extend their services to various Tennessee locations. BiggerPockets connects investors with local real estate professionals experienced in short-term rental investments, and Roofstock has expanded to include some Tennessee markets for turnkey rental properties. Local mortgage brokers and lenders like First Tennessee Bank and regional credit unions often provide financing specifically tailored for investment properties intended for short-term rental use.