Is Highland Park, Texas Good for Airbnb Investment?

To start an Airbnb in Highland Park, Texas, begin by researching local regulations as Highland Park has specific zoning restrictions that typically prohibit short-term rentals in residential areas, so you'll need to verify current ordinances with the Highland Park Planning and Zoning Department and potentially seek a special use permit or variance. Contact the Highland Park Building Department to obtain necessary permits including a business license, occupancy permit, and ensure compliance with fire safety codes and building standards. Find a suitable property by purchasing or leasing in areas where short-term rentals are permitted, focusing on properties near SMU or Mockingbird Lane commercial areas, with typical property costs ranging $800,000-$2,000,000 for purchase or $3,000-$8,000 monthly for rental. Furnish the property with high-quality furniture, linens, and amenities targeting the upscale Highland Park demographic, budgeting approximately $15,000-$30,000 for complete furnishing including kitchen essentials, comfortable bedding, and local artwork. List your property on Airbnb and VRBO platforms with professional photography highlighting proximity to downtown Dallas, SMU, and upscale shopping at Highland Park Village, setting competitive rates around $150-$400 per night based on property size and amenities. Manage the property by establishing cleaning protocols between guests, responding promptly to inquiries, coordinating key exchanges, maintaining the property regularly, and considering hiring a local property management company like RedAwning or Vacasa if you're not local, while ensuring compliance with Texas state tax requirements including collecting and remitting hotel occupancy taxes to both the state and potentially Dallas County.

To identify profitable short-term rental properties in Highland Park, Texas, focus on locations within walking distance of SMU campus, near the Highland Park Village shopping district, and close to downtown Dallas for business travelers. Target 2-4 bedroom single-family homes or upscale condos built after 1990 with modern amenities, parking, and outdoor spaces, as Highland Park attracts affluent visitors expecting luxury accommodations. Conduct pricing analysis using AirDNA and STR data platforms to identify properties that can command $150-400+ per night, comparing against local hotel rates at properties like Hotel ZaZa and Rosewood Mansion. Research competition by analyzing existing Airbnb and VRBO listings within a 2-mile radius, noting occupancy rates, pricing strategies, and guest reviews to identify market gaps. Utilize tools like Mashvisor, BiggerPockets calculators, and local MLS data through Dallas-area realtors familiar with Highland Park's $500K-2M+ property values, while consulting with Highland Park's municipal regulations regarding short-term rentals and HOA restrictions that may limit STR operations in this exclusive Dallas suburb.

To obtain an Airbnb/STR permit in Highland Park, Texas, you must first contact the Highland Park Planning and Zoning Department at City Hall located at 4700 Drexel Drive to determine current regulations, as the city has historically restricted short-term rentals in residential areas. You'll need to submit an application including property ownership documentation, a detailed floor plan, proof of liability insurance (typically $1 million minimum), a parking plan showing adequate off-street parking, and contact information for a local property manager if you're not residing on-site. Required documents also include a Highland Park business license application, fire safety inspection certificate, and written consent from any homeowners association if applicable. The application fee is estimated at $200-500 with annual renewal fees of approximately $150-300, though these may vary. The approval process typically takes 30-60 days and includes a public hearing component since Highland Park maintains strict zoning controls. Specific Highland Park requirements include adherence to the city's noise ordinances, occupancy limits based on bedroom count plus two additional guests, mandatory registration of all guests, and compliance with the city's architectural and landscaping standards. Properties must maintain residential character and cannot display commercial signage, with violations subject to fines up to $2,000 per day.

Short-term rentals (STRs) are currently prohibited in Highland Park, Texas, as the city has maintained a complete ban on STR operations within its residential areas since around 2016-2017. Highland Park, an affluent enclave surrounded by Dallas, enacted strict regulations that effectively prohibit the use of residential properties for short-term rental purposes, including platforms like Airbnb and VRBO, citing concerns about neighborhood character, parking, noise, and maintaining the residential nature of the community. The city's zoning ordinances and municipal code specifically restrict transient lodging in residential zones, and there are no permitted areas within Highland Park where STRs can legally operate. Unlike some neighboring Dallas communities that have adopted regulatory frameworks allowing STRs with restrictions, Highland Park has maintained its prohibition without recent changes to liberalize these rules, reflecting the community's preference to preserve its exclusive residential character and prevent commercial lodging activities in residential neighborhoods.

The most promising Airbnb investment areas in Highland Park, Texas include the Park Cities Central district near SMU Boulevard and Mockingbird Lane, which attracts business travelers visiting nearby corporate headquarters like those in the Park Cities and university visitors to Southern Methodist University. The Highland Park Village area offers luxury appeal for affluent travelers seeking upscale accommodations near high-end shopping and dining, particularly during events at the nearby Dallas Country Club established in 1896. The Turtle Creek corridor provides excellent access to downtown Dallas business district while maintaining the prestigious Highland Park address, making it ideal for corporate executives and medical professionals visiting UT Southwestern and Presbyterian Hospital. Areas near Armstrong Elementary and Highland Park High School see consistent demand from prospective residents house-hunting and families visiting students, while properties within walking distance of Highland Park Village's luxury retail district benefit from shopping tourism and special events throughout the year, with the area's proximity to Love Field Airport (approximately 15 minutes) adding convenience for business travelers.

Highland Park, Texas imposes a 7% hotel occupancy tax on short-term rental properties including Airbnbs, which applies to stays of less than 30 consecutive days. This tax is collected by the host at the time of booking or payment and must be remitted to the City of Highland Park on a monthly basis by the 20th of the following month using the city's occupancy tax return form. Additionally, hosts must collect the state of Texas hotel occupancy tax of 6% and any applicable Dallas County hotel tax of 2%, bringing the total occupancy tax burden to approximately 15%. Properties rented for 30 days or longer are exempt from these occupancy taxes, as are rentals to permanent residents or those qualifying under specific exemptions for government employees or certain medical patients. Hosts are required to register with the city, obtain a certificate of occupancy tax registration, and maintain detailed records of all rental transactions for at least four years, with penalties and interest applied to late payments at rates typically ranging from 5-10% per month.

Starting an Airbnb in Highland Park, Texas requires significant upfront investment due to the area's premium real estate market. Property purchase costs average $1.2-1.8 million for a median home in this affluent Dallas suburb, though smaller condos or townhomes may start around $800,000. Furnishing costs typically range $25,000-40,000 for a fully equipped rental including furniture, appliances, linens, and décor to meet guest expectations. Initial setup expenses include professional photography ($500-800), listing creation, and marketing materials totaling approximately $2,000-3,000. Highland Park requires short-term rental permits and business licenses costing roughly $500-1,000 annually, plus potential HOA approval fees. Insurance premiums for short-term rentals run $3,000-5,000 annually, significantly higher than standard homeowner's policies. Monthly utilities including electricity, water, gas, internet, and cable average $300-500 depending on property size and usage. First six months operating costs encompass cleaning services ($100-150 per turnover), maintenance reserves ($500-1,000 monthly), property management if outsourced (20-30% of revenue), and marketing expenses totaling approximately $8,000-15,000. The total initial investment ranges from $850,000-1.9 million depending on property choice, with ongoing monthly expenses of $1,500-3,000 before considering mortgage payments, making Highland Park one of the most expensive markets for Airbnb investment in Texas.

Airbnb properties in Highland Park, Texas demonstrate strong profitability potential with average daily rates ranging from $150-300 for typical 2-3 bedroom homes, generating monthly revenues of $3,000-6,000 based on 60-70% occupancy rates common in this affluent Dallas suburb. Operating expenses typically include 25-30% for Airbnb fees and credit card processing, $200-400 monthly for cleaning services, $150-250 for utilities, $100-200 for supplies and maintenance, plus property taxes averaging $8,000-15,000 annually on homes valued at $400,000-800,000. Net profit margins generally range from 35-50% after expenses, with successful properties achieving $1,500-3,500 monthly profit. Key success factors include proximity to SMU campus, upscale neighborhoods like University Park, professional photography, premium amenities, and responsive guest communication. Properties within walking distance of Highland Park Village shopping center and restaurants command premium rates, with some luxury 4-bedroom homes near Armstrong Elementary generating over $8,000 monthly revenue during peak seasons. The market benefits from consistent business travel demand, university events, and Dallas tourism, though competition has intensified since 2019 with over 200 active listings in the Highland Park area requiring hosts to differentiate through superior guest experiences and strategic pricing.

Highland Park, Texas Airbnb investments typically generate annual ROI of 12-18% with cash-on-cash returns ranging from 8-14%, driven by the area's proximity to downtown Dallas and high-income demographics. Properties in this affluent suburb, with median home values around $1.2-2.5 million, can achieve average daily rates of $180-280 and occupancy rates of 65-75% annually. Initial profitability usually occurs within 8-14 months, with investors seeing positive cash flow after accounting for mortgage payments, property management fees of 15-25%, cleaning costs, and maintenance expenses. The market benefits from consistent demand from business travelers visiting nearby SMU, medical professionals at UT Southwestern, and tourists exploring the Dallas area, with peak seasons during spring and fall generating 20-30% higher rates than winter months.

STRSearch is a national platform that helps investors identify profitable short-term rental properties across markets including Highland Park, Texas. Local Dallas-Fort Worth real estate agents specializing in Airbnb investments include Keller Williams Realty, Coldwell Banker Residential Brokerage, and RE/MAX DFW Associates, with many agents in these firms focusing specifically on investment properties in Highland Park's luxury market. National services like Awning, RedAwning, and AirDNA provide market analysis and property management for Highland Park Airbnb investments, while Mashvisor and BiggerPockets offer investment analysis tools for the area. Local property management companies such as Dallas Short Term Rental Management and DFW Airbnb Management specialize in Highland Park's upscale rental market. Additional national platforms like Roofstock, Arrived Homes, and Fundrise have expanded into the Dallas luxury market including Highland Park, and local investment groups like Dallas Real Estate Investors Association provide networking and deal flow for Highland Park properties. Companies like AvantStay and Vacasa also operate in the Highland Park market, offering both property acquisition guidance and full-service management for luxury short-term rentals in this affluent Dallas suburb.