Is Holly Grove, Arkansas Good for Airbnb Investment?

To start an Airbnb in Holly Grove, Arkansas, begin by researching local regulations through Monroe County and Holly Grove city offices, as Arkansas generally allows short-term rentals but local municipalities may have specific requirements including business licenses, occupancy permits, and tax registration with the Arkansas Department of Finance and Administration for state sales tax collection. Contact Monroe County Planning and Zoning Department to verify zoning compliance and obtain necessary permits, which typically include a business license ($25-50 annually) and potentially a conditional use permit if operating in residential zones. Find a suitable property by searching local real estate listings, considering proximity to Arkansas River attractions, Delta Cultural Center activities, or agricultural tourism sites, with properties typically ranging $30,000-80,000 in Holly Grove's market. Furnish the space with essential amenities including reliable internet, air conditioning, comfortable bedding, kitchen basics, and local guidebooks highlighting nearby attractions like the Arkansas Post National Memorial or Stuttgart's waterfowl hunting areas. Create your Airbnb listing with professional photos, competitive pricing around $60-90 per night based on regional comparisons, and descriptions emphasizing rural charm and outdoor recreation access. Manage the property by establishing cleaning protocols between guests, maintaining responsive communication, coordinating key exchanges or lockbox systems, and ensuring compliance with Arkansas's 11.5% combined state and local tax obligations while keeping detailed records for annual business tax filings with both state and federal authorities.

To identify profitable short-term rental properties in Holly Grove, Arkansas, focus on properties within 2-3 miles of the Arkansas River and Mississippi River confluence, as this area attracts fishing and hunting enthusiasts year-round. Target 2-4 bedroom homes built after 1980 with updated kitchens, reliable HVAC systems, and outdoor spaces like decks or fire pits that appeal to outdoor recreation visitors. Pricing analysis should consider the limited local hotel options, with competitive rates likely ranging $80-150 per night depending on property size and amenities, while monitoring seasonal demand spikes during duck hunting season (November-January) and fishing tournaments. Research competition by analyzing the few existing Airbnb and VRBO listings within a 15-mile radius, noting that properties near Dagmar Wildlife Management Area and White River National Wildlife Refuge command premium rates. Utilize AirDNA for market data, STR Helper for performance tracking, and local Facebook groups like "Arkansas Duck Hunters" to understand guest preferences, while partnering with local outfitters and hunting guides for referral opportunities since Holly Grove's economy heavily relies on outdoor tourism and agriculture.

To obtain an Airbnb/STR permit in Holly Grove, Arkansas, contact the Holly Grove City Hall at 870-748-2274 or visit their office at 117 College Street to inquire about short-term rental regulations and application procedures. You will likely need to submit a completed business license application, proof of property ownership or lease agreement, certificate of insurance with minimum $1 million liability coverage, floor plan of the rental property, and contact information for a local property manager if you live more than 50 miles away. Required documents typically include a valid Arkansas state ID, property tax records, fire safety inspection certificate, and zoning compliance verification. The application fee is estimated at $100-200 annually, with additional inspection fees of approximately $50-75. The approval timeline is generally 30-45 days from submission of complete application materials. Holly Grove specific requirements may include maintaining guest registries, posting emergency contact information prominently in the rental unit, ensuring adequate parking spaces, and complying with noise ordinances between 10 PM and 7 AM. You must also register with the Arkansas Department of Finance and Administration for state tax collection purposes and may need to obtain a Monroe County business license depending on your property location within city limits.

Short-term rentals (STRs) in Holly Grove, Arkansas are generally legal as the state of Arkansas does not prohibit STRs at the state level, and Holly Grove, a small town in Monroe County with approximately 600 residents, does not appear to have specific municipal ordinances restricting or regulating short-term rentals as of 2024. The town operates under basic zoning regulations that typically allow residential properties to be used for rental purposes, though property owners should verify compliance with any residential zoning requirements and ensure proper business licensing through Monroe County if required. Arkansas state law requires STR operators to collect and remit state sales tax and local occupancy taxes where applicable, and properties must meet basic safety and health standards. There have been no recent significant legal changes specifically affecting Holly Grove, though property owners should monitor potential future regulations as Arkansas communities increasingly address STR oversight, and they should also ensure compliance with any homeowners association rules if applicable and maintain proper insurance coverage for rental activities.

The best areas for Airbnb investment in Holly Grove, Arkansas are primarily concentrated around the downtown historic district near Main Street and the Arkansas River waterfront area, which attracts visitors interested in Delta blues heritage and river recreation activities. The residential neighborhoods adjacent to Highway 49 offer good accessibility for business travelers and hunters visiting during duck season (November-January), as Holly Grove is situated in prime waterfowl hunting territory within the Mississippi Flyway. Properties near the Holly Grove Community Center and school district appeal to families visiting for local events and sports tournaments, while homes closer to the agricultural areas on the town's outskirts attract agritourism visitors and those attending farming conferences or equipment demonstrations. The area around Cache River National Wildlife Refuge access points, approximately 10 miles southeast, provides opportunities for eco-tourism and bird watching enthusiasts, making nearby Holly Grove properties attractive as base accommodations for multi-day nature experiences.

Holly Grove, Arkansas does not currently impose specific lodging or occupancy taxes on Airbnb rentals as of 2024. The city relies primarily on standard Arkansas state sales tax of 6.5% plus local sales tax which typically ranges from 1-3% in small Arkansas municipalities like Holly Grove, bringing the total sales tax to approximately 7.5-9.5% that would apply to short-term rental income. Airbnb automatically collects and remits Arkansas state sales tax on behalf of hosts through their platform since 2019, but hosts remain responsible for collecting and remitting any applicable local sales taxes directly to Holly Grove's city clerk office on a monthly basis by the 20th of the following month. There are generally no exemptions for short-term rentals under 30 days, though stays of 30 days or longer may be exempt from transient lodging classifications. Property owners should also be aware that rental income is subject to standard Arkansas income tax reporting requirements and may need to obtain a local business license from Holly Grove city hall, though specific lodging tax ordinances have not been enacted by this small Delta community of approximately 600 residents.

The total cost to start an Airbnb in Holly Grove, Arkansas would be approximately $95,000-$115,000. Property purchase costs around $65,000-$80,000 based on the median home price in rural Arkansas Delta region communities. Furnishing a 2-3 bedroom property with quality furniture, appliances, linens, and décor runs $8,000-$12,000. Initial setup including professional photography, listing creation, and basic renovations costs $2,000-$4,000. Permits and fees including business license, short-term rental permit, and tax registration total $300-$800. Insurance for short-term rental coverage adds $1,200-$2,000 annually. Utility deposits and connections for electricity, water, internet, and cable cost $500-$800. First six months operating costs including utilities ($600/month), cleaning supplies ($100/month), maintenance reserves ($200/month), property management software ($50/month), and marketing ($100/month) total approximately $6,300. Additional considerations include potential HOA fees, property taxes, and a 10-15% contingency fund for unexpected expenses during the startup phase.

Airbnb properties in Holly Grove, Arkansas show modest profitability potential with average nightly rates ranging from $65-85 for typical 2-3 bedroom homes, generating approximately $15,000-25,000 in annual gross revenue based on 40-50% occupancy rates common in rural Arkansas markets. Operating expenses typically consume 60-70% of gross revenue, including property management fees (15-20%), cleaning costs ($30-40 per turnover), utilities ($150-200 monthly), insurance ($1,200-1,800 annually), and maintenance reserves (8-12% of revenue), resulting in net profit margins of 15-25% for well-managed properties. Success factors in this Delta region market include proximity to the White River for fishing tourism, competitive pricing against Little Rock properties 90 minutes away, and targeting hunters during fall seasons when rates can increase 30-40%. Properties near outdoor recreation areas like Dagmar Wildlife Management Area perform better, with some hosts reporting annual net profits of $4,000-8,000 on properties valued at $80,000-120,000, though the limited tourism infrastructure and seasonal demand patterns present challenges compared to more established Arkansas markets like Eureka Springs or Hot Springs.

Based on Holly Grove, Arkansas market conditions, Airbnb investments in this small Delta region town typically generate annual ROI of 8-12% due to limited tourism infrastructure and seasonal hunting/fishing demand. Cash-on-cash returns average 6-9% annually, with properties requiring initial investments of $40,000-$80,000 for modest 2-3 bedroom homes. Profitability timeframes extend 18-24 months given the rural location's limited year-round visitor base, though properties near Arkansas River access points or hunting lodges may achieve break-even within 12-15 months. The market benefits from low property acquisition costs but faces challenges with occupancy rates averaging 35-45% annually, primarily driven by seasonal outdoor recreation visitors and occasional business travelers to nearby agricultural operations.

STRSearch is a national platform that helps investors identify profitable short-term rental properties across markets including Holly Grove, Arkansas. Local real estate agents in the Arkansas River Delta region such as Century 21 Wright Real Estate in Stuttgart (approximately 30 miles away) and Coldwell Banker Elite in Little Rock often work with investors seeking vacation rental properties in rural Arkansas markets. National services like Mashvisor, AirDNA, and BiggerPockets provide market analysis tools for small Arkansas towns, while companies such as RedAwning and AvantStay offer property management services that extend to rural Arkansas markets. Local property management companies like Arkansas Vacation Rentals and Delta Property Management in nearby Helena-West Helena can assist with Airbnb operations, and real estate investment firms such as Arkansas Investment Properties and Mid-South Real Estate Investors occasionally work in Phillips County where Holly Grove is located. Additional national platforms like Roofstock, Awning, and AirbnbAutomated provide end-to-end services for investors looking to enter markets in small Arkansas Delta communities, though availability in Holly Grove specifically may be limited due to the town's small size of approximately 600 residents.