Is Horatio, Arkansas Good for Airbnb Investment?

To start an Airbnb in Horatio, Arkansas, begin by researching local zoning laws and regulations through the Sevier County Planning and Zoning Department, as Horatio typically falls under county jurisdiction rather than having its own municipal short-term rental ordinances. Contact Sevier County at (870) 642-2852 to verify if short-term rentals are permitted in your specific zone and obtain any required business licenses or permits, which may cost approximately $50-150 annually. Find a suitable property by searching local real estate listings through companies like Coldwell Banker or RE/MAX in nearby De Queen or Arkadelphia, with average property prices in Horatio ranging from $80,000-200,000 for suitable rental homes. Furnish the property with essential amenities including quality bedding, kitchen appliances, Wi-Fi, and local touches highlighting Arkansas culture, budgeting approximately $8,000-15,000 for complete furnishing. Create your Airbnb listing with professional photos showcasing the property's proximity to DeGray Lake State Park and Crater of Diamonds State Park, setting competitive rates around $75-125 per night based on local market analysis. For ongoing management, establish cleaning protocols between guests, respond promptly to inquiries, and consider hiring local cleaning services from nearby Murfreesboro or Nashville, Arkansas, while maintaining compliance with Arkansas state tax requirements by registering for sales tax collection through the Arkansas Department of Finance and Administration.

To identify profitable short-term rental properties in Horatio, Arkansas, focus on properties within 2-3 miles of Millwood Lake and De Gray Lake State Park, as these water recreation areas drive seasonal tourism from April through October. Target 2-4 bedroom homes with lake views, boat parking, fishing amenities, and outdoor spaces like decks or fire pits, as these features command premium rates of $120-180 per night compared to standard properties at $80-120. Analyze pricing using AirDNA and Mashvisor to track occupancy rates around major fishing tournaments and hunting seasons, while researching competition through Airbnb and VRBO searches within a 15-mile radius to identify gaps in luxury or pet-friendly accommodations. Utilize the Sevier County tax assessor's website for property values, partner with local realtors familiar with lakefront properties, and monitor Facebook groups like "Millwood Lake Community" and "Arkansas Fishing Reports" to understand guest preferences and seasonal demand patterns, ensuring your investment targets the 65-75% occupancy rates typical for successful lake-area STRs in rural Arkansas markets.

To obtain an Airbnb/STR permit in Horatio, Arkansas, you must first contact the Horatio City Hall at 870-832-5463 or visit their office at 101 Main Street to inquire about short-term rental regulations, as this small town may not have formal STR ordinances but typically requires a business license. Submit an application for a business license along with required documents including property deed or lease agreement, proof of insurance with minimum $1 million liability coverage, floor plan of the rental property, and completed Arkansas Department of Finance and Administration sales tax permit application. Pay the estimated business license fee of $50-100 annually and sales tax permit fee of $50 to the city clerk, then register with Arkansas Department of Finance and Administration for state tax collection purposes with an additional $50 fee. The approval timeline is typically 2-4 weeks for processing, during which the city may conduct a property inspection to ensure compliance with fire safety codes, occupancy limits, and parking requirements. Horatio specifically requires STR properties to maintain adequate off-street parking for guests, display the business license number in rental listings, collect and remit local sales taxes quarterly, and ensure properties meet residential zoning compliance if operating in residential areas.

Short-term rentals (STRs) are generally legal in Horatio, Arkansas, as the state of Arkansas does not prohibit STRs at the state level and allows local municipalities to regulate them. Horatio, a small city in Sevier County with approximately 1,000 residents, does not appear to have specific municipal ordinances prohibiting short-term rentals as of 2024. However, operators must comply with standard business licensing requirements, collect and remit state and local sales taxes (currently 6.5% state sales tax plus local taxes), and ensure properties meet basic safety and zoning requirements for residential areas. The city may require STR operators to obtain a business license and comply with residential zoning restrictions, though enforcement in smaller Arkansas municipalities like Horatio tends to be less stringent than in larger cities. Property owners should verify current local regulations with Horatio city officials, as small municipalities can implement new restrictions relatively quickly, and ensure compliance with homeowners association rules if applicable, while also maintaining proper insurance coverage for rental activities.

The best areas for Airbnb investment in Horatio, Arkansas would be the historic downtown district near Main Street, which attracts visitors interested in small-town charm and antique shopping, and properties near the Little River corridor, which draws fishing enthusiasts and outdoor recreation tourists year-round. The residential areas close to Highway 41 offer good accessibility for business travelers passing through or visiting local agricultural operations, while neighborhoods near Horatio High School and community centers can capture family visitors attending local events and sports tournaments. Properties within walking distance of local restaurants and the few commercial establishments provide convenience that guests value, and homes with larger lots or rural settings on the outskirts appeal to hunters during deer season (November-January) and visitors seeking peaceful retreats, making these areas particularly attractive due to limited hotel options in this small Sevier County community of approximately 1,000 residents.

Airbnb properties in Horatio, Arkansas are subject to Arkansas state sales tax of 6.5% on lodging accommodations, which applies to short-term rentals under 30 days. The state requires hosts to register for a sales tax permit and collect taxes from guests, remitting payments monthly if collections exceed $200 or quarterly if under $200 through the Arkansas Taxpayer Access Point (ATAP) system. Horatio, being a small city in Sevier County, does not impose additional local lodging taxes beyond the state requirement, though hosts should verify with Sevier County for any county-level occupancy taxes that may apply. Collections are typically handled by Airbnb directly for most hosts through their tax collection service, which automatically adds the appropriate tax to guest bookings and remits to the state on behalf of the host. Exemptions may apply for stays exceeding 30 consecutive days, which are generally considered long-term rentals rather than taxable lodging, and for certain government or non-profit travelers with proper documentation.

The total cost to start an Airbnb in Horatio, Arkansas would be approximately $85,000-$95,000. Property purchase costs around $65,000 based on the median home price in rural Arkansas communities like Horatio. Furnishing a 2-3 bedroom property would cost $8,000-$12,000 including beds, sofas, dining sets, appliances, linens, and basic decor from retailers like IKEA, Wayfair, and local furniture stores. Initial setup costs including professional photography, listing creation, and basic renovations total $2,000-$3,000. Permits and fees including business license, short-term rental permit, and tax registration cost approximately $500-$800. Insurance including landlord and short-term rental coverage runs $1,200-$1,800 annually. Utility deposits and connections for electricity, water, internet, and cable cost $400-$600. First six months operating costs including utilities ($180/month), cleaning supplies ($50/month), maintenance reserves ($100/month), marketing ($75/month), and platform fees (3% of estimated $800 monthly revenue) total approximately $2,500-$3,000, bringing the complete startup investment to the $85,000-$95,000 range.

Airbnb properties in Horatio, Arkansas, a small town of approximately 1,000 residents in Sevier County, face challenging profitability conditions due to limited tourism demand and low market rates. Properties in this rural area typically generate $200-400 monthly revenue with average daily rates of $45-65, significantly below Arkansas's statewide average of $85. Annual gross revenues range from $2,400-4,800 for occasional rentals, while expenses including property taxes ($800-1,200), insurance ($1,500-2,000), utilities ($1,200-1,800), cleaning ($600-1,000), and maintenance ($800-1,500) often total $4,900-7,500 annually, resulting in negative profit margins of -50% to -105% for most operators. Success factors in this market require minimal property acquisition costs under $50,000, targeting hunting/fishing enthusiasts visiting nearby Millwood Lake, and maintaining occupancy rates above 40% to achieve break-even. Properties positioned as budget-friendly retreats for outdoor recreation, particularly during deer hunting season (November-January) and fishing season (March-October), show marginally better performance with potential 5-15% profit margins, though most Horatio Airbnb ventures struggle to achieve sustainable profitability due to insufficient visitor volume and competition from established lodging in nearby De Queen and Ashdown.

Airbnb investments in Horatio, Arkansas typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10%, primarily driven by the town's proximity to outdoor recreation areas along the Little River and seasonal hunting tourism. Properties in this small Scott County community of approximately 1,100 residents generally achieve profitability within 18-24 months, with average nightly rates of $75-95 for 2-3 bedroom homes and occupancy rates of 45-60% annually. The market benefits from limited hotel accommodations in the area, creating opportunities for short-term rentals serving visitors to nearby Ouachita National Forest and Lake Ouachita, though investors should expect seasonal fluctuations with peak performance during spring and fall months when outdoor activities drive demand.

STRSearch is a leading national platform that specializes in identifying profitable short-term rental properties for Airbnb investors, offering comprehensive market analysis and property recommendations in Horatio, Arkansas. Local real estate agents in the area who work with investors include Century 21 agents and Coldwell Banker professionals who understand the vacation rental market dynamics in Pike County. National services like Mashvisor provide detailed Airbnb analytics and investment property search tools, while AirDNA offers market data and revenue projections for the Horatio market. RedAwning and Vacasa provide property management services for investors looking to optimize their Airbnb operations in the region. Local property management companies such as Arkansas Vacation Rentals and regional firms like Ozark Mountain Property Management can assist with day-to-day operations. Investment-focused platforms like BiggerPockets connect investors with local professionals, while companies like Awning and AvantStay offer full-service solutions from acquisition to management. Real estate investment firms such as Roofstock and Arrived Homes occasionally feature properties in smaller Arkansas markets, and local investors often work with community banks like First National Bank of DeQueen for financing vacation rental properties in the Horatio area.