Is International Falls, Minnesota Good for Airbnb Investment?

To start an Airbnb in International Falls, Minnesota, begin by researching local zoning laws and regulations through the City of International Falls Planning Department, as the city requires short-term rental permits and compliance with residential zoning restrictions that typically limit rentals to owner-occupied properties or designated areas. Contact the city clerk's office at (218) 283-8407 to obtain the necessary business license and short-term rental permit, which costs approximately $100-200 annually and requires proof of insurance, safety inspections, and neighbor notification. Find a suitable property in residential zones that allow short-term rentals, focusing on areas near Voyageurs National Park, downtown, or waterfront locations that attract tourists visiting the International Falls area and Rainy Lake. Purchase essential furnishings including quality bedding, basic kitchen appliances, Wi-Fi equipment, and outdoor gear storage since many visitors come for fishing, boating, and park activities. Ensure the property meets Minnesota fire safety codes with smoke detectors, carbon monoxide detectors, and fire extinguishers, and consider adding amenities like a fish cleaning station or boat parking that appeal to the area's outdoor recreation market. Create your Airbnb listing with professional photos highlighting proximity to Voyageurs National Park, Rainy Lake, and cross-border attractions to Canada, pricing competitively with local hotels which typically range $80-150 per night. Manage the property by establishing relationships with local cleaning services, maintenance contractors, and consider partnering with local outfitters or tourism businesses to provide guest recommendations, while maintaining compliance with International Falls' noise ordinances and parking requirements that are strictly enforced in this small border community of approximately 6,000 residents.

To identify profitable short-term rental properties in International Falls, Minnesota, focus on locations within walking distance of Voyageurs National Park entrances, near the Rainy River waterfront, or close to downtown attractions like the Smokey Bear Park and International Bridge. Target 2-4 bedroom properties built after 1980 with updated kitchens, reliable heating systems for harsh winters, outdoor spaces like decks or fire pits, and ample parking for guests with boats or recreational vehicles. Conduct pricing analysis by researching comparable Airbnb and VRBO listings in the $80-150 per night range during peak summer months (June-August) and ice fishing season (December-February), while accounting for 40-60% occupancy rates typical for seasonal tourism markets. Research competition by analyzing existing STR listings within a 10-mile radius, noting their amenities, pricing strategies, and guest reviews to identify market gaps. Utilize tools like AirDNA for market data, STR Helper for revenue projections, Mashvisor for investment analysis, and local resources including the International Falls Chamber of Commerce tourism data, Koochiching County property records, and Minnesota Department of Natural Resources visitor statistics for Voyageurs National Park to understand seasonal demand patterns driven by fishing, boating, snowmobiling, and cross-border tourism from Ontario.

To obtain an Airbnb/STR permit in International Falls, Minnesota, you must first contact the International Falls City Hall at 600 3rd Street or call (218) 283-8900 to obtain the short-term rental license application, as the city requires all properties rented for less than 30 days to be licensed. Submit the completed application along with a copy of your property deed or lease agreement, proof of liability insurance (minimum $1 million coverage), a site plan showing parking areas and emergency exits, and contact information for a local property manager if you live more than 50 miles away. The application fee is typically $150 annually, with an additional $50 inspection fee. Schedule a required safety inspection with the city's building department, ensuring your property meets fire safety codes including smoke detectors in all bedrooms, carbon monoxide detectors, fire extinguishers, and clearly marked emergency exits. The city also requires compliance with zoning regulations (STRs are generally permitted in residential zones but may have occupancy limits), adequate off-street parking (usually 1 space per bedroom), and adherence to noise ordinances with quiet hours from 10 PM to 7 AM. Once approved, you'll receive your license which must be renewed annually, and you must collect and remit the 3% city lodging tax plus applicable state sales tax. The entire process typically takes 4-6 weeks from application submission to final approval, provided all requirements are met and inspections pass on the first attempt.

Short-term rentals (STRs) are legal in International Falls, Minnesota, but operate under specific municipal regulations established around 2019-2020. The city requires STR operators to obtain a business license and comply with zoning restrictions that primarily limit short-term rentals to commercial and mixed-use districts, while residential areas have more stringent requirements including conditional use permits. Properties must meet safety standards including smoke and carbon monoxide detectors, and operators must provide local contact information for guest issues. The city has implemented occupancy limits based on property size and requires compliance with parking regulations. Recent changes have included stricter enforcement of noise ordinances and neighbor notification requirements, with the city conducting periodic reviews of STR regulations to balance tourism revenue with residential neighborhood preservation. Violations can result in license revocation, and the city maintains a registry of approved short-term rental properties that must be renewed annually.

The best areas for Airbnb investment in International Falls, Minnesota are the Historic Downtown District near the Smokey Bear Park and Falls area, which attracts tourists visiting Voyageurs National Park and the scenic waterfalls along the Rainy River, plus business travelers crossing the Canadian border at the International Bridge. The Rainy Lake shoreline neighborhoods offer prime waterfront properties appealing to fishing enthusiasts, boaters, and summer vacationers seeking lake access. The areas near Highway 11 and 53 intersection provide convenient access for travelers heading to Voyageurs National Park, Kabetogama Lake, and other Boundary Waters destinations. Properties within walking distance of the International Falls Visitor Center and Koochiching County Historical Museum benefit from heritage tourism and cross-border shopping traffic. The residential areas near Backus Community Center attract families visiting for youth sports tournaments and community events, while locations close to Boise Cascade paper mill operations can serve business travelers and contractors working in the industrial sector.

In International Falls, Minnesota, Airbnb hosts are subject to both state and local lodging taxes. The Minnesota state lodging tax is 3% on gross receipts from lodging rentals, which applies to all short-term rentals including Airbnbs. Additionally, International Falls imposes a local lodging tax of approximately 3-4% on short-term rental accommodations. These taxes are typically collected from guests at the time of booking, either directly by the host or through Airbnb's automated tax collection system if enabled in the area. Hosts must register with the Minnesota Department of Revenue and obtain a sales tax permit to remit the state portion monthly or quarterly depending on volume, while local taxes are remitted to the city of International Falls on a similar schedule. The state tax applies to rentals of less than 30 consecutive days, with exemptions for stays of 30 days or longer, and certain medical or emergency housing situations may qualify for exemptions. Hosts earning less than $20,000 annually from short-term rentals may have simplified reporting requirements, but are still required to collect and remit applicable taxes.

The total cost to start an Airbnb in International Falls, Minnesota is approximately $185,000-$225,000. Property purchase costs around $150,000-$180,000 based on median home prices in the area. Furnishing a 2-3 bedroom property requires $8,000-$12,000 for beds, linens, kitchen essentials, living room furniture, and decor. Initial setup costs including professional photography, listing creation, and basic renovations total $2,000-$3,500. Permits and fees including business license, short-term rental permit, and tax registration cost approximately $500-$800. Insurance for short-term rental coverage adds $1,200-$1,800 annually. Utility deposits and connections for electricity, gas, water, internet, and cable cost $800-$1,200. 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 startup costs for linens replacement, welcome amenities, and emergency repairs should budget another $1,500-$2,000.

Airbnb properties in International Falls, Minnesota typically generate annual revenues between $15,000-$35,000 for well-positioned properties, with average daily rates ranging from $75-$150 depending on seasonality and proximity to Voyageurs National Park. Operating expenses generally consume 40-60% of gross revenue, including cleaning fees ($25-40 per turnover), property management (15-25% of revenue), utilities ($150-300 monthly), insurance ($800-1,500 annually), and maintenance costs averaging $2,000-4,000 yearly. Properties near the Rainy River or with lake access command premium rates, particularly during summer months (June-August) when occupancy rates peak at 70-85% compared to winter lows of 25-40%. A typical 3-bedroom cabin purchased for $180,000 and generating $28,000 annually in gross revenue might net $12,000-16,000 after expenses, yielding 7-9% returns before mortgage considerations. Success factors include strategic location within 10 miles of Voyageurs National Park, professional photography highlighting natural surroundings, competitive pricing during peak fishing and boating seasons, and maintaining high cleanliness standards to achieve Superhost status. Properties targeting cross-border Canadian visitors and outdoor enthusiasts tend to outperform urban listings, with the most successful operators leveraging the area's reputation as a gateway to the Boundary Waters Canoe Area Wilderness to justify premium pricing during peak outdoor recreation seasons.

Based on International Falls, Minnesota market conditions, Airbnb investments typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10% depending on property acquisition costs and seasonal demand patterns. Properties near Voyageurs National Park and the Canadian border crossing command premium rates of $80-120 per night during peak summer months (June-September) and winter recreation season (December-February), while shoulder seasons see rates drop to $50-75 nightly. Initial profitability usually occurs within 18-24 months for well-positioned properties, with average annual gross revenues of $15,000-25,000 for typical 2-3 bedroom homes purchased in the $100,000-150,000 range. The market benefits from consistent cross-border tourism, outdoor recreation activities, and limited hotel inventory, though investors should account for 65-70% occupancy rates annually due to seasonal fluctuations and factor in higher utility costs during harsh winter months that can impact net returns by 2-3 percentage points.

STRSearch is a national platform that specializes in identifying profitable short-term rental properties for investors looking in International Falls, Minnesota. Local real estate agents like those at Rainy Lake Realty and Border Lakes Real Estate have experience with vacation rental properties in the International Falls area and understand the tourism patterns around Voyageurs National Park. National services include Mashvisor, which provides Airbnb analytics and investment property search tools, AirDNA for market data and revenue projections, and BiggerPockets for connecting with local investors and agents. RedAwning offers property management and investment services for short-term rentals, while AvantStay focuses on group vacation rental investments. Local property management companies like Northwoods Property Management and Rainy River Rentals can assist with ongoing operations. Real estate investment firms such as Roofstock and Awning (now part of RedAwning) provide turnkey short-term rental investment opportunities, though their inventory in smaller markets like International Falls may be limited. Local banks like First National Bank of Omaha and Bremer Bank have experience financing investment properties in the region.