Is Ipswich, Massachusetts Good for Airbnb Investment?

To start an Airbnb in Ipswich, Massachusetts, begin by researching local zoning laws and short-term rental regulations through the Ipswich Planning Department, as the town requires short-term rental operators to obtain a business license and comply with specific occupancy limits typically capped at 4-6 guests depending on property size. Contact the Ipswich Building Department to secure necessary permits including a Certificate of Occupancy for short-term rentals, fire safety inspections, and ensure compliance with Massachusetts State Sanitary Code requirements. Find a suitable property in residential zones that allow short-term rentals, focusing on areas near Crane Beach or historic downtown Ipswich which attract tourists, with properties typically ranging from $400,000-$800,000 for purchase or $2,000-$4,000 monthly for rental arbitrage opportunities. Furnish the space with coastal New England décor, essential amenities including Wi-Fi, linens, kitchen supplies, and safety equipment like smoke detectors and carbon monoxide alarms as required by Massachusetts law. Register for a Massachusetts business license, obtain liability insurance coverage of at least $1 million, and collect the 14.95% combined state and local occupancy tax (5.7% state excise tax, 6.25% state sales tax, and 3% local option tax). List your property on Airbnb, VRBO, and other platforms with professional photography highlighting proximity to Crane Beach, Ipswich River, and historic attractions, setting competitive rates of $150-$350 per night depending on season and property size. Manage operations by establishing check-in procedures, maintaining regular cleaning schedules, responding promptly to guest communications, and ensuring compliance with noise ordinances and parking restrictions that are strictly enforced in Ipswich's residential neighborhoods.

To identify profitable short-term rental properties in Ipswich, Massachusetts, focus on locations within walking distance of Crane Beach, the historic downtown district along Market Street, or properties with water views near the Ipswich River and Great Marsh. Target 3-4 bedroom single-family homes or historic colonial properties built before 1900 that offer authentic New England charm, modern amenities like updated kitchens and bathrooms, outdoor spaces for summer entertaining, and parking for 2-3 vehicles. Analyze pricing by researching comparable Airbnb listings in nearby coastal towns like Newburyport and Essex, aiming for nightly rates between $200-400 depending on seasonality, with peak summer months (June-September) commanding premium pricing due to beach proximity. Conduct competition research using AirDNA and Mashvisor to assess occupancy rates and revenue potential, noting that Ipswich has limited STR inventory compared to larger coastal markets, creating opportunity for well-positioned properties. Utilize local resources including the Ipswich Chamber of Commerce for tourism data, check town zoning regulations and STR permit requirements, monitor MLS listings through local realtors familiar with the North Shore market, and leverage tools like Rabbu and Pricelabs for dynamic pricing optimization while considering the town's seasonal tourism patterns driven by Crane Beach visitors, fall foliage seekers, and proximity to Boston (35 miles south).

To obtain an Airbnb/STR permit in Ipswich, Massachusetts, you must first contact the Ipswich Building Department at Town Hall located at 25 Green Street to begin the application process, as the town requires short-term rental operators to obtain a lodging house license under Massachusetts General Laws Chapter 140. You'll need to submit a completed lodging house license application, proof of property ownership or lease agreement, a detailed floor plan of the rental unit, certificate of occupancy, proof of liability insurance (typically $1 million minimum), fire safety inspection certificate from the Ipswich Fire Department, and a septic system inspection if applicable. The application fee is approximately $200-300 annually, with additional inspection fees of around $100-150 for fire and building inspections. The timeline typically takes 4-6 weeks from submission to approval, provided all documentation is complete and inspections pass. Ipswich-specific requirements include maintaining a maximum occupancy of 2 people per bedroom plus 2 additional guests, ensuring adequate parking spaces (typically 1 space per bedroom), maintaining quiet hours from 10 PM to 8 AM, providing emergency contact information to neighbors within 150 feet of the property, and conducting regular safety inspections of smoke and carbon monoxide detectors. You must also register with the Massachusetts Department of Revenue for tax collection purposes and may need additional approvals from the Board of Health for septic capacity if your property uses a septic system rather than municipal sewer.

Short-term rentals (STRs) are legal in Ipswich, Massachusetts, but operate under local regulations that were updated around 2019-2020 following statewide legislation. The town requires STR operators to obtain a local permit and comply with health and safety standards, including smoke and carbon monoxide detectors. Properties must be registered with the state and operators must collect and remit local and state taxes. Ipswich typically restricts STRs to owner-occupied properties or limits the number of rental days per year, and there may be specific zoning restrictions in certain residential districts. The town has implemented noise ordinances and parking requirements to address neighborhood concerns, and violations can result in permit revocation. Recent changes have focused on strengthening enforcement mechanisms and clarifying registration requirements to ensure compliance with both local bylaws and Massachusetts state regulations that took effect in 2019.

The most promising Airbnb investment areas in Ipswich, Massachusetts include the Historic Downtown District near the Whipple House and other colonial-era attractions, which draws history enthusiasts and weekend tourists year-round, and the Crane Beach vicinity, particularly properties within walking distance or short drive to this renowned barrier beach that attracts summer visitors from Boston and beyond. The Little Neck area offers waterfront appeal for guests seeking coastal experiences, while properties near the Ipswich River provide scenic settings popular with nature lovers and kayakers. The Town Hill neighborhood, with its historic charm and proximity to both downtown amenities and natural attractions, presents strong rental potential due to its central location. Areas near Route 1A benefit from easy access for Boston commuters doing extended stays, and properties close to the Ipswich Museum and various antique shops capitalize on the town's reputation as an antiquing destination. The summer season drives peak demand due to beach tourism, while fall foliage season and proximity to Salem's Halloween attractions extend the profitable rental period, making waterfront and historic district properties particularly valuable investments.

In Ipswich, Massachusetts, Airbnb hosts are subject to both state and local lodging taxes. The Massachusetts state room occupancy excise tax is 5.7% on rentals under 90 consecutive days, collected by the state and remitted monthly by hosts or platforms like Airbnb when they collect on behalf of hosts. Additionally, Ipswich imposes a local room occupancy tax of 6% on short-term rentals, which must be collected from guests and remitted quarterly to the town. Hosts must register with both the Massachusetts Department of Revenue and the Town of Ipswich, obtaining the necessary tax identification numbers. The state tax applies to the total rent charged, while the local tax typically applies to the same base. Exemptions generally include rentals of 90 days or longer, which are considered long-term leases rather than transient accommodations. Some platforms like Airbnb may collect and remit these taxes automatically for hosts, but hosts remain ultimately responsible for compliance. Failure to collect and remit these taxes can result in penalties and interest charges from both state and local authorities.

Starting an Airbnb in Ipswich, Massachusetts requires approximately $650,000-$750,000 in total initial investment. Property purchase costs around $575,000 based on median home prices in the area as of 2023. Furnishing a 2-3 bedroom property typically runs $15,000-$25,000 including beds, linens, kitchen essentials, living room furniture, and decor. Initial setup costs including professional photography, listing creation, and basic renovations average $3,000-$5,000. Permits and fees in Massachusetts include short-term rental registration ($200), business license ($50), and potential local permits ($300-$500). Insurance for short-term rentals costs approximately $2,000-$3,500 annually. Utility setup and deposits for electricity, gas, water, internet, and cable total around $1,500-$2,500. First six months of operating costs including utilities ($1,800), cleaning services ($2,400), maintenance ($1,500), property management software ($300), and marketing ($500) amount to approximately $6,500. Additional considerations include potential HOA fees, property taxes, and a cash reserve for unexpected expenses, bringing the comprehensive startup investment to the upper end of the estimated range.

Airbnb properties in Ipswich, Massachusetts typically generate annual revenues between $15,000-$35,000 for seasonal properties and $8,000-$18,000 for year-round rentals, with average daily rates ranging from $120-$200 depending on proximity to Crane Beach and property amenities. Operating expenses generally consume 40-60% of gross revenue, including cleaning fees ($50-$80 per turnover), property management (15-25% of revenue), utilities ($150-$300 monthly), insurance ($1,200-$2,500 annually), and maintenance costs averaging $2,000-$4,000 yearly. Properties within walking distance of Crane Beach or historic downtown achieve the highest occupancy rates of 60-75% during peak summer months (June-September) but drop to 25-35% in winter, resulting in net profit margins of 15-25% for well-managed properties. Success factors include professional photography showcasing coastal proximity, competitive pricing during shoulder seasons, partnerships with local wedding venues given Ipswich's popularity for events, and amenities like beach equipment or kayaks that justify premium rates. A typical three-bedroom colonial near the beach might gross $28,000 annually with $16,000 in expenses, yielding $12,000 profit (43% margin), while inland properties often struggle with 10-15% margins due to lower demand and pricing power.

Airbnb investments in Ipswich, Massachusetts typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10%, driven by the town's proximity to Boston (35 miles north) and seasonal tourism appeal along the North Shore. Properties in historic downtown areas or near Crane Beach command premium rates of $150-250 per night during peak summer months (June-September), while off-season rates drop to $80-120 per night. Initial investment costs average $400,000-600,000 for suitable properties, with renovation expenses of $20,000-40,000 to meet short-term rental standards. Monthly gross revenues typically range from $2,500-4,500 depending on property size and location, with operating expenses including cleaning fees, utilities, insurance, and the town's 6% short-term rental tax consuming approximately 40-50% of gross income. Most investors achieve profitability within 18-24 months, factoring in seasonal fluctuations where summer months generate 60-70% of annual revenue. The market benefits from Ipswich's appeal to Boston-area visitors seeking coastal retreats, though investors should account for potential regulatory changes as Massachusetts municipalities increasingly scrutinize short-term rental operations.

STRSearch is a national platform that helps investors identify profitable short-term rental properties in Ipswich, Massachusetts, using data analytics to evaluate potential returns. Local real estate agents specializing in investment properties include Coldwell Banker Realty agents who focus on the North Shore market, RE/MAX agents with vacation rental expertise, and Keller Williams agents experienced in Airbnb investments in the Ipswich area. National services include BiggerPockets for networking and deal analysis, Mashvisor for property analytics and market research, AirDNA for short-term rental data and performance metrics, and Awning for turnkey Airbnb investment properties. Local property management companies like North Shore Property Management and Essex County vacation rental specialists can assist with ongoing operations, while investment-focused real estate firms such as Compass and Century 21 have agents knowledgeable about the Ipswich vacation rental market, particularly given the town's proximity to beaches and Boston attractions that drive tourist demand.