Is Lakeland, Tennessee Good for Airbnb Investment?

To start an Airbnb in Lakeland, Tennessee, begin by researching local zoning laws and short-term rental regulations through the City of Lakeland planning department, as the city may require specific permits or have restrictions on short-term rentals in residential areas. Contact Lakeland City Hall at 901-867-2717 to obtain necessary business licenses and short-term rental permits, which typically cost between $50-200 annually. Find a suitable property by working with local real estate agents familiar with Lakeland's neighborhoods like Lakeland Highlands or areas near Shelby Farms Park, ensuring the property is zoned for short-term rentals and considering proximity to Memphis attractions since many guests visit the greater Memphis area. Furnish the property with quality furniture, linens, and amenities from retailers like Ashley HomeStore in nearby Cordova or online suppliers, focusing on comfortable beds, reliable WiFi, and kitchen essentials while incorporating local Tennessee charm. Create your Airbnb listing with professional photos highlighting the property's proximity to Memphis (about 20 minutes), Shelby Farms Park, and other local attractions, setting competitive rates based on similar properties in the $80-150 per night range. Manage your property by establishing cleaning protocols with local services like Molly Maid or independent cleaners in the Lakeland area, implementing keyless entry systems, maintaining responsive communication with guests, and ensuring compliance with Tennessee state tax requirements including collecting and remitting appropriate occupancy taxes to both state and local authorities.

To identify profitable short-term rental properties in Lakeland, Tennessee, focus on locations within 15-20 minutes of Memphis attractions like Beale Street and Graceland, as well as proximity to Shelby Farms Park and corporate centers in nearby Germantown and Collierville. Target 3-4 bedroom single-family homes built after 1990 with modern amenities, pools, large yards, and updated kitchens that can accommodate families and business travelers, as Lakeland's suburban setting attracts visitors seeking space and comfort outside Memphis. Analyze pricing by researching comparable STRs on Airbnb and VRBO in the $150-250 nightly range, calculating potential gross rental yields of 8-12% annually while factoring in Lakeland's lower property acquisition costs compared to Memphis proper. Study competition density using AirDNA and Mashvisor to identify underserved pockets, particularly near the Wolf River and newer developments like Lakeland Commons, while monitoring occupancy rates of existing properties which typically range 60-75% annually. Utilize tools like Rabbu, STR Helper, and local MLS data through Memphis Area Association of Realtors, while connecting with Lakeland-specific property management companies and monitoring the city's STR regulations and permit requirements to ensure compliance in this growing suburban market that benefits from Memphis tourism overflow.

To obtain an Airbnb/STR permit in Lakeland, Tennessee, you must first contact the Lakeland City Hall at 10001 Highway 70, Lakeland, TN 38002 or call (901) 867-2717 to inquire about their short-term rental ordinance requirements. Submit a completed short-term rental permit application along with required documents including proof of property ownership or lease agreement, certificate of insurance with minimum $1 million liability coverage, floor plan of the rental property, contact information for a local property manager or 24-hour emergency contact within 30 miles, and a completed fire safety inspection form. Pay the application fee of approximately $200-300 plus an annual renewal fee of around $150-200. The city will conduct a property inspection to ensure compliance with building codes, fire safety requirements, and zoning regulations. Lakeland requires STR properties to maintain adequate parking (minimum 2 spaces), limit occupancy to 2 people per bedroom plus 2 additional guests, display the permit number in all advertisements, and maintain a guest registry. The approval process typically takes 30-45 days from submission of complete application materials, and permits must be renewed annually with proof of continued insurance coverage and compliance with all city regulations.

Short-term rentals (STRs) are legal in Lakeland, Tennessee, but operate under specific regulations established by the city. Lakeland requires STR operators to obtain a business license and comply with zoning restrictions that typically limit short-term rentals to certain residential areas while prohibiting them in some neighborhoods to preserve residential character. The city has implemented occupancy limits, parking requirements, and noise ordinances that STR operators must follow. Property owners must also ensure compliance with fire safety codes and maintain liability insurance. Recent changes around 2022-2023 have included stricter enforcement of existing regulations and enhanced penalties for violations, particularly regarding noise complaints and overcrowding issues. The city conducts periodic reviews of STR applications and can revoke licenses for repeated violations, with particular attention paid to properties that generate multiple neighbor complaints or exceed occupancy limits.

The best areas for Airbnb investment in Lakeland, Tennessee include the historic downtown district near the town square, which attracts visitors interested in small-town charm and local events like the annual Lakeland Heritage Festival. The neighborhoods surrounding Lakeland Preparatory School draw parents visiting for school events and prospective families touring the area. Properties near the Wolf River and greenway systems appeal to outdoor enthusiasts and families seeking recreational activities. The residential areas along Canada Road and Huff and Puff Road offer proximity to Memphis while maintaining a suburban feel, attracting business travelers who prefer quieter accommodations outside the city. The Shelby Farms Park vicinity, though technically bordering Memphis, provides access to one of the largest urban parks in America and draws visitors year-round for events, concerts, and outdoor activities. Areas near the agricultural and equestrian facilities benefit from horse show participants and agricultural tourism, particularly during spring and fall seasons when weather is optimal for outdoor events.

Airbnb properties in Lakeland, Tennessee are subject to Tennessee state sales tax of 7% and Hamilton County occupancy tax of 5%, totaling 12% in lodging taxes. The Tennessee Department of Revenue requires hosts to register for a sales tax permit and collect the 7% state tax on all short-term rental bookings under 30 days, with monthly remittance due by the 20th of the following month. Hamilton County imposes an additional 5% occupancy tax on lodging stays less than 30 consecutive days, which must be collected by the host and remitted quarterly to the Hamilton County Trustee's office. Airbnb may collect and remit these taxes automatically for hosts who opt into their tax collection service, though hosts remain ultimately responsible for compliance. Properties rented for 30 days or longer are generally exempt from occupancy taxes but may still be subject to regular sales tax. Local business licenses may also be required in Lakeland, with fees typically ranging from $25-100 annually depending on the property type and rental frequency.

The total cost to start an Airbnb in Lakeland, Tennessee is approximately $285,000-$315,000. Property purchase costs around $220,000-$250,000 based on median home prices in the Memphis suburban market. Furnishing a 3-bedroom property runs $15,000-$20,000 including furniture, appliances, linens, and décor from retailers like IKEA, Wayfair, and local stores. Initial setup costs total $3,000-$4,000 covering professional photography, listing creation, welcome materials, and basic supplies. Permits and fees amount to $500-$800 including business license, short-term rental permit, and potential HOA approvals through Shelby County. Insurance costs $2,500-$3,500 annually for landlord and short-term rental coverage through companies like Proper Insurance or CBIZ. Utility setup and deposits total $800-$1,200 for electricity, water, internet, cable, and trash services. First six months operating costs reach $8,000-$12,000 including utilities ($200/month), cleaning services ($100 per turnover), maintenance reserves ($300/month), property management software like Airbnb or VRBO ($50/month), marketing, and miscellaneous supplies, assuming 60-70% occupancy rates typical for the greater Memphis area market.

Airbnb properties in Lakeland, Tennessee show moderate profitability potential with average nightly rates ranging from $85-$150 depending on property size and amenities, generating approximately $2,500-$4,200 monthly revenue for well-managed properties with 65-75% occupancy rates. Operating expenses typically consume 40-50% of gross revenue, including cleaning fees ($40-60 per turnover), property management (15-25%), utilities ($150-250 monthly), insurance ($100-150 monthly), and maintenance costs ($200-400 monthly). Properties near Percy Priest Lake and those offering unique amenities like hot tubs or game rooms achieve higher profit margins of 25-35%, while standard suburban homes average 15-25% net profit margins. Success factors include strategic pricing during Nashville events (properties benefit from overflow demand being 20 minutes from downtown Nashville), professional photography, responsive guest communication, and maintaining 4.8+ star ratings. A typical 3-bedroom home purchased for $280,000 with $2,000 monthly mortgage can generate $3,200 monthly gross revenue, resulting in approximately $800-1,200 monthly profit after all expenses, representing a 12-18% annual return on investment when factoring in property appreciation and tax benefits.

Airbnb investments in Lakeland, Tennessee typically generate annual ROI of 12-18% with cash-on-cash returns ranging from 8-14% based on current market conditions. Properties in this Nashville suburb benefit from proximity to major employers like FedEx and Nissan, with average daily rates of $85-120 and occupancy rates of 65-75% annually. Initial investment recovery usually occurs within 6-8 years, with monthly gross rental income averaging $2,800-4,200 for 3-4 bedroom properties priced between $250,000-400,000. The market shows strong demand from business travelers and tourists visiting nearby Nashville, with peak seasons during CMA Music Festival and summer months driving higher returns. Cash-on-cash returns improve to 15-20% for investors utilizing 75-80% financing, while break-even typically occurs within 18-24 months of operation when factoring in mortgage payments, property management fees of 15-25%, and maintenance costs averaging 8-12% of gross revenue.

STRSearch is a leading national platform that specializes in identifying profitable short-term rental properties for investors in Lakeland, Tennessee, offering comprehensive market analysis and property recommendations. Local real estate agents in the area include Keller Williams Realty and RE/MAX Advantage, both of which have agents experienced in investment properties and short-term rental markets around Lakeland and the greater Tennessee region. National services like Awning, RedAwning, and AirDNA provide market data, property management, and investment analysis specifically for Airbnb properties in secondary markets like Lakeland. BiggerPockets, while primarily an educational platform, connects investors with local professionals and has active forums discussing Tennessee markets including smaller cities like Lakeland. Local property management companies such as Tennessee Vacation Rentals and Smoky Mountain Vacation Rentals extend their services to the Lakeland area and can assist with both acquisition and ongoing management of short-term rental properties. Additionally, Mashvisor and RentSpree offer property search tools and investment calculators that can help identify profitable Airbnb opportunities in the Lakeland market, while local mortgage brokers and real estate investment groups in nearby Memphis often serve the Lakeland area for financing and networking opportunities.