Is Lakewood, Colorado Good for Airbnb Investment?

To start an Airbnb in Lakewood, Colorado, begin by researching the city's short-term rental regulations, which require a business license and compliance with zoning restrictions that typically limit rentals to no more than 120 days per year in residential areas. Contact Lakewood's Planning Department at 303-987-7730 to obtain the necessary short-term rental permit, which costs approximately $200-300 annually and requires property inspection for safety compliance including smoke detectors, carbon monoxide detectors, and fire extinguishers. Find a suitable property in permitted zones, focusing on areas near attractions like Belmar District or Bear Creek Lake Park, ensuring the property meets minimum square footage requirements of 400 square feet and has separate entrance access. Furnish the space with quality essentials including comfortable bedding, kitchen appliances, WiFi, and local guidebooks highlighting nearby Red Rocks Amphitheatre and downtown Denver attractions. Create your Airbnb listing with professional photos, competitive pricing around $80-150 per night based on Lakewood market rates, and detailed descriptions emphasizing proximity to outdoor recreation and Denver access via light rail. Manage your property by maintaining 24/7 guest communication, coordinating cleaning services between stays, collecting the required 8.31% combined state and local taxes, and ensuring compliance with occupancy limits typically set at 2 guests per bedroom plus 2 additional guests, while maintaining detailed records for annual permit renewal and potential city inspections.

To identify profitable short-term rental properties in Lakewood, Colorado, focus on locations within 15-20 minutes of downtown Denver, near popular attractions like Red Rocks Amphitheatre, Belmar shopping district, and Bear Creek Lake Park, while prioritizing neighborhoods with easy highway access and walkable amenities. Target 2-4 bedroom properties built after 1980 with updated kitchens, multiple bathrooms, parking spaces, outdoor areas, and unique features like mountain views or proximity to trails, as these command higher nightly rates of $120-250 depending on size and location. Conduct pricing analysis using AirDNA, Mashvisor, and STR Helper to evaluate average daily rates, occupancy rates (typically 60-75% in Lakewood), and seasonal demand patterns, while calculating potential gross revenue against mortgage, utilities, cleaning, and management costs to ensure 15-20% cash-on-cash returns. Research competition by analyzing similar properties within a 2-mile radius using Airdna's market data, examining their pricing strategies, amenities, guest reviews, and booking calendars to identify gaps in the market or opportunities for differentiation. Utilize Lakewood-specific resources including the city's STR licensing requirements, local property management companies like RedAwning or Vacasa, Jefferson County property records for comparable sales data, and Denver Metro Association of Realtors MLS data to make informed investment decisions while ensuring compliance with local regulations that require business licenses and limit rentals to primary residences in some zones.

To obtain an Airbnb/STR permit in Lakewood, Colorado, you must first apply through the City of Lakewood's Planning Department located at 480 South Allison Parkway or online through their permit portal. Required documents include a completed short-term rental application, proof of property ownership or lease agreement with landlord consent, floor plan of the rental unit, parking plan showing adequate off-street parking, contact information for a local responsible party available 24/7, and proof of liability insurance with minimum $1 million coverage. The application fee is approximately $200-300 with an annual renewal fee of $150-200. Lakewood requires STRs to be owner-occupied or have the owner live within 25 miles, limits occupancy to 2 people per bedroom plus 2 additional guests with maximum 10 people total, mandates quiet hours from 10 PM to 7 AM, requires adequate parking (typically 1 space per bedroom), and prohibits rentals for less than 30 consecutive days in some residential zones. The approval timeline is typically 4-6 weeks after submitting a complete application, during which the city conducts inspections for safety compliance, zoning verification, and neighborhood compatibility review. Once approved, you must display the permit number in all advertising and maintain compliance with ongoing requirements including annual renewals, guest registries, and adherence to noise and occupancy limits.

Short-term rentals (STRs) are legal in Lakewood, Colorado, but operate under specific regulations established by the city. As of 2023, Lakewood requires STR operators to obtain a business license and comply with zoning restrictions that generally limit short-term rentals to certain residential zones while prohibiting them in some neighborhoods. The city typically requires a minimum rental period of 30 days in many areas, effectively restricting traditional short-term rentals under 30 days in residential zones, though some commercial and mixed-use areas may allow shorter stays. Property owners must also comply with occupancy limits, parking requirements, and noise ordinances, and the city has implemented registration requirements and potential penalties for non-compliance. Recent changes have included stricter enforcement mechanisms and clearer definitions of what constitutes a short-term rental, with the city balancing tourism revenue against neighborhood preservation concerns.

The best Airbnb investment areas in Lakewood, Colorado include the Belmar district, which offers a vibrant downtown atmosphere with shopping, dining, and entertainment venues that attract both leisure travelers and business visitors to the Denver metro area. The neighborhoods near Bear Creek Lake Park and William Frederick Hayden Park on Green Mountain are highly desirable due to their proximity to outdoor recreation activities like hiking, biking, and water sports, appealing to adventure tourists year-round. Areas close to the Denver Federal Center attract significant business travel demand from government contractors and federal employees needing temporary housing. The historic Lakewood area near Colfax Avenue provides affordable investment opportunities while still offering easy access to downtown Denver via light rail, making it attractive to budget-conscious travelers and long-term visitors. Properties near the Colorado Mills shopping center benefit from retail tourism and families visiting the area's entertainment options, while neighborhoods adjacent to Red Rocks Amphitheatre capture the lucrative concert and event tourism market, with visitors seeking accommodations during the venue's busy summer season from companies like AEG Live and various touring acts.

In Lakewood, Colorado, Airbnb hosts are subject to multiple lodging taxes including the state sales tax of 2.9%, Jefferson County sales tax of approximately 1%, and Lakewood city sales tax of around 3.5%, totaling roughly 7.4% in combined sales taxes that apply to short-term rentals. Additionally, there is a Colorado state lodging tax of 2.9% and Jefferson County may impose a lodging tax of approximately 1-2%. Lakewood requires short-term rental operators to obtain a business license and collect applicable taxes from guests, with remittance typically required monthly or quarterly depending on volume through the Colorado Department of Revenue's online system for state taxes and directly to Jefferson County and Lakewood for local taxes. Hosts must register with each taxing jurisdiction, collect taxes at the time of booking or check-in, maintain detailed records, and file returns by the required deadlines. Airbnb may collect and remit some taxes automatically through their platform for certain jurisdictions, but hosts remain ultimately responsible for compliance. Exemptions are generally limited and may include stays exceeding 30 consecutive days which could be considered long-term rentals rather than short-term lodging, though hosts should verify current exemption criteria with each taxing authority as regulations frequently change.

Starting an Airbnb in Lakewood, Colorado requires approximately $520,000-$580,000 in total initial investment. Property purchase costs around $450,000 based on median home prices in Lakewood as of 2023. Furnishing a 2-3 bedroom property typically runs $15,000-$25,000 including furniture, appliances, linens, and décor to create an attractive rental space. Initial setup costs including professional photography, listing creation, and basic marketing materials total approximately $2,000-$3,000. Permits and fees in Jefferson County and Lakewood include business license ($100), short-term rental permit ($200-$400), and potential HOA approval fees totaling around $500-$800. Insurance for short-term rentals costs approximately $2,000-$3,500 annually, with many requiring specialized STR coverage. Utility setup and deposits for electricity, gas, water, internet, and cable run about $500-$800 initially. First six months of operating costs including utilities ($1,200), cleaning services ($2,400), property management software ($300), maintenance reserves ($2,000), and marketing ($1,000) total approximately $7,000-$8,000, bringing the complete startup investment to roughly $520,000-$580,000 depending on property size and furnishing quality.

Airbnb properties in Lakewood, Colorado typically generate annual revenues between $35,000-$65,000 for well-positioned units, with average daily rates ranging from $95-$180 depending on property size and amenities. Operating expenses generally consume 40-50% of gross revenue, including cleaning fees ($40-60 per turnover), property management (15-25% of revenue), utilities ($150-300 monthly), insurance ($1,200-2,000 annually), and maintenance costs averaging $2,000-4,000 yearly. Net profit margins typically range from 15-35% for successful properties, with higher-end homes near Bear Creek Lake Park or Belmar district achieving the upper range due to premium pricing and consistent 65-75% occupancy rates. Success factors include proximity to Denver (15-minute drive), competitive pricing against downtown Denver hotels, professional photography, rapid guest communication, and strategic amenities like hot tubs or mountain views. Properties within walking distance of Belmar's shopping and dining scene, such as renovated 3-bedroom homes priced around $140-160 nightly, often achieve $45,000-55,000 annual revenue with net profits of $18,000-22,000 after expenses, while budget-friendly 1-2 bedroom units averaging $100-120 nightly typically generate $28,000-38,000 gross revenue with $12,000-18,000 net profit, making Lakewood a moderately profitable market for investors willing to maintain high service standards and competitive positioning.

Airbnb investments in Lakewood, Colorado typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10% based on current market conditions. Properties near Bear Creek Lake Park and the Belmar district command premium nightly rates of $85-140, with average occupancy rates of 65-75% annually. Initial investment recovery and profitability generally occurs within 18-24 months for well-positioned properties, with gross rental yields averaging 9-11% before expenses. The proximity to Denver International Airport and downtown Denver, combined with outdoor recreation access, supports consistent demand from both business and leisure travelers, contributing to stable returns in the $300,000-500,000 property price range that dominates the Lakewood short-term rental market.

STRSearch is a leading national platform that helps investors identify profitable short-term rental properties in Lakewood, Colorado, offering market analysis and investment property recommendations. Local real estate agents specializing in Airbnb investments in Lakewood include Keller Williams Realty Downtown LLC agents who focus on investment properties, RE/MAX Alliance professionals with short-term rental expertise, and Coldwell Banker Realty agents experienced in the Denver metro vacation rental market. National services include Mashvisor, which provides Airbnb analytics and property search tools for the Lakewood area, AirDNA for market data and revenue projections, Awning for turnkey Airbnb property management and investment opportunities, Roofstock for single-family rental investments that can be converted to short-term rentals, and BiggerPockets for connecting with local investors and finding Airbnb-suitable properties. Local property management companies like RedAwning, Vacasa, and AvantStay also help investors identify and manage profitable short-term rental properties in Lakewood's market, which benefits from proximity to downtown Denver and outdoor recreation areas.