Is Lawrence, Kansas Good for Airbnb Investment?

To start an Airbnb in Lawrence, Kansas, begin by researching local zoning laws and regulations through the City of Lawrence Planning Department, as Lawrence requires short-term rental operators to obtain a Conditional Use Permit (CUP) for properties in residential zones and comply with specific occupancy limits typically capped at 2 unrelated adults plus children. Contact the Lawrence-Douglas County Building Codes office to ensure your property meets safety requirements including smoke detectors, carbon monoxide detectors, and proper egress windows. Obtain necessary permits including the CUP ($400-600 application fee), business license from the City Clerk's office ($25-50), and register for Kansas sales tax with the Department of Revenue since you'll need to collect and remit state and local taxes (currently 9.3% combined rate in Lawrence). Find a suitable property considering proximity to the University of Kansas campus, downtown Lawrence, or near major attractions like Massachusetts Street, ensuring the property allows short-term rentals per HOA or lease agreements. Furnish the space with quality basics including comfortable bedding, kitchen essentials, WiFi, TV, and local guidebooks, budgeting $3,000-8,000 for initial furnishing depending on property size. Create your Airbnb listing with professional photos, competitive pricing ($60-150/night depending on size and location), and highlight proximity to KU, downtown attractions, and local amenities. For ongoing management, establish cleaning protocols between guests ($50-100 per turnover), maintain 24/7 communication availability, stock supplies regularly, and ensure compliance with Lawrence's noise ordinances and parking requirements, while keeping detailed records for tax purposes and annual CUP renewal requirements.

To identify profitable short-term rental properties in Lawrence, Kansas, focus on locations within 1-2 miles of the University of Kansas campus, downtown Massachusetts Street, and near major event venues like Allen Fieldhouse and David Booth Kansas Memorial Stadium, as these areas generate consistent demand from visiting families, prospective students, and sports fans. Target 2-4 bedroom properties built after 1980 with modern amenities, parking, and outdoor spaces, as Lawrence's rental market favors homes that can accommodate groups visiting for university events and graduations. Conduct pricing analysis using AirDNA and Mashvisor to benchmark against comparable properties, aiming for properties that can generate $150-250 per night during peak university seasons (football games, graduation, move-in periods) and $80-120 during off-peak times. Research competition by analyzing existing Airbnb and VRBO listings within a 3-mile radius of campus, noting occupancy rates, pricing strategies, and guest reviews to identify market gaps. Utilize tools like Rabbu, BiggerPockets calculators, and local MLS data through Realtor.com, while connecting with Lawrence-based property management companies like Sunflower Property Management and consulting the Lawrence Association of Realtors for market insights, ensuring compliance with Lawrence's short-term rental ordinances which require registration and limit rentals in certain residential zones.

To obtain an Airbnb/STR permit in Lawrence, Kansas, you must first contact the City of Lawrence Planning and Development Services Department at City Hall located at 6 East 6th Street to apply for a Short-Term Rental License. Required documents typically include a completed application form, proof of property ownership or lease agreement, floor plan of the rental unit, proof of liability insurance (minimum $1 million coverage), contact information for a local responsible party within 30 miles if you're not local, and a site plan showing parking availability. The application fee is approximately $100-150 with an annual renewal fee of around $75-100. You must also obtain a business license from the City Clerk's office for an additional $25-50 fee. The property must comply with Lawrence's specific requirements including maximum occupancy limits (typically 2 people per bedroom plus 2 additional), adequate parking (usually 1 space per bedroom), proper smoke and carbon monoxide detectors, and compliance with residential zoning regulations. The approval timeline is generally 30-45 days from submission of a complete application, during which time the city may conduct an inspection to ensure compliance with safety and zoning requirements. Once approved, you must display the permit number in all online listings and maintain compliance with ongoing requirements including guest registration logs and noise ordinance adherence.

Short-term rentals (STRs) are legal in Lawrence, Kansas, but operate under specific regulations established by the city. Lawrence requires STR operators to obtain a business license and comply with zoning restrictions that generally limit short-term rentals to certain residential districts while prohibiting them in some neighborhoods. The city has implemented occupancy limits, parking requirements, and noise ordinances that STR operators must follow. Properties must meet safety standards including smoke detectors and emergency egress requirements. Lawrence has been actively updating its STR regulations in recent years, with the city council making adjustments around 2020-2022 to balance neighborhood concerns with property owner rights. The regulations include provisions for complaint procedures and potential license revocation for non-compliant operators. Some areas near the University of Kansas campus have additional restrictions due to concerns about impacts on long-term housing availability for students and residents.

The best Airbnb investment areas in Lawrence, Kansas include the Downtown/Massachusetts Street district, which attracts visitors to the University of Kansas campus, historic attractions, and vibrant nightlife scene with consistent demand from parents visiting students, prospective families, and business travelers. The Oread neighborhood near KU campus offers strong rental potential due to football games at Memorial Stadium, basketball events at Allen Fieldhouse, and academic conferences that draw thousands annually. The East Lawrence Arts District has emerged as a trendy area with galleries, breweries, and cultural events that appeal to weekend tourists and creative professionals. The Historic Old West Lawrence neighborhood provides charm for visitors interested in Civil War history and heritage tourism, while areas near Clinton Lake attract outdoor enthusiasts and weekend recreational visitors seeking vacation rentals for fishing, boating, and camping activities.

In Lawrence, Kansas, Airbnb properties are subject to both state and local lodging taxes. The Kansas state transient guest tax is 6.5% on gross rental receipts for stays under 28 days, while Douglas County imposes an additional 2% transient guest tax, bringing the total lodging tax rate to approximately 8.5%. The City of Lawrence also requires a business license for short-term rental operators. These taxes are typically collected by Airbnb directly from guests at the time of booking through their automated tax collection system, which began in Kansas around 2018, and Airbnb remits these funds quarterly to the Kansas Department of Revenue and Douglas County. Property owners may still need to register with local tax authorities and file periodic returns even when Airbnb collects taxes. Exemptions generally apply to stays of 28 days or longer, which are considered long-term rentals rather than transient accommodations, and certain government or charitable organization bookings may also be exempt from these lodging taxes.

The total cost to start an Airbnb in Lawrence, Kansas would be approximately $185,000-$220,000. Property purchase represents the largest expense at $150,000-$180,000 based on median home prices in Lawrence as of 2023-2024. Furnishing costs typically range $8,000-$12,000 for a complete 2-3 bedroom property including furniture, bedding, kitchen essentials, and decor from retailers like IKEA, Wayfair, and local stores. Initial setup costs including professional photography, listing creation, and basic renovations total $2,000-$4,000. Permits and fees in Douglas County include business license ($50-$100), short-term rental permit ($200-$500), and potential zoning compliance costs ($500-$1,500). Insurance for short-term rentals runs $1,200-$2,400 annually, with companies like Proper Insurance and CBIZ offering specialized coverage. Utility setup and deposits for electricity (Evergy), gas, water, internet, and cable total $800-$1,200. First six months operating costs including utilities ($600/month), cleaning services ($100-$150 per turnover), supplies and maintenance ($200/month), platform fees to Airbnb and VRBO (3% of bookings), and marketing expenses total approximately $4,500-$7,000, assuming 60-70% occupancy rates typical for Lawrence's market driven by University of Kansas visitors and business travelers.

Airbnb properties in Lawrence, Kansas typically generate annual revenues of $15,000-$35,000 for entire homes and $8,000-$18,000 for private rooms, with occupancy rates averaging 45-65% due to the University of Kansas student population and visiting families. Operating expenses including cleaning fees ($40-60 per turnover), utilities ($150-250 monthly), property management (15-25% of revenue), insurance ($800-1,200 annually), and maintenance costs typically consume 40-55% of gross revenue. Properties near KU campus, particularly 3-4 bedroom homes in the Oread neighborhood, achieve the highest profit margins of 25-35%, while downtown properties near Massachusetts Street average 20-28% margins. Success factors include targeting game day weekends when rates can reach $200-400 per night compared to typical $80-120, maintaining high cleanliness standards for student guests, and offering amenities like parking and fast WiFi. A case study of a 3-bedroom home near campus showed $28,000 annual revenue with $17,500 in expenses, yielding a 37% profit margin, while a downtown 2-bedroom apartment generated $22,000 revenue with $14,000 expenses for a 36% margin, demonstrating that well-positioned Lawrence properties can achieve strong profitability despite the smaller market size compared to major metropolitan areas.

Based on Lawrence, Kansas market conditions, Airbnb investments typically generate annual ROI of 12-18% with cash-on-cash returns ranging from 8-15% depending on property type and location proximity to the University of Kansas campus. Properties within 2-3 miles of KU campus command premium rates of $80-120 per night during peak periods (football season, graduation, move-in weeks) and $50-75 during regular academic periods, while properties further from campus average $45-65 nightly. Initial investment recovery typically occurs within 6-8 years for well-positioned properties, with monthly gross revenues of $1,800-3,200 for 2-3 bedroom homes after accounting for 65-75% average occupancy rates. Properties targeting student groups and visiting families show strongest performance, with break-even on operating expenses typically achieved within 18-24 months, though seasonal fluctuations during summer months (May-August) can reduce occupancy to 40-50% and require strategic pricing adjustments to maintain profitability targets.

STRSearch is a national platform that helps investors identify profitable short-term rental properties across markets including Lawrence, Kansas. In Lawrence, local real estate agents like those at Realty Executives of Lawrence and Coldwell Banker Griffith & Blair have experience with investment properties and can assist with Airbnb acquisitions. National services include AirDNA for market analysis, Mashvisor for property analytics, and BiggerPockets for investor networking and deal sourcing. Local property management companies such as Lawrence Property Management and Sunflower Property Management can provide insights into rental markets and may assist with investment property identification. Additional national platforms like Roofstock, which specializes in investment properties, and RedfinNow occasionally serve the Lawrence market. Local mortgage brokers and investment-focused lenders like First National Bank of Lawrence understand the unique financing needs of short-term rental investors. Real estate investment groups and meetups in the Kansas City metro area, which includes Lawrence, often provide networking opportunities and deal flow for Airbnb investors looking in the college town market.