Is Medford, Massachusetts Good for Airbnb Investment?

To start an Airbnb in Medford, Massachusetts, begin by researching local regulations as Medford requires short-term rental operators to obtain a business license and comply with zoning ordinances that may restrict rentals in certain residential areas. Contact the Medford City Clerk's office to obtain the necessary business license (approximately $50-100 annually) and check with the Building Department for any required inspections or permits, particularly for properties built before 1978 due to lead paint regulations. Find a suitable property by purchasing or securing landlord permission if renting, ensuring it meets Massachusetts state fire safety codes including smoke and carbon monoxide detectors. Register with the Massachusetts Department of Revenue for tax collection purposes and obtain liability insurance coverage of at least $1 million. Furnish the space with quality basics including comfortable bedding, kitchen essentials, WiFi, and safety equipment while ensuring ADA compliance where applicable. Create your Airbnb listing with professional photos, competitive pricing (Medford averages $80-150/night as of 2023), and detailed descriptions highlighting proximity to Boston (7 miles) and local attractions like the Mystic River. Manage bookings through Airbnb's platform or property management software, maintain cleanliness standards, collect and remit the 14.45% Massachusetts state and local taxes, and respond promptly to guest communications while keeping detailed records for tax purposes and potential city inspections.

To identify profitable STR properties in Medford, Massachusetts, focus on locations within walking distance of Tufts University, near the Orange Line T stations (Wellington or Malden Center), and in historic neighborhoods like Hillside or South Medford that offer easy access to Boston while maintaining suburban charm. Target 2-4 bedroom single-family homes or condos built after 1950 with parking, updated kitchens, reliable WiFi capability, and outdoor space, as these features command premium rates from business travelers and families visiting the university. Conduct pricing analysis using AirDNA and Mashvisor to benchmark against comparable properties, aiming for average daily rates of $120-180 depending on size and amenities, while analyzing seasonal demand patterns driven by Tufts academic calendar and Boston tourism peaks. Research competition by monitoring active Airbnb and VRBO listings within a 1-mile radius, identifying gaps in amenities or pricing, and studying occupancy rates of similar properties through tools like AllTheRooms and Transparent. Utilize Medford-specific resources including the city's zoning maps to ensure STR compliance, connect with local property management companies like Awning or RedAwning for market insights, monitor Medford real estate trends through MLS data, and leverage proximity analytics tools to measure walking distances to key attractions like Assembly Row, Mystic River paths, and public transportation hubs that drive guest demand.

To obtain an Airbnb/STR permit in Medford, Massachusetts, you must first contact the Medford City Clerk's Office at City Hall located at 85 George P. Hassett Drive to apply for a Short-Term Rental License, which requires submitting a completed application form along with a copy of your property deed or lease agreement, proof of liability insurance (minimum $1 million coverage), a floor plan of the rental unit, contact information for a local representative if you're not residing on-site, and payment of the application fee (approximately $200-300 annually). You'll also need to obtain a Certificate of Occupancy from the Building Department and may require a fire safety inspection depending on the property type. The application must include verification that the property complies with zoning regulations, as Medford restricts STRs to owner-occupied properties in most residential zones with a maximum of 30 days rental per year unless it's your primary residence. The review process typically takes 4-6 weeks, and you must also register with the Massachusetts Department of Revenue for state tax purposes and obtain a Massachusetts Vendor's License. Once approved, you'll receive your STR permit which must be renewed annually, and you're required to maintain guest registries, post emergency contact information, and ensure compliance with noise ordinances and parking restrictions specific to your neighborhood zoning district.

Short-term rentals (STRs) are legal in Medford, Massachusetts, but operate under the state's comprehensive STR regulations that took effect in 2019. Property owners must register with both the state and obtain local permits from Medford, pay state and local taxes including the 5.7% state excise tax, and comply with safety requirements including smoke and carbon monoxide detectors. Medford requires STR operators to obtain a business license and may impose additional local restrictions on the number of rental days per year, occupancy limits, and noise ordinances. The city has the authority to establish its own zoning restrictions and may prohibit STRs in certain residential areas or require special permits in specific zones. Recent changes include stricter enforcement of registration requirements and increased penalties for non-compliance, with the state maintaining a public registry of all legal STR properties. Property owners must also carry adequate insurance and may face restrictions on the total number of guests and parking requirements specific to Medford's local ordinances.

The best areas for Airbnb investment in Medford, Massachusetts include the Hillside neighborhood near Tufts University, which attracts visiting parents, prospective students, and academic conference attendees year-round, and the Wellington area close to the Orange Line MBTA station, offering excellent access to downtown Boston for business travelers and tourists who prefer staying outside the expensive city center. The Mystic Valley Parkway corridor is attractive due to its proximity to the Mystic River recreation areas and easy highway access, appealing to families visiting the region's historical sites like the nearby Bunker Hill Monument and USS Constitution. South Medford near the Somerville border benefits from overflow demand from Cambridge and Somerville's saturated short-term rental market, particularly during Harvard and MIT events, while still offering more affordable rates than those premium locations. The area around Medford Square provides a authentic suburban New England experience for visitors attending events at nearby venues like the Chevalier Theatre in Medford or accessing the broader Boston metropolitan area's attractions, with the added benefit of local restaurants and shops within walking distance.

In Medford, Massachusetts, Airbnb hosts are subject to both state and local lodging taxes. The Massachusetts state room occupancy excise tax is 5.7% on all short-term rental stays, which applies to rentals of 90 days or less. Additionally, Medford imposes a local room occupancy tax of 6% on short-term rentals. These taxes are typically collected by Airbnb directly from guests at the time of booking and remitted to the appropriate tax authorities on behalf of hosts, though hosts should verify their registration status with both the Massachusetts Department of Revenue and the City of Medford. Hosts must register with the state and obtain a room occupancy tax registration number, and may also need to register locally with Medford's tax collector. The state tax is remitted monthly to the Massachusetts Department of Revenue, while the local tax is remitted to the City of Medford according to their specified schedule. Exemptions may apply for stays exceeding 90 consecutive days, certain medical-related stays, or accommodations provided to homeless individuals, though specific exemption criteria should be verified with current regulations as tax laws can change.

The total cost to start an Airbnb in Medford, Massachusetts is approximately $650,000-$750,000. Property purchase represents the largest expense at $600,000-$650,000 based on median home prices in the area. Furnishing costs typically range $15,000-$25,000 for a complete 2-3 bedroom property including furniture, bedding, kitchenware, and electronics. 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-$500), business license ($50-$100), and potential local permits ($100-$300). Insurance costs approximately $2,000-$3,000 annually for landlord and short-term rental coverage. Monthly utilities including electricity, gas, water, internet, and cable average $300-$400 per month. First six months operating costs including utilities ($1,800-$2,400), cleaning services ($1,200-$2,000), supplies and maintenance ($800-$1,200), platform fees to Airbnb and VRBO ($500-$1,000), and marketing expenses ($300-$500) total approximately $4,600-$7,100.

Airbnb properties in Medford, Massachusetts typically generate annual revenues between $18,000-$35,000 for entire home listings, with average daily rates ranging from $85-$140 depending on property size and proximity to Boston (just 5 miles away). Operating expenses generally consume 40-60% of gross revenue, including cleaning fees ($50-80 per turnover), utilities ($150-250/month), property management (10-20% of revenue), insurance ($800-1,500 annually), and maintenance costs ($2,000-4,000 yearly). Net profit margins typically range from 15-35% for well-managed properties, with higher-end homes near Tufts University and the Mystic River commanding premium rates during peak seasons and university events. Success factors include strategic pricing during Boston Marathon week and graduation seasons, maintaining 4.8+ star ratings, offering parking (crucial in this area), and leveraging Medford's appeal as a quieter alternative to downtown Boston while remaining accessible via the Orange Line extension. Properties within walking distance of Medford Square or near the planned Green Line extension sites show stronger booking rates and can achieve occupancy levels of 65-80% annually, while those requiring car access typically see 45-60% occupancy, making location the primary determinant of profitability in this market.

Airbnb investments in Medford, Massachusetts typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10% based on current market conditions. Properties near Tufts University and downtown Boston access points command premium rates of $120-180 per night, with average occupancy rates of 65-75% annually. Initial investment recovery and profitability typically occurs within 18-24 months for well-positioned properties, considering Medford's median home prices of $650,000-750,000 and average renovation costs of $25,000-40,000 for Airbnb conversion. The proximity to Boston's employment centers and Logan Airport drives consistent demand, with seasonal peaks during university events and summer months boosting returns by 15-20% above baseline projections.

STRSearch is a national platform that specializes in identifying profitable short-term rental properties for investors looking in Medford, Massachusetts. Local real estate agents like those at Coldwell Banker Realty, RE/MAX Destiny, and Keller Williams Realty in the greater Boston area have experience with investment properties and Airbnb regulations in Medford. National services include Mashvisor, which provides Airbnb analytics and property search tools, AirDNA for market data and investment analysis, and Roofstock which focuses on investment properties that can be converted to short-term rentals. Local property management companies such as RedAwning, AvantStay, and Vacasa can help investors identify and manage profitable Airbnb properties in the Medford market. Additionally, investment-focused real estate agents at Compass, Century 21, and local boutique firms like Boston City Properties often work with clients specifically seeking Airbnb investment opportunities in the Boston metropolitan area including Medford.