Is Millwood, Washington Good for Airbnb Investment?

To start an Airbnb in Millwood, Washington, begin by researching Spokane County's short-term rental regulations since Millwood is an unincorporated area, which typically requires a business license and may have zoning restrictions for residential properties used commercially. Contact Spokane County Planning Department to obtain necessary permits, including a conditional use permit if required, and ensure compliance with fire safety codes and health department regulations. Find a suitable property by purchasing or leasing a home in residential zones that allow short-term rentals, focusing on areas near Spokane River or downtown Spokane for tourist appeal. Furnish the property with quality furniture, linens, kitchen essentials, WiFi, and safety equipment like smoke detectors and fire extinguishers, ensuring it meets Washington State's habitability standards. Create your Airbnb listing with professional photos, competitive pricing (estimated $80-150/night for Millwood area), and detailed descriptions highlighting proximity to Spokane attractions and outdoor activities. Manage your property by establishing check-in procedures, cleaning protocols between guests, maintaining responsive communication, collecting and remitting Washington State sales tax (currently 6.5% plus local taxes), and potentially hiring local cleaning services or property management companies if needed for remote management.

To identify profitable short-term rental properties in Millwood, Washington, focus on properties within 2-3 miles of Spokane River recreational areas and Liberty Lake, as these locations attract outdoor enthusiasts year-round. Target 2-4 bedroom single-family homes or cabins built after 1990 with modern amenities, outdoor spaces, hot tubs, and parking for multiple vehicles, as these features command premium rates of $150-300 per night in the area. Analyze pricing by researching comparable STRs on Airbnb and VRBO within a 5-mile radius, noting that properties near Spokane Country Club and golf courses typically achieve 65-75% occupancy rates with average daily rates 20-30% higher than standard residential areas. Competition research should focus on the 15-25 existing STRs in Millwood and neighboring Liberty Lake, identifying gaps in luxury amenities or unique property types like waterfront access or mountain views. Utilize AirDNA and Mashvisor for market analysis, Spokane County's permit database for regulatory compliance, and local real estate platforms like Windermere and Keller Williams Spokane for property acquisition, while monitoring seasonal demand patterns that peak during summer months (June-August) and winter recreation periods when nearby ski areas drive occupancy rates above 80%.

To obtain an Airbnb/STR permit in Millwood, Washington, you must first contact the Spokane County Planning Department since Millwood is an unincorporated area, and submit a Conditional Use Permit application which typically costs around $1,500-2,000. Required documents include a completed CUP application form, site plan showing the property layout, parking plan demonstrating adequate guest parking, septic system approval if applicable, fire safety inspection certificate, and proof of liability insurance with minimum $1 million coverage. You'll also need to provide a management plan detailing how the property will be operated, including noise control measures, maximum occupancy limits (typically 2 people per bedroom plus 2 additional), and 24/7 contact information for complaints. The application process involves a public hearing before the Hearing Examiner, with notification to neighboring properties within 300 feet, and the entire timeline typically takes 3-4 months from submission to approval. Additional Millwood-specific requirements include compliance with residential zoning standards, maintaining the property's residential character, providing one parking space per bedroom plus one additional space, and ensuring all structures meet current building codes with proper egress windows in sleeping areas.

Short-term rentals (STRs) in Millwood, Washington are generally legal but subject to Spokane County regulations since Millwood is an unincorporated community. As of 2023, Spokane County allows STRs in residential zones with specific requirements including business license registration, occupancy limits typically capped at 10 guests, parking requirements of one space per bedroom plus two additional spaces, and compliance with noise ordinances. Properties must meet safety standards including smoke and carbon monoxide detectors, and hosts must provide emergency contact information to neighbors. The county implemented stricter enforcement measures in 2022 following neighbor complaints about noise and parking issues. STRs are prohibited in areas zoned exclusively for long-term residential use, and some homeowners associations may have additional restrictions. Recent changes include mandatory registration renewal every two years and increased penalties for violations, with the county conducting more frequent compliance inspections since late 2022.

The best areas for Airbnb investment in Millwood, Washington include the downtown core near Millwood Avenue and Argonne Road, which attracts business travelers visiting nearby Spokane Valley industrial complexes and offers convenient access to Interstate 90. The residential neighborhoods south of the Spokane River provide scenic waterfront properties that appeal to leisure travelers seeking peaceful retreats while remaining close to Spokane's attractions. Areas near Millwood Park and the Centennial Trail are particularly attractive for outdoor enthusiasts and families visiting for recreational activities. The neighborhoods adjacent to University High School and near the Spokane Valley Mall corridor benefit from visiting families, sports teams, and shoppers who prefer quieter accommodations outside busy Spokane proper. Properties within walking distance of local restaurants along Argonne Road capture both business and leisure travelers, while homes near the Spokane River offer unique selling points with water access and natural beauty that command premium rates from guests seeking distinctive Pacific Northwest experiences.

Airbnb properties in Millwood, Washington are subject to Washington State's lodging tax of 0.2% and sales tax of 6.5%, which are automatically collected by Airbnb and remitted to the state on behalf of hosts. Additionally, Spokane County imposes a lodging tax of approximately 2-3% on short-term rentals, which hosts must typically collect from guests and remit quarterly to the county treasurer's office. The City of Millwood may impose its own local lodging or business taxes ranging from 1-2%, requiring hosts to register for a business license and file monthly or quarterly returns. Hosts are generally required to maintain detailed records of all bookings and tax collections, with exemptions potentially available for stays exceeding 30 consecutive days or rentals to government employees on official business. Collection occurs at the time of booking, and hosts must ensure compliance with all applicable jurisdictions including state, county, and municipal requirements, with penalties for late filing or non-compliance typically ranging from 5-25% of unpaid taxes plus interest.

To start an Airbnb in Millwood, Washington, the total initial costs would be approximately $485,000-$520,000. Property purchase represents the largest expense at $400,000-$425,000 based on median home prices in the Spokane Valley area where Millwood is located. Furnishing costs typically range $15,000-$25,000 for a complete 2-3 bedroom home including furniture, bedding, kitchenware, and décor to create an attractive rental space. Initial setup costs including professional photography, listing creation, welcome materials, and basic supplies total around $2,000-$3,000. Permits and fees vary but generally include business license ($100-$200), short-term rental permit ($200-$500), and potential HOA approval fees totaling $500-$1,000. Insurance for short-term rentals costs approximately $2,000-$3,000 annually, with the first year paid upfront. Utilities including electricity, gas, water, internet, and cable average $300-$400 monthly or $1,800-$2,400 for six months. First six months operating costs encompass cleaning services ($150 per turnover), maintenance reserves ($200 monthly), platform fees (3% of bookings estimated at $300 monthly), supplies replenishment ($100 monthly), and marketing expenses ($200 monthly), totaling approximately $5,700-$7,200 for the initial six-month period.

Based on market analysis, Airbnb properties in Millwood, Washington typically generate annual revenues between $18,000-$35,000 for entire home listings, with average daily rates ranging from $85-$150 depending on property size and amenities. Operating expenses generally consume 40-60% of gross revenue, including cleaning fees ($30-50 per turnover), property management (10-20% of revenue), utilities ($150-300 monthly), insurance ($1,200-2,000 annually), and maintenance costs ($2,000-4,000 yearly). Net profit margins typically range from 15-35% for well-managed properties, with successful hosts achieving higher margins through strategic pricing, excellent guest experiences, and efficient operations. Success factors in this suburban Spokane area include proximity to outdoor recreation areas like Mount Spokane State Park, competitive pricing against nearby hotels, professional photography, responsive communication, and maintaining high cleanliness standards. Properties with unique features such as hot tubs, game rooms, or scenic views command premium rates, while those targeting business travelers benefit from Millwood's location near Spokane's industrial areas. The market shows seasonal fluctuations with peak demand during summer months (June-August) and winter ski season, requiring hosts to adjust pricing strategies accordingly to maximize annual profitability.

Airbnb investments in Millwood, Washington typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10%, based on average property acquisition costs of $400,000-$600,000 and nightly rates of $120-$180 during peak seasons. Properties in this suburban Spokane area generally achieve profitability within 18-24 months, with occupancy rates averaging 65-75% annually due to proximity to outdoor recreation areas like Liberty Lake and seasonal demand from business travelers visiting nearby tech companies and medical facilities. The market benefits from lower property taxes compared to Seattle metro areas and steady rental demand from visitors to Spokane Valley attractions, though winter months typically see 20-30% lower occupancy rates, requiring investors to maintain 3-4 months of operating expenses in reserves to achieve sustainable returns.

STRSearch is a leading national platform that specializes in identifying profitable short-term rental properties for Airbnb investors, offering comprehensive market analysis and property recommendations in Millwood, Washington. Local real estate agents serving the Millwood area include Windermere Real Estate and John L. Scott Real Estate, both with agents experienced in investment properties and short-term rental markets. Keller Williams Spokane has several agents who focus on Airbnb investment properties in the greater Spokane Valley region, including Millwood. National services like Mashvisor provide data-driven property analysis and investment recommendations for the Millwood market, while AirDNA offers short-term rental market insights and performance data. RedAwning and Vacasa provide property management services for Airbnb investors in the area, and companies like BiggerPockets connect investors with local professionals. Real estate investment firms such as Roofstock and Arrived Homes occasionally feature properties in the Spokane Valley area, and local property management companies like Spokane Property Management Group offer services tailored to short-term rental investors looking to maximize their returns in Millwood's growing vacation rental market.