Is Monona, Wisconsin Good for Airbnb Investment?

To start an Airbnb in Monona, Wisconsin, begin by researching local regulations as Monona requires short-term rental operators to obtain a conditional use permit from the city's Plan Commission and comply with zoning ordinances that typically restrict rentals to owner-occupied properties or specific districts. Contact Monona City Hall at 5211 Schluter Road to understand current ordinances, as requirements may include safety inspections, parking provisions, and neighbor notification processes. Find a suitable property by working with local real estate agents familiar with Monona's neighborhoods near Lake Monona or downtown areas, ensuring the property meets zoning requirements and has adequate parking since most regulations require one space per bedroom. Apply for necessary permits including the conditional use permit ($200-400 estimated fee), business license, and ensure compliance with Wisconsin Department of Safety and Professional Services safety codes, plus obtain proper insurance coverage for short-term rentals. Furnish the property with quality furniture, linens, kitchen essentials, and local touches highlighting Monona's lake community atmosphere, ensuring Wi-Fi, smart locks, and safety equipment like smoke detectors and fire extinguishers meet code requirements. Create your Airbnb listing with professional photos showcasing proximity to Lake Monona, nearby Madison attractions, and local amenities, setting competitive rates based on comparable properties in the Madison metro area ($80-150/night estimated). Manage the property by establishing cleaning protocols between guests, maintaining responsive communication, coordinating with local cleaning services, and staying compliant with Monona's ongoing reporting requirements and any occupancy taxes that may apply at the county or state level.

To identify profitable short-term rental properties in Monona, Wisconsin, focus on waterfront locations near Lake Mendota and Lake Waubesa, as well as properties within walking distance of downtown Madison (approximately 6 miles away) since Monona serves as a quieter alternative for visitors seeking lake access while maintaining proximity to the state capital. Target 2-4 bedroom single-family homes or condos built after 1980 with modern amenities, lake views, outdoor spaces, and parking, as these features command premium rates of $150-300 per night during peak summer months. Analyze comparable properties using AirDNA and Mashvisor to assess occupancy rates (typically 60-75% in this market) and average daily rates, while monitoring seasonal fluctuations driven by University of Wisconsin events, summer lake activities, and state government business travel. Research competition by examining existing Airbnb and VRBO listings within a 2-mile radius, identifying gaps in amenities or pricing strategies, and consider properties near Winnequah Park, the Community Center, or with boat launch access as these locations typically outperform. Utilize STR-specific tools like Rabbu and AllTheRooms for market analysis, consult local property management companies like Vacasa or RedAwning for operational insights, and verify Monona's short-term rental regulations and licensing requirements through the city's planning department, as Wisconsin municipalities have varying STR policies that directly impact profitability potential.

To obtain an Airbnb/STR permit in Monona, Wisconsin, you must first contact the Monona Community Development Department at City Hall located at 5211 Schluter Road to determine current short-term rental regulations, as requirements may have been updated since 2023. Generally, you'll need to submit a short-term rental license 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 unit, contact information for a local responsible party available 24/7, and completed safety inspection checklist. The application fee typically ranges from $100-300 annually, with additional inspection fees of approximately $50-100. You must ensure the property complies with zoning requirements (many residential areas restrict STRs), obtain necessary permits for any modifications, install smoke and carbon monoxide detectors in all required locations, provide adequate parking spaces, and maintain occupancy limits based on bedroom count. The approval process usually takes 30-60 days from submission of complete application, including time for city staff review, potential site inspection, and any required public notice period. Once approved, you'll receive your permit which must be renewed annually, and you'll need to comply with ongoing requirements such as maintaining guest registries, collecting applicable taxes, and responding promptly to any neighbor complaints or city inquiries.

Short-term rentals (STRs) in Monona, Wisconsin are generally prohibited in residential zoning districts under the city's current ordinances as of 2023. The city has maintained restrictive policies toward STRs, particularly in single-family residential areas, citing concerns about neighborhood character, parking, and noise impacts. STRs may be permitted in certain commercial or mixed-use zoning districts with proper licensing and compliance with safety requirements, but the majority of residential properties cannot legally operate as short-term rentals. Monona has not experienced the same level of STR liberalization seen in other Wisconsin communities, and recent discussions by the city council have focused on maintaining these restrictions rather than expanding STR permissions. Property owners considering STR operations must obtain proper zoning verification and business licenses, with violations subject to fines and enforcement action by the city's code enforcement department.

The most promising Airbnb investment areas in Monona, Wisconsin include the Winnequah neighborhood near Lake Monona's shoreline, which attracts visitors seeking waterfront recreation, fishing, and scenic views year-round. The downtown Monona area around Monona Drive offers proximity to local restaurants, shops, and easy access to Madison's attractions just minutes away, making it ideal for business travelers and tourists exploring the greater Madison area. The Frost Woods and Maywood neighborhoods provide quiet residential settings that appeal to families visiting the University of Wisconsin-Madison or attending events at nearby venues, while still offering quick access to Lake Monona activities. Properties near Winnequah Park and Beach are particularly attractive due to the swimming beach, boat launches, and summer events that draw both locals and visitors. The areas close to the Monona Community Center and library attract guests attending local events, youth sports tournaments, and community gatherings, while the proximity to major employers in Madison makes these locations suitable for extended business stays and corporate housing needs.

Airbnb properties in Monona, Wisconsin are subject to Wisconsin state sales tax of 5% and room tax of 5%, totaling 10% on lodging stays. Dane County imposes an additional 6% room tax, bringing the combined rate to approximately 16%. The City of Monona may impose its own local room tax of up to 8%, though the specific rate varies and could bring total taxes to around 18-20%. These taxes are typically collected by Airbnb directly from guests at the time of booking through their automatic tax collection system, which began around 2018-2019 for Wisconsin. Airbnb remits these taxes directly to the Wisconsin Department of Revenue and applicable local jurisdictions on behalf of hosts. Hosts must still register with the Wisconsin Department of Revenue and obtain necessary permits, though they may not need to manually collect taxes if using Airbnb's system. Exemptions may apply for stays exceeding 30 consecutive days, which are generally considered long-term rentals rather than transient lodging, and certain government or non-profit organization bookings may qualify for exemptions with proper documentation.

Starting an Airbnb in Monona, Wisconsin requires approximately $350,000-$400,000 in total initial investment. Property purchase costs around $320,000 based on median home prices in the area as of 2023-2024. Furnishing a 2-3 bedroom property typically runs $15,000-$25,000 including furniture, appliances, linens, and decor to create an attractive rental space. Initial setup costs including professional photography, listing creation, and basic marketing materials add another $1,500-$2,500. Permits and fees in Monona include short-term rental licensing ($200-$500), business registration ($50-$100), and potential zoning compliance costs ($500-$1,000). Insurance premiums for short-term rental coverage average $2,000-$3,000 annually, with the first year paid upfront. Utility deposits and connections for electricity, gas, water, internet, and cable total approximately $1,000-$1,500. First six months of operating costs including utilities ($200/month), cleaning services ($100-$150 per turnover), supplies and maintenance ($150/month), platform fees (3% of bookings), and property management software ($50/month) amount to roughly $3,000-$5,000, assuming moderate occupancy rates during the initial period.

Airbnb properties in Monona, Wisconsin typically generate annual revenues between $15,000-$35,000 for whole-home listings, with average daily rates ranging from $85-$150 depending on property size and lakefront proximity. 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 ($800-1,500 annually), and maintenance costs averaging $2,000-4,000 yearly. Properties near Lake Mendota command premium rates, with some lakefront homes achieving 70-80% occupancy rates during peak summer months (May-September) and profit margins of 25-35%. Success factors include professional photography, responsive host communication, proximity to University of Wisconsin-Madison (driving demand from visiting families), and seasonal pricing strategies that capitalize on summer lake activities and fall football weekends. A typical 3-bedroom home in Monona might gross $28,000 annually with $17,000 in expenses, yielding approximately $11,000 net profit (39% margin), though properties requiring significant upfront renovations or those in less desirable locations often see profit margins below 20%. Winter months typically see 30-40% occupancy drops, making year-round profitability dependent on strong summer performance and effective cost management.

Airbnb investments in Monona, Wisconsin typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10%, based on average property acquisition costs of $250,000-$350,000 and nightly rates of $85-$120 during peak seasons. Properties generally reach profitability within 18-24 months, with occupancy rates averaging 65-75% annually due to Monona's proximity to Madison and Lake Mendota attractions. The market benefits from consistent demand from University of Wisconsin visitors, business travelers, and recreational tourists, with seasonal variations showing stronger performance from May through October generating 15-20% higher returns, while winter months typically see 20-30% lower occupancy but maintain steady weekend bookings from ice fishing and winter sports enthusiasts.

STRSearch is a national platform that helps investors identify profitable short-term rental properties across markets including Monona, Wisconsin. In the Madison metropolitan area, which includes Monona, investors can work with local real estate agents like those at Realty Executives Cooper Spransy, Coldwell Banker Success, and RE/MAX Preferred who have experience with investment properties and short-term rental regulations. National services like Awning, RedAwning, and Mashvisor provide market analysis and property identification tools for Airbnb investments in Wisconsin markets. Local property management companies such as Host Milwaukee (which serves the broader Wisconsin market) and Madison-area vacation rental managers can assist with both acquisition advice and ongoing management. AirDNA and Rabbu offer market data and analytics specifically for short-term rental investments, while companies like Roofstock and Arrived Homes occasionally feature Wisconsin investment properties. Local real estate investment groups and meetups in the Madison area, along with agents specializing in lake properties given Monona's location on Lake Monona, can provide valuable insights into the most profitable areas for Airbnb investments in this Wisconsin community.