Is Narragansett, Rhode Island Good for Airbnb Investment?

Potentially. Narragansett, Rhode Island combines visitor demand with long-term real estate upside.

• Presents a promising opportunity, largely driven by its strong appeal as a coastal tourist destination.
• The current market conditions reflect consistent demand for short-term rentals, particularly during peak seasons, fueled by Narragansett's beautiful beaches, popular attractions like the Narragansett Towers.
• Property values in Narragansett, while generally higher due to its desirable location, are often offset by the robust rental income potential.
• Tourism trends show a steady influx of visitors seeking vacation rentals, making it a favorable environment for investors.
• This consistent demand, combined with the area's natural beauty and recreational offerings, indicates a strong investment potential for Airbnb properties in Narragansett.

$2,500–$4,800 per month based on location, season, and property quality.

• Based on available market data and rental analytics, Airbnb properties in Narragansett, Rhode Island typically generate between $2,500-$4,800 per month during peak summer season (June through August) and $800-$1,500 per month during off-season periods, with annual averages ranging from $1,800-$3,200 monthly depending on property type and location.
• Oceanfront and beach-proximity properties command premium rates of $200-$450 per night in summer compared to $80-$150 for inland properties.
• Key factors significantly impacting earnings include proximity to Narragansett Beach and other coastal areas, property size and amenities, seasonal demand fluctuations driven by summer tourism.
• Properties within walking distance of the beach consistently outperform those requiring transportation, and whole-house rentals generally achieve higher occupancy rates and nightly rates than single rooms.

Potentially strong, with a typical annual ROI of 8–15%.

• Typically generate ROI between 8-15% annually, with oceanfront and near-beach properties achieving the higher end of this range due to strong summer demand from tourists visiting Narragansett Beach and the coastal attractions.
• The average payback period for initial investment ranges from 7-12 years, depending on property location and purchase price.
• Seasonal occupancy rates peak at 85-95% during June through September but drop to 15-25% in winter months, creating an average annual occupancy of approximately 55-65%.
• Compared to traditional long-term rentals in Narragansett, which typically yield 6-8% ROI with more consistent year-round income.
• The average daily rate for Narragansett Airbnb properties ranges from $150-400 depending on size, location, and season, with peak summer rates often doubling off-season prices.

Narragansett, Rhode Island averages 65–70% annual occupancy, with seasonal variation.

• Airbnb occupancy rates in Narragansett, Rhode Island typically average around 65-70% annually, with significant seasonal variation driven by its coastal tourism economy.
• Peak season from June through August sees occupancy rates soar to 85-95%, while shoulder seasons of May and September maintain moderate rates around 60-70%.
• Winter months from November through March experience the lowest occupancy at approximately 25-35% due to limited beach activities and colder weather.
• Narragansett's summer occupancy rates exceed Rhode Island's statewide average of roughly 75% and surpass the national Airbnb average of approximately 65%.
• The town's performance is particularly strong during summer weekends and holiday periods, when rates can reach near 100% capacity.

The strongest opportunities balance visitor demand, nightly rates, and acquisition cost.

• The most lucrative Airbnb investment neighborhoods in Narragansett include the Narragansett Pier area, which commands premium rates due to its direct beach access, historic carousel.
• The Bonnet Shores neighborhood offers excellent investment potential with its private beach access, upscale homes, and proximity to the Dunes Club.
• Galilee is highly desirable for its working fishing village charm, proximity to Block Island ferry terminal, and authentic coastal experience.
• The Scarborough Beach area provides strong rental demand due to its expansive sandy beach, state beach facilities, and family-friendly atmosphere.
• Point Judith offers unique investment opportunities with its lighthouse views, fishing charter access, and quieter setting that appeals to couples and small families.
• Jerusalem provides excellent value with its harbor location, seafood restaurants, and ferry access, attracting budget-conscious travelers at $125-250 per night while maintaining high occupancy rates.
• The Narrow River area appeals to nature enthusiasts and kayakers seeking peaceful waterfront experiences, offering steady bookings at $140-280 per night with lower competition from hotels.

Yes, but only where zoning permits short-term rentals and every required license is current.

• Narragansett, Rhode Island requires short-term rental operators to obtain a business license and register with the town.
• The town does not mandate owner-occupancy for short-term rentals, allowing both owner-occupied and non-owner-occupied properties to operate as vacation rentals.
• Short-term rentals are permitted in residential zones but must comply with parking requirements of one space per bedroom, maintain quiet hours between 10 PM and 8 AM.
• The registration process involves submitting an application with property details, proof of insurance, emergency contact information, and paying annual fees of approximately $150-200.
• Properties must undergo safety inspections and maintain liability insurance of at least $1 million.
• Recent changes implemented around 2020-2021 included stricter noise ordinances, enhanced parking enforcement, and requirements for 24/7 local contact persons to address complaints.

Tax rates vary by jurisdiction; licensing, inspection, and insurance costs are additional.

• Short-term rentals in Narragansett, Rhode Island are subject to several fees and taxes including the state lodging tax of 8.5% on gross rental receipts, plus an additional 1% local occupancy tax imposed by the town.
• Property owners must obtain an annual short-term rental permit from the town which costs approximately $200-300 per year, along with a one-time registration fee of around $100.
• The state requires registration with the Rhode Island Division of Taxation for tax collection purposes, which has no fee but mandates quarterly tax filings.
• Additional costs may include a $50-75 annual fire safety inspection fee, potential zoning compliance fees of $150-250, and business license requirements that can range from $25-100 annually depending on the specific business structure.
• Properties must also comply with health department regulations which may require periodic inspections costing $75-150, and owners are responsible for collecting and remitting the Rhode Island sales tax of 7% on rental income in addition to the occupancy taxes.