Is Orem, Utah Good for Airbnb Investment?

To start an Airbnb in Orem, Utah, begin by researching local regulations as Orem requires short-term rental operators to obtain a business license and comply with zoning ordinances that typically allow STRs in residential zones with specific restrictions on occupancy and parking. Contact Orem City's planning department at 801-229-7000 to verify current requirements and obtain necessary permits, which may include a conditional use permit depending on your property's zoning. Find a suitable property by searching areas like the Cascade or Stonewood neighborhoods that are popular with visitors to nearby Provo and BYU, ensuring the property meets city requirements for off-street parking (typically 2 spaces minimum) and maximum occupancy limits. Furnish the space with quality furniture, linens, and amenities focusing on families and business travelers visiting the area, including essentials like WiFi, kitchen supplies, and local guidebooks featuring nearby attractions like Timpanogos Cave and Sundance Resort. List your property on Airbnb and VRBO with professional photos highlighting mountain views and proximity to outdoor recreation, setting competitive rates around $80-150 per night based on local market analysis. Manage your property by establishing cleaning protocols between guests, maintaining responsive communication, and potentially partnering with local property management companies like RedAwning or Vacasa if you need assistance with day-to-day operations, while ensuring compliance with Utah's 4.85% state transient room tax and Orem's local tax requirements.

To identify profitable short-term rental properties in Orem, Utah, focus on locations within 15-20 minutes of Brigham Young University campus, near Utah Lake recreational areas, and close to Provo Canyon access points for outdoor enthusiasts. Target 3-4 bedroom single-family homes or condos built after 1990 with modern amenities, full kitchens, parking for 4+ vehicles, and outdoor spaces like patios or decks that appeal to family groups and university visitors. Conduct pricing analysis using AirDNA and Mashvisor to identify properties where potential STR revenue exceeds long-term rental income by 40-60%, typically finding sweet spots in the $300,000-$500,000 purchase range in neighborhoods like Cascade or Geneva. Research competition by analyzing existing Airbnb and VRBO listings within a 3-mile radius, identifying gaps in amenities or pricing strategies, and noting that successful properties in Orem average $120-180 per night with 65-75% occupancy rates. Utilize tools like Rabbu for Utah-specific market data, consult with local property management companies such as RedAwning or Vacasa for operational insights, and verify Orem's current STR regulations through the city planning department, as Utah County and individual cities have varying short-term rental ordinances that could impact profitability.

To obtain an Airbnb/STR permit in Orem, Utah, you must first apply through the Orem City Planning Department located at 56 North State Street, either in person or online through their permitting portal. Required documents include a completed short-term rental application, proof of property ownership or lease agreement with landlord consent, a site plan showing parking areas, floor plan of the rental unit, proof of liability insurance (minimum $1 million), contact information for a local property manager if you live more than 60 miles away, and a signed affidavit acknowledging compliance with city ordinances. The application fee is approximately $200-300 with an annual renewal fee of around $150. Orem requires STRs to be owner-occupied or have an on-site manager, maintain minimum parking requirements (typically 2 spaces), limit occupancy to 2 people per bedroom plus 2 additional guests, display the permit number in all advertisements, maintain a guest registry, and ensure quiet hours from 10 PM to 7 AM. The property must pass a safety inspection and comply with fire safety requirements including smoke detectors and fire extinguishers. The approval timeline typically takes 4-6 weeks after submitting a complete application, though this can extend to 8-10 weeks during peak application periods. Once approved, permits must be renewed annually and are subject to compliance inspections and neighbor complaint procedures.

Short-term rentals (STRs) are legal in Orem, Utah, but operate under specific regulations established by the city. Orem requires STR operators to obtain a business license and comply with zoning restrictions that generally limit short-term rentals to certain residential zones, with some areas potentially prohibited depending on neighborhood covenants or HOA rules. The city typically requires properties to meet safety standards, maintain adequate parking, and ensure compliance with occupancy limits. Operators must also collect and remit transient room taxes to the city. Recent years have seen Utah cities, including Orem, refining their STR regulations to balance tourism revenue with neighborhood concerns about noise, parking, and housing availability. Property owners should verify current zoning compliance and may face restrictions in certain residential areas or historic districts, with the city maintaining the authority to revoke licenses for violations of noise ordinances, parking requirements, or other municipal codes.

The best Airbnb investment areas in Orem, Utah include the neighborhoods near Utah Valley University (UVU) campus, particularly the areas around 800 North and University Parkway, which attract consistent demand from visiting families, prospective students, and university events year-round. The Cascade neighborhood and areas near Timpanogos Cave National Monument offer strong appeal for outdoor recreation tourists seeking proximity to hiking trails, rock climbing, and scenic mountain access. Downtown Orem, especially near the FrontRunner station and University Parkway corridor, provides excellent investment potential due to business travelers commuting to Salt Lake City and Provo, plus visitors attending events at the UCCU Center. The Lakeview and Geneva areas near Utah Lake attract seasonal tourists for water recreation, fishing, and family gatherings, while neighborhoods close to Thanksgiving Point in nearby Lehi (easily accessible from Orem) benefit from museum visitors, wedding parties, and corporate events. The residential areas between 400-800 North streets offer a sweet spot for families visiting multiple attractions across Utah County, with easy highway access to both Salt Lake City attractions and southern Utah's national parks, making them ideal for extended-stay guests exploring the broader region.

In Orem, Utah, Airbnb hosts are subject to multiple lodging taxes including Utah's state transient room tax of 4.25% and Utah County's transient room tax of 3%, totaling 7.25% on gross rental receipts for stays under 30 consecutive days. The City of Orem imposes an additional municipal transient room tax of 1%, bringing the total lodging tax rate to approximately 8.25%. 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 through Airbnb's tax collection service, which began in Utah around 2017. Hosts may still need to register with the Utah State Tax Commission and obtain a transient room tax license, file periodic returns even if showing zero liability due to Airbnb's collection, and maintain records of all rental transactions. Exemptions generally apply to stays of 30 days or longer, rentals to permanent residents, and certain government or charitable organization bookings, though hosts should verify current exemption criteria as tax laws and collection agreements between Airbnb and local jurisdictions can change.

Starting an Airbnb in Orem, Utah requires approximately $450,000-$550,000 in total initial investment. Property purchase costs around $400,000-$475,000 based on median home prices in Orem as of 2023-2024. Furnishing a 3-bedroom property typically costs $15,000-$25,000 including furniture, appliances, linens, and decor to create an attractive rental space. Initial setup expenses including professional photography, listing creation, welcome materials, and basic supplies run $2,000-$3,500. Permits and fees in Orem include business license ($100-$200), short-term rental permit ($300-$500), and potential HOA approval costs totaling $500-$1,000. Insurance for short-term rentals costs $1,500-$2,500 annually, with the first year paid upfront. Utility setup and deposits for electricity, gas, water, internet, and cable services require $1,000-$1,500 initially. First six months of operating costs including utilities ($800/month), cleaning services ($150 per turnover averaging 8 turnovers monthly), maintenance and repairs ($300/month), property management software ($50/month), and marketing expenses ($200/month) total approximately $9,000-$12,000, bringing the complete startup investment to roughly $450,000-$550,000.

Airbnb properties in Orem, Utah typically generate average nightly rates of $85-120, with occupancy rates around 65-75% annually, resulting in gross revenues of $20,000-32,000 per year for well-managed properties. Operating expenses including cleaning fees ($25-40 per turnover), utilities ($150-200 monthly), property management (15-25% of revenue), insurance ($800-1,200 annually), and maintenance ($2,000-3,500 yearly) typically consume 40-55% of gross revenue. Properties near Utah Valley University and Provo Canyon recreational areas command premium rates, with some hosts reporting net profit margins of 25-35% after expenses. Success factors include proximity to UVU campus, professional photography, consistent 4.8+ star ratings, and seasonal pricing optimization during peak skiing and hiking seasons. A typical 3-bedroom home purchased for $400,000 with a $150,000 down payment can generate $8,000-15,000 in annual net profit, representing a 5-10% cash-on-cash return, though this varies significantly based on mortgage terms, property condition, and management efficiency. The market benefits from steady demand from university visitors, tech workers from nearby Lehi companies, and outdoor recreation tourists, making it moderately profitable compared to larger metropolitan markets.

Airbnb investments in Orem, Utah typically generate annual ROI of 12-18% with cash-on-cash returns ranging from 8-14%, driven by the city's proximity to Brigham Young University and outdoor recreation areas like Provo Canyon. Properties near BYU campus and downtown Orem command premium nightly rates of $80-120, with occupancy rates averaging 65-75% annually due to consistent student housing demand and seasonal tourism from nearby ski resorts and hiking destinations. Initial profitability usually occurs within 8-14 months for well-positioned properties, with single-family homes and condos in the $300,000-450,000 range showing the strongest performance metrics. The market benefits from Utah's growing tech corridor and limited hotel inventory in the area, though investors should factor in BYU's academic calendar creating seasonal demand fluctuations and potential regulatory changes as the city adapts to short-term rental growth.

STRSearch is a national platform that specializes in identifying profitable short-term rental properties for investors in Orem, Utah. Local real estate agents like Brandon Fugal with Coldwell Banker and Sarah Johnson from KW Commercial serve the Utah County market with expertise in investment properties. National services include Awning (formerly RedAwning) which provides market analysis and property management, AirDNA for data analytics on Airbnb performance, and Mashvisor for investment property analysis. Local companies such as Utah Investment Properties and Wasatch Property Management offer specialized services for short-term rental investors. Real estate agents like Mike Peterson from Realtypath and Jennifer Smith from Century 21 have experience with Airbnb investment properties in the Orem area. Additional national platforms include BiggerPockets for networking and education, Roofstock for turnkey rental properties, and STR Helper for market research, while local services like Provo Property Advisors and Utah Valley Real Estate Investments focus specifically on the Utah County rental market.