Is Pawtucket, Rhode Island Good for Airbnb Investment?

To start an Airbnb in Pawtucket, Rhode Island, begin by researching local zoning laws and regulations through the Pawtucket Planning Department, as the city requires short-term rental operators to obtain a business license and comply with fire safety codes established around 2019-2020. Contact the Pawtucket Building Department at City Hall (137 Roosevelt Avenue) to secure necessary permits including a Certificate of Occupancy for short-term rentals, fire safety inspection, and potentially a special use permit depending on your property's zoning district. Find a suitable property in desirable neighborhoods like Fairlawn, Oak Hill, or near the Blackstone River, ensuring it meets the city's requirement of being owner-occupied or having proper commercial zoning for non-owner-occupied rentals. Furnish the space with quality essentials including comfortable bedding, kitchen supplies, WiFi, and safety equipment like smoke detectors and fire extinguishers as mandated by Pawtucket fire codes. Create your listing on Airbnb and other platforms, highlighting proximity to Providence (just 4 miles away), local attractions like Slater Mill Historic Site, and competitive pricing typically ranging $75-150 per night in the area. Manage your property by maintaining cleanliness standards, responding promptly to guests, collecting the required 13% Rhode Island state tax plus 1% local occupancy tax, and ensuring compliance with Pawtucket's noise ordinances and parking regulations while keeping detailed records for annual business license renewal with the city clerk's office.

To identify profitable short-term rental properties in Pawtucket, Rhode Island, focus on locations within walking distance of downtown attractions, near the Blackstone River Bikeway, or close to Providence (just 5 miles south) for spillover demand. Target 2-3 bedroom properties built after 1950 with parking, updated kitchens, and unique character features that photograph well, as Pawtucket's industrial heritage appeals to visitors seeking authentic New England experiences. Analyze pricing by researching comparable Airbnb listings in the $80-150 nightly range, factoring in Pawtucket's lower property costs compared to Providence while considering seasonal demand from summer tourists and Brown University/RISD visitors. Study competition using AirDNA and Mashvisor to identify gaps in the market, noting that Pawtucket has fewer STR options than Providence, creating opportunity for well-positioned properties. Utilize tools like Rabbu for Rhode Island-specific rental regulations, monitor the Pawtucket Arts & Entertainment District development for emerging hotspots, and leverage local Facebook groups and the Greater Providence Chamber of Commerce for market insights, while ensuring compliance with Rhode Island's STR registration requirements and Pawtucket's zoning ordinances.

To obtain an Airbnb/STR permit in Pawtucket, Rhode Island, you must first contact the Pawtucket Planning Department at City Hall located at 137 Roosevelt Avenue to inquire about short-term rental regulations, as the city has been developing specific ordinances since 2019. You'll need to submit an application that includes proof of property ownership or lease agreement, a detailed floor plan, certificate of occupancy, proof of liability insurance (typically $1 million minimum), fire safety inspection certificate from the Pawtucket Fire Department, and a business license from the City Clerk's office. Required documents also include a parking plan showing adequate off-street parking, contact information for a local property manager if you're not residing on-site, and neighbor notification forms. The application fee is estimated at $150-300 annually, with additional inspection fees of approximately $75-150. The timeline typically takes 4-8 weeks from submission to approval, depending on inspection scheduling and any required corrections. Pawtucket-specific requirements include maintaining the property's residential character, limiting occupancy to no more than 2 guests per bedroom with a maximum of 8 guests total, providing adequate parking (typically 1 space per bedroom), and ensuring compliance with the city's noise ordinance and trash collection schedule.

Short-term rentals (STRs) in Pawtucket, Rhode Island operate under the city's zoning ordinances and require proper permitting, though the regulatory framework is less restrictive than some neighboring communities. As of 2023, STRs are generally permitted in residential zones but must comply with occupancy limits, parking requirements, and safety standards including smoke detectors and carbon monoxide detectors. Property owners must obtain a business license and may need to register with the city, while also ensuring compliance with state tax requirements. The city has implemented noise ordinances and neighbor notification procedures to address community concerns, and properties must maintain adequate off-street parking for guests. Recent changes around 2022-2023 have included stricter enforcement of existing regulations and enhanced complaint procedures, though Pawtucket has not implemented the more restrictive caps or prohibitions seen in cities like Newport or Providence. STRs are generally prohibited in areas zoned exclusively for single-family residential use without proper permits, and the city reserves the right to revoke permits for properties with repeated violations or neighbor complaints.

The best areas for Airbnb investment in Pawtucket, Rhode Island include the Historic Downtown District near Main Street, which attracts visitors interested in the city's industrial heritage and proximity to the Blackstone River Bikeway, and the Fairlawn neighborhood, offering affordable properties with easy access to Providence (just 10 minutes away) making it ideal for business travelers and tourists visiting Rhode Island's capital. The area around Slater Mill Historic Site is particularly attractive due to its significance as America's first water-powered cotton spinning factory, drawing history enthusiasts and educational groups year-round. Properties near McCoy Stadium benefit from baseball fans attending Pawtucket Red Sox games during the season, while the neighborhoods along the East Bay Bike Path attract cycling tourists and outdoor enthusiasts. The Darlington and Oakhill areas offer good investment potential due to lower property costs compared to Providence while maintaining convenient access to major employers like Hasbro headquarters, Brown University, and downtown Providence's business district, making them suitable for extended-stay business travelers and visitors to nearby attractions.

In Pawtucket, Rhode Island, Airbnb hosts are subject to Rhode Island's state lodging tax of 5% on gross receipts from short-term rentals under 30 days, which applies to all transient accommodations including vacation rentals and home-sharing properties. The state tax is collected by Airbnb directly from guests at the time of booking and remitted to the Rhode Island Division of Taxation on behalf of hosts through their voluntary collection agreement established in 2017. Additionally, hosts may be subject to Pawtucket's local hotel tax of 6% on gross room receipts, though enforcement and collection procedures vary at the municipal level and some hosts may need to register directly with the city and remit taxes quarterly. There are no specific exemptions for small-scale operators, and the combined effective tax rate can reach 11% when both state and local taxes apply. Hosts should verify current local requirements with Pawtucket's tax assessor office, as municipal regulations and collection procedures for short-term rentals continue to evolve, and some cities have implemented additional registration fees or occupancy limits that may affect tax obligations.

To start an Airbnb in Pawtucket, Rhode Island, expect total costs around $285,000-$320,000. Property purchase represents the largest expense at $250,000-$280,000 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, appliances, linens, and decor. Initial setup costs including professional photography, listing creation, and basic renovations average $3,000-$5,000. Permits and fees in Rhode Island include business registration ($50), short-term rental permits ($200-$500), and potential city licensing fees totaling approximately $1,000. Insurance costs run $1,200-$2,000 annually for short-term rental coverage. Utility setup and deposits for electricity, gas, water, internet, and cable average $500-$800 initially. First six months operating costs including utilities ($1,800), cleaning services ($2,400), maintenance ($1,500), property management software ($300), and marketing ($500) total approximately $6,500. Additional considerations include potential HOA fees, property taxes, and emergency fund reserves of $2,000-$3,000 for unexpected repairs or vacancy periods.

Airbnb properties in Pawtucket, Rhode Island typically generate annual revenues between $15,000-$35,000 for entire homes and $8,000-$18,000 for private rooms, with average daily rates ranging from $65-$120 depending on property type and location proximity to Providence. Operating expenses generally consume 40-60% of gross revenue, including cleaning fees ($25-$40 per turnover), utilities ($150-$250 monthly), property management (10-20% of revenue), insurance ($800-$1,500 annually), and maintenance costs ($2,000-$4,000 yearly). Properties near downtown Pawtucket or within walking distance of the Blackstone River Bikeway command premium rates and achieve 60-75% occupancy rates, resulting in net profit margins of 25-35%. Success factors include professional photography, responsive communication, competitive pricing during peak summer months and fall foliage season, and targeting business travelers visiting nearby companies like Hasbro in adjacent Pawtucket or tourists exploring Rhode Island's industrial heritage. A typical 2-bedroom Victorian home near Slater Mill generates approximately $28,000 annually with $17,000 in expenses, yielding $11,000 profit (39% margin), while properties in less desirable areas may struggle with 40-50% occupancy and margins below 20%.

Based on Pawtucket, Rhode Island market conditions, Airbnb investments typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10% depending on property type and location within the city. Properties near downtown Pawtucket or close to Providence attractions tend to perform better, with average daily rates of $85-120 and occupancy rates of 65-75% annually. Initial profitability usually occurs within 18-24 months after accounting for startup costs, furnishing, and marketing expenses. Two-bedroom properties near the Blackstone River or historic districts show stronger performance with potential ROI reaching 14-16% in prime locations. Market data from 2023-2024 indicates that investors typically achieve break-even on their initial investment within 2-3 years, with properties requiring $15,000-25,000 in initial setup costs for a typical single-family or multi-unit conversion in Pawtucket's rental market.

STRSearch is a national platform that specializes in identifying profitable short-term rental properties for investors looking in Pawtucket, Rhode Island. Local real estate agents like those at RE/MAX Properties and Coldwell Banker Residential Brokerage have experience with investment properties in the Pawtucket market and understand local zoning regulations for short-term rentals. National services include AirDNA (founded 2015) which provides market data and analytics for Airbnb investments, Mashvisor (2014) offering property analysis tools, and BiggerPockets (2004) connecting investors with local professionals. Awning (2017) and RedAwning (2009) are vacation rental management companies that also help investors identify profitable properties. Local property management companies like Ocean State Property Management and Rhode Island Rental Properties can provide insights into the Pawtucket rental market. Real estate investment firms such as HomeVestors and We Buy Ugly Houses occasionally work with investors seeking rental properties. Additionally, platforms like Roofstock (2015) and Fundrise (2012) offer investment opportunities in rental properties, though their Pawtucket inventory may be limited.