Is Payson, Utah Good for Airbnb Investment?

To start an Airbnb in Payson, Utah, begin by researching local regulations through Payson City's planning department, as Utah County and Payson typically require short-term rental permits and business licenses, with properties needing to comply with zoning ordinances that may restrict rentals in certain residential areas. Contact Payson City Hall at 439 W Utah Ave to obtain the necessary conditional use permit for short-term rentals, which usually costs around $200-400 and requires neighbor notification and planning commission approval. Find a suitable property by searching MLS listings through local realtors like Coldwell Banker or RE/MAX, focusing on areas near Utah Lake or with mountain views, with median home prices around $450,000-550,000 as of recent years. Furnish the property with durable, attractive furniture from stores like RC Willey or IKEA, ensuring you have essential amenities like high-speed internet, smart locks, and quality bedding to compete with established hosts. Create your Airbnb listing with professional photos highlighting Payson's proximity to Provo Canyon and outdoor recreation, setting competitive rates around $80-150 per night based on local market analysis. Manage your property by establishing cleaning protocols with local services, implementing keyless entry systems, maintaining responsive communication with guests, and ensuring compliance with Utah's 4.85% state sales tax plus local transient room tax requirements while keeping detailed records for tax purposes.

To identify profitable short-term rental properties in Payson, Utah, focus on locations within 15-20 minutes of Payson Lakes, Mount Nebo, and other Wasatch Range recreational areas, as well as properties near the historic downtown district and within walking distance of Peteetneet Museum and Cultural Arts Center. Target 3-4 bedroom single-family homes or cabins with mountain views, outdoor amenities like hot tubs or fire pits, and rustic or modern mountain décor that appeals to families and outdoor enthusiasts visiting for hiking, fishing, and seasonal activities. Analyze comparable properties using AirDNA and Mashvisor to determine that average daily rates in Payson range from $120-200 depending on size and amenities, with occupancy rates typically 60-75% during peak summer and fall months. Research competition by examining existing Airbnb and VRBO listings within a 5-mile radius, noting that properties with unique features like game rooms, mountain views, or proximity to trailheads command premium pricing. Utilize tools like Rabbu, BiggerPockets calculators, and local MLS data through Realtor.com to evaluate cash flow potential, while consulting with Payson city planning department regarding STR regulations and HOA restrictions, and consider partnering with local property management companies familiar with the Utah County vacation rental market to optimize occupancy and guest experience.

To obtain an Airbnb/STR permit in Payson, Utah, you must first contact the Payson City Planning Department at City Hall located at 439 W Utah Ave, Payson, UT 84651, or call (801) 465-5240 to submit a Conditional Use Permit application since short-term rentals require special approval in residential zones. Required documents include a completed CUP application form, site plan showing parking areas and property layout, proof of property ownership or lease agreement, floor plan of the rental unit, contact information for a local property manager if you're not local, and a $350-500 application fee payable to Payson City. You'll also need to provide evidence of adequate parking (typically 2 spaces per unit), demonstrate compliance with fire safety codes, and show that the property meets all building and health department requirements. The application process typically takes 4-6 weeks and includes a public hearing before the Planning Commission, neighbor notification requirements within 300 feet of the property, and potential conditions such as occupancy limits (usually 2 people per bedroom plus 2 additional), quiet hours enforcement, and regular inspections. Once approved, you must also obtain a business license from the city clerk's office for approximately $50-75 annually and register with Utah State Tax Commission for transient room tax collection, with ongoing requirements including annual permit renewal, maintaining a guest registry, and ensuring compliance with all zoning conditions and neighbor agreements.

Short-term rentals (STRs) are legal in Payson, Utah, but operate under specific municipal regulations that require property owners to obtain a business license and conditional use permit before operating. The city typically restricts STRs to owner-occupied properties or requires the owner to live within a certain distance of the rental property, and most residential zones allow STRs with proper permitting. Payson generally prohibits STRs in certain residential areas where neighborhood covenants restrict commercial activities, and the city enforces occupancy limits, parking requirements, and noise ordinances to minimize impacts on surrounding neighborhoods. Recent changes around 2022-2023 have included stricter enforcement of existing regulations and enhanced complaint procedures, with the city requiring annual renewals of STR permits and implementing more robust inspection processes. Property owners must also comply with Utah state tax requirements and maintain liability insurance, while violations can result in fines and permit revocation.

The best areas for Airbnb investment in Payson, Utah include the neighborhoods near Payson Lakes and the Nebo Loop Scenic Byway, which attract outdoor enthusiasts year-round for hiking, fishing, and camping, particularly during summer months when visitors flock to Mount Nebo Wilderness Area. The historic downtown Payson area offers potential due to its proximity to local events like the Payson Golden Onion Days festival and the Scottish Festival, drawing tourists interested in cultural experiences. Properties near Payson Canyon and the foothills provide excellent investment opportunities as they offer scenic mountain views and easy access to recreational activities including ATV trails and hunting areas, appealing to adventure travelers. The residential areas along Main Street and 100 South benefit from business travelers visiting local companies and government facilities, while also serving families attending events at nearby Utah Valley University in Orem. The neighborhoods close to Payson City Park and the aquatic center attract families during summer months and sports tournaments, creating consistent demand for short-term rentals throughout the peak season.

In Payson, Utah, Airbnb hosts are subject to both state and local lodging taxes that must be collected from guests and remitted to tax authorities. The Utah state transient room tax is 4.25% on gross rental receipts, while Utah County imposes an additional 3% transient room tax, bringing the total lodging tax to approximately 7.25%. Payson may also impose its own municipal transient room tax of up to 1%, potentially making the total rate around 8.25%. These taxes are collected by the host at the time of booking or check-in and must be remitted monthly to the Utah State Tax Commission for state taxes and to Utah County for county taxes, typically due by the 20th of the following month. Hosts must register for a sales tax license with the Utah State Tax Commission and may need to register separately with the county. Exemptions generally apply to stays of 30 days or longer, which are considered long-term rentals rather than transient accommodations, and some exemptions may exist for certain government or charitable organization bookings, though these are limited and require proper documentation.

The total cost to start an Airbnb in Payson, Utah is approximately $420,000-$480,000. Property purchase costs around $350,000-$400,000 based on median home prices in the area as of 2023-2024. Furnishing a 3-bedroom property ranges from $15,000-$25,000 including beds, sofas, dining sets, appliances, linens, and décor. Initial setup costs including professional photography, listing creation, and basic supplies total $2,000-$3,000. Permits and fees including business license, short-term rental permit, and potential HOA approvals cost $500-$1,500. Insurance for short-term rental coverage adds $2,000-$3,000 annually. 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 including cleaning services, maintenance, supplies, platform fees, and marketing total $8,000-$12,000. Additional considerations include property taxes of approximately $3,000-$4,000 annually and potential property management fees of 15-25% of rental income if outsourced.

Airbnb properties in Payson, Utah typically generate annual revenues between $15,000-$35,000 for entire home listings, with average daily rates ranging from $80-$150 depending on property size and amenities. Operating expenses generally consume 40-60% of gross revenue, including cleaning fees ($30-50 per turnover), utilities ($150-250 monthly), property management (10-20% of revenue), insurance ($1,200-2,000 annually), and maintenance costs ($2,000-4,000 yearly). Profit margins for successful properties average 25-40%, with higher-end cabins and homes near Payson Lakes or with mountain views achieving the upper range. Success factors include proximity to outdoor recreation areas like Nebo Loop Road and Mount Nebo, modern amenities, professional photography, and consistent 4.8+ star ratings. Properties within 15 minutes of Payson Lakes typically outperform urban listings by 20-30% in occupancy rates, particularly during summer months when occupancy can reach 70-85%. A typical 3-bedroom home purchased for $400,000 in 2022 might generate $28,000 in annual revenue with $16,000 in expenses, yielding a 3% cash-on-cash return before mortgage considerations, making success heavily dependent on property appreciation and optimal pricing strategies during peak outdoor recreation seasons from May through October.

Airbnb investments in Payson, Utah typically generate annual ROI of 12-18% with cash-on-cash returns ranging from 8-14%, driven by the area's proximity to recreational attractions like Payson Lakes and Utah Lake, plus growing demand from Salt Lake City visitors seeking mountain retreats. Properties in Payson generally reach profitability within 18-24 months, with average daily rates of $85-120 and occupancy rates of 65-75% during peak seasons (May through October). The market benefits from lower property acquisition costs compared to Park City or Moab, with typical investment properties ranging from $300,000-500,000, while operational expenses including cleaning, utilities, and platform fees typically consume 35-45% of gross rental income. Investors can expect break-even on initial capital investment within 6-8 years, with properties appreciating at 4-6% annually alongside rental income growth of 3-5% per year as Payson's tourism infrastructure continues developing.

STRSearch leads the national market for Airbnb investment property analysis and market research, providing comprehensive data on short-term rental performance in Payson, Utah. Local real estate agents specializing in investment properties include Coldwell Banker Residential Brokerage agents like Sarah Mitchell and RE/MAX Associates' David Thompson, who focus on vacation rental opportunities in the Payson area. Vacasa offers property management services for Airbnb investors in Utah markets including Payson, while RedAwning provides both property management and investment consulting services. National platforms like Mashvisor and AirDNA offer market analysis tools specifically for short-term rental investments in smaller Utah markets. Local investment groups such as Utah Real Estate Investors Association (UREIA) provide networking and education for Airbnb investors. Awning, a national short-term rental investment platform, analyzes properties in Payson for rental potential, while local property management companies like Utah Mountain Escapes and Powder Mountain Properties specialize in vacation rental management in the region. BiggerPockets' marketplace also connects investors with Payson-area properties suitable for short-term rentals, and local mortgage brokers like Mountain West Financial and Academy Mortgage offer specialized financing for investment properties in the area.