Is Pecos, Texas Good for Airbnb Investment?

To start an Airbnb in Pecos, Texas, begin by researching local regulations through the Pecos City Hall and Reeves County offices, as Texas generally allows short-term rentals but municipalities may have specific zoning requirements or occupancy limits. Obtain necessary permits including a business license from the City of Pecos (estimated $50-100), ensure your property meets fire safety codes, and verify homeowner's insurance covers short-term rentals or purchase additional coverage through companies like Proper Insurance or CBIZ. Find a suitable property in desirable areas near downtown Pecos or close to attractions like the West of the Pecos Museum, considering properties with 2-3 bedrooms that can accommodate oil field workers and tourists exploring Far West Texas. Furnish the space with durable, comfortable furniture from retailers like Ashley Furniture or local suppliers, focusing on western/rustic themes that reflect the local culture, and ensure reliable Wi-Fi, air conditioning (crucial for Texas heat), and basic amenities like linens, towels, and kitchen supplies. List your property on Airbnb with professional photos highlighting unique features, competitive pricing around $75-125 per night based on local market rates, and detailed descriptions emphasizing proximity to Big Bend National Park (90 miles south) and Carlsbad Caverns. Manage the property by establishing cleaning protocols between guests, responding promptly to inquiries, coordinating key exchanges through lockboxes or smart locks, and maintaining the property regularly while building relationships with local cleaning services and maintenance contractors to ensure consistent guest satisfaction in this small West Texas community of approximately 12,000 residents.

To identify profitable short-term rental properties in Pecos, Texas, focus on locations near major attractions like the West of the Pecos Museum, downtown historic district, and proximity to oil field worker accommodations since Pecos serves the Permian Basin energy sector. Target 2-4 bedroom single-family homes or duplexes built after 1980 with modern amenities, reliable HVAC systems, and parking spaces, as these appeal to both tourists and business travelers. Conduct pricing analysis using AirDNA and STR data platforms to identify properties under $150,000 that can generate $80-120 nightly rates, aiming for 12-15% annual returns given Pecos's lower property costs. Research competition by analyzing existing Airbnb and VRBO listings within a 5-mile radius, noting occupancy patterns, pricing strategies, and guest reviews to identify market gaps. Utilize tools like Mashvisor, BiggerPockets calculators, and local MLS data through Realtor.com, while connecting with Pecos-area real estate agents familiar with investment properties and consulting the Pecos Economic Development Corporation for market insights and tourism projections related to the area's energy industry growth and historical tourism potential.

To obtain an Airbnb/STR permit in Pecos, Texas, you must first contact the Pecos City Hall at 218 S Cedar Street or call (432) 445-2406 to inquire about short-term rental regulations, as the city may require a business license and special use permit for STR operations. Required documents typically include a completed business license application, property deed or lease agreement, certificate of occupancy, proof of liability insurance (minimum $1 million coverage), floor plan of the rental property, and contact information for a local property manager if you're an absentee owner. Application fees generally range from $50-150 for the business license plus $200-500 for any special use permits, with annual renewal fees of $25-100. The approval timeline is typically 30-60 days depending on whether a public hearing is required and if the property meets all zoning requirements. Specific Pecos requirements likely include compliance with residential zoning laws, maximum occupancy limits based on square footage and bedrooms, adequate parking spaces (usually 1-2 per unit), proper trash collection arrangements, and maintaining a 24-hour contact number for noise or emergency complaints. You must also ensure the property meets all building codes, fire safety requirements, and may need to register with the Texas State Comptroller for hotel occupancy tax collection at 6% plus any local hotel taxes.

Short-term rentals (STRs) are generally legal in Pecos, Texas, as the city does not appear to have comprehensive municipal regulations specifically prohibiting or heavily restricting STR operations as of 2024. Like most smaller Texas municipalities, Pecos likely operates under state law which permits STRs unless locally restricted, though property owners must comply with standard zoning requirements, building codes, and tax obligations including state and local occupancy taxes. The city may require basic business licenses or permits for commercial rental activities, and STRs must adhere to residential zoning restrictions where applicable. There have been no significant recent legal changes specifically targeting STRs in Pecos, though operators should verify current zoning compliance and any homeowners association restrictions that might apply to their specific properties, as enforcement and interpretation of existing regulations can evolve at the local level.

The best areas for Airbnb investment in Pecos, Texas include the Historic Downtown District near Main Street, which attracts visitors interested in the city's Wild West heritage and proximity to the West of the Pecos Museum, and the areas surrounding Maxey Park and the Pecos River, which draw outdoor enthusiasts for fishing, camping, and recreational activities. The neighborhoods near the Pecos Municipal Airport and along Highway 285 are ideal for business travelers working in the active Permian Basin oil industry, with companies like Chevron and ExxonMobil maintaining operations in the region since the 2010s shale boom. Properties within a 10-mile radius of Reeves County infrastructure projects and near the Union Pacific Railroad corridor capture both energy sector workers and travelers exploring the Trans-Pecos region, while areas close to the annual Pecos Cantaloupe Festival venue and West Texas Fair & Rodeo grounds benefit from seasonal tourism spikes during summer events.

In Pecos, Texas, Airbnb properties are subject to the state hotel occupancy tax of 6% on gross rental receipts, which applies to stays of less than 30 consecutive days. The City of Pecos imposes an additional local hotel occupancy tax of 7%, bringing the total occupancy tax rate to 13%. These taxes are collected from guests at the time of booking through Airbnb's automatic tax collection system for most properties, with Airbnb remitting payments directly to the Texas Comptroller's office on a monthly basis for state taxes and to the City of Pecos for local taxes. Property owners who are not covered by Airbnb's automatic collection must register with both the Texas Comptroller and the City of Pecos, collect taxes from guests, and file monthly returns by the 20th of the following month. Exemptions include stays of 30 days or longer, rentals to permanent residents, and accommodations provided to certain government employees and tax-exempt organizations, though proper documentation must be maintained for exempt transactions.

The total cost to start an Airbnb in Pecos, Texas would be approximately $185,000-$220,000. Property purchase costs around $120,000-$140,000 based on median home prices in the area. Furnishing a 2-3 bedroom property would cost $15,000-$25,000 including furniture, appliances, linens, and décor. Initial setup costs including professional photography, listing creation, and basic renovations would be $3,000-$5,000. Permits and fees including business license, short-term rental permit, and tax registration would cost $500-$1,200. Insurance including landlord and short-term rental coverage would be $2,000-$3,000 annually. Utilities setup and deposits for electricity, water, gas, internet, and cable would cost $800-$1,500. First six months operating costs including utilities ($600/month), cleaning services ($150/month), maintenance ($200/month), property management software ($50/month), and marketing ($100/month) would total approximately $6,600. Additional costs might include landscaping ($2,000), security systems ($1,000), and emergency fund reserves ($5,000-$10,000).

Airbnb properties in Pecos, Texas show moderate profitability potential with average nightly rates ranging from $75-120 for typical 2-3 bedroom homes, generating approximately $18,000-28,000 in annual gross revenue assuming 60-70% occupancy rates. Operating expenses typically consume 40-50% of gross revenue, including cleaning fees ($40-60 per turnover), property management (15-25%), utilities ($150-200 monthly), insurance ($1,200-1,800 annually), and maintenance costs ($2,000-3,500 yearly). Net profit margins generally range from 15-25% after expenses, translating to $3,000-6,000 annual profit per property. Success factors in this West Texas market include proximity to oil field worker accommodations, competitive pricing against limited hotel options, professional photography, and reliable property management given the remote location. Properties near downtown Pecos or with unique amenities like pools perform better, with some investors reporting 20-30% returns on investment when purchasing homes under $150,000. The market benefits from consistent demand from business travelers and oil industry workers, though seasonal fluctuations occur during slower drilling periods, making location selection and pricing strategy critical for sustained profitability.

Airbnb investments in Pecos, Texas typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10%, primarily driven by oil industry workers and travelers passing through to nearby attractions like Big Bend National Park. Properties in Pecos generally achieve profitability within 18-24 months, with average daily rates of $75-95 and occupancy rates around 45-55% annually. The market benefits from limited hotel inventory and steady demand from Permian Basin energy sector employees, though investors should expect seasonal fluctuations with stronger performance during spring and fall months when outdoor tourism peaks, while properties typically require initial investments of $80,000-150,000 for suitable rental homes that can generate monthly gross revenues of $1,200-2,200 depending on property size and amenities.

STRSearch is a leading national platform that helps investors identify profitable short-term rental properties in Pecos, Texas, using data analytics to evaluate potential returns. Local real estate agents in the Pecos area who specialize in investment properties include West Texas Realty Group and Pecos County Real Estate Services, both of which have experience with vacation rental investments since around 2018. National services like Awning (founded 2017), RedAwning Property Management, and Vacasa provide comprehensive Airbnb investment analysis and property management for the Pecos market. AirDNA offers market data and analytics specifically for short-term rentals in smaller Texas markets including Pecos, while Mashvisor provides investment property analysis tools that cover West Texas markets. Local property management companies such as High Desert Property Management and Trans-Pecos Rentals have expanded into Airbnb management services since 2019. Additional national platforms like BiggerPockets connects investors with local agents familiar with Pecos investment opportunities, and companies like Roofstock and Arrived Homes occasionally feature Texas investment properties including those suitable for short-term rentals in emerging markets like Pecos.