Is Redmond, Washington Good for Airbnb Investment?

To start an Airbnb in Redmond, Washington, begin by researching local regulations as Redmond requires short-term rental operators to obtain a business license and comply with zoning restrictions that typically limit rentals to residential zones with owner-occupancy requirements in some areas. Contact Redmond's Planning Department at City Hall (15670 NE 85th Street) to verify zoning compliance and obtain necessary permits including a business license ($50-100 annually) and potentially a conditional use permit if required for your specific zone. Find a suitable property by purchasing or leasing in approved residential areas, ensuring the lease allows short-term rentals if renting, with average property costs ranging $600,000-$800,000 for purchase or $2,500-$4,000 monthly for rental in 2024. Furnish the space with quality furniture, linens, kitchen essentials, and amenities targeting tech workers and visitors to nearby Microsoft headquarters, budgeting $5,000-$15,000 for complete furnishing depending on property size. Create your Airbnb listing with professional photos, competitive pricing ($80-$200 per night based on property type), and detailed descriptions highlighting proximity to Microsoft, Marymoor Park, and downtown Bellevue. Manage the property by establishing check-in procedures, maintaining cleanliness standards, responding promptly to guests, and ensuring compliance with Washington State's 10.4% combined sales tax on short-term rentals while keeping detailed records for tax purposes and potential city inspections.

To identify profitable short-term rental properties in Redmond, Washington, focus on locations within 2-3 miles of major tech campuses like Microsoft headquarters, near downtown Redmond's dining and shopping districts, or close to outdoor recreation areas like Marymoor Park and Sammamish River Trail. Target 2-4 bedroom single-family homes or condos built after 1990 with modern amenities, dedicated parking, fast internet, and outdoor spaces, as these appeal to business travelers and families visiting the area. Analyze pricing by researching comparable Airbnb listings in neighborhoods like Overlake, Education Hill, and Bear Creek, aiming for properties that can generate $150-250 per night with 65-75% occupancy rates to achieve 8-12% annual returns. Study competition density using AirDNA or Mashvisor to identify undersupplied micro-markets, particularly focusing on areas with fewer than 10 active STRs within a half-mile radius. Utilize Zillow, Redfin, and local MLS data for property acquisition, STR Helper for permit research, and connect with Redmond-specific real estate agents familiar with King County's STR regulations, while monitoring seasonal demand patterns driven by Microsoft events, summer outdoor activities, and proximity to Seattle-Bellevue business corridor traffic.

To obtain an Airbnb/STR permit in Redmond, Washington, you must apply through the City of Redmond's Development Services Department either online via their permit portal or in person at City Hall located at 15670 NE 85th Street. Required documents include a completed short-term rental business license application, proof of property ownership or lease agreement with landlord consent, floor plan showing the rental unit, parking plan demonstrating adequate off-street parking, contact information for a local responsible party available 24/7, proof of liability insurance (minimum $1 million), and a good neighbor agreement outlining house rules. The application fee is approximately $200-300 with an annual renewal fee of around $150-200. You must also obtain a Washington State business license and register for state and local taxes. The approval timeline typically takes 4-6 weeks for complete applications, though complex cases may take longer. Redmond-specific requirements include limiting occupancy to 2 guests per bedroom plus 2 additional guests (maximum 10 total), providing one off-street parking space per rental unit, maintaining quiet hours from 10 PM to 7 AM, posting emergency contact information prominently in the unit, and ensuring the responsible party can respond to issues within 30 minutes. Properties in certain residential zones may have additional restrictions, and HOA approval may be required where applicable.

Short-term rentals (STRs) are legal in Redmond, Washington, but operate under specific regulations established by the city. As of recent years, Redmond requires STR operators to obtain a business license and comply with zoning restrictions that generally limit short-term rentals to single-family residential zones, with some restrictions in multifamily areas. The city prohibits STRs in certain residential zones and requires operators to meet safety standards, parking requirements, and noise ordinances. Properties must be owner-occupied or have an on-site manager, and there are limits on the number of guests and vehicles. Redmond has implemented these regulations around 2018-2020 to balance tourism benefits with neighborhood preservation, requiring annual renewals and imposing penalties for violations. The city also mandates that STR operators collect and remit applicable taxes and maintain liability insurance, while some homeowner associations may have additional restrictions that could further limit STR operations in specific neighborhoods.

The best Airbnb investment areas in Redmond, Washington include Downtown Redmond near the Microsoft campus, which attracts significant business travelers and tech professionals visiting the headquarters established in 1975, along with nearby Overlake and Grasslawn neighborhoods that offer easy access to major employers like Nintendo of America and SpaceX. The Sammamish River Trail corridor and Marymoor Park vicinity are highly attractive for leisure travelers seeking outdoor recreation, dog park activities, and concert events at the amphitheater, while the Redmond Town Center area provides urban amenities and shopping attractions. Bear Creek and Education Hill neighborhoods offer family-friendly accommodations for visitors attending youth sports tournaments and events at local facilities, and the Willows/Rose Hill area near the border with Kirkland captures overflow demand from Seattle's tech corridor while providing more affordable alternatives to downtown Seattle accommodations, benefiting from Redmond's position as a major tech hub with companies like Microsoft generating consistent year-round business travel demand since the 1980s.

In Redmond, Washington, Airbnb hosts are subject to multiple lodging taxes including the Washington State Lodging Tax of 0.2%, King County Lodging Tax of 2.8%, and the City of Redmond Lodging Tax of 2%, totaling approximately 5% in combined lodging taxes. These taxes apply to stays of less than 30 consecutive days and are typically collected by Airbnb directly from guests at the time of booking for most listings, with Airbnb remitting payments quarterly to the respective tax authorities. Hosts must register with the Washington State Department of Revenue and obtain a business license, and if Airbnb is not collecting taxes on their behalf, they must collect the taxes themselves and remit them monthly to the state by the 25th of the following month, quarterly to King County, and according to Redmond's schedule. Additionally, hosts may need to collect and remit local sales tax of approximately 10.25% on cleaning fees and other taxable services. Exemptions typically include stays of 30 days or longer, stays by certain government employees on official business, and accommodations provided to homeless individuals through qualifying programs, though hosts should verify current exemption criteria as they can change.

To start an Airbnb in Redmond, Washington, the total costs would be approximately $1,150,000-$1,300,000. Property purchase represents the largest expense at $900,000-$1,000,000 based on median home prices in Redmond as of 2023-2024. Furnishing costs for a complete 2-3 bedroom property would range $25,000-$40,000 including furniture, appliances, linens, and décor to create an attractive rental space. Initial setup costs including professional photography, listing creation, welcome materials, and basic supplies would be $2,000-$3,500. Permits and fees vary but typically include business license ($200-$500), short-term rental permit ($300-$800), and potential HOA approval fees totaling $500-$1,300. Insurance costs for short-term rental coverage would be $3,000-$5,000 annually, so approximately $1,500-$2,500 for six months. Utilities including electricity, gas, water, internet, and cable would average $300-$500 monthly, totaling $1,800-$3,000 for six months. First six months operating costs including cleaning services ($150-$250 per turnover), maintenance, restocking supplies, platform fees (3% of bookings), and marketing would range $8,000-$15,000 depending on occupancy rates. Additional considerations include property taxes, potential property management fees (10-20% of revenue), and emergency repair funds.

Airbnb properties in Redmond, Washington demonstrate strong profitability potential due to the city's proximity to major tech companies like Microsoft and Nintendo of America, with average nightly rates ranging from $120-180 for entire homes and $60-90 for private rooms. Properties typically generate $2,500-4,500 monthly revenue, while expenses including mortgage payments, utilities, cleaning fees ($40-60 per turnover), property management (10-20% of revenue), insurance ($150-300 monthly), and maintenance average $1,800-2,800 monthly, resulting in profit margins of 25-40% for well-managed properties. Success factors include proximity to Microsoft's campus in nearby Bellevue, modern amenities, professional photography, and responsive hosting, with properties within 10 miles of tech hubs commanding premium rates. A typical case study involves a 3-bedroom home near downtown Redmond generating $3,800 monthly revenue with $2,400 in expenses, yielding $1,400 monthly profit and 37% margins, though seasonal variations occur with higher demand during tech conferences and summer months when occupancy rates reach 75-85% compared to 60-70% in winter.

Airbnb investments in Redmond, Washington typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10%, driven by the city's proximity to Microsoft headquarters and strong tech worker demand for short-term rentals. Properties within 2-3 miles of Microsoft's campus achieve higher returns of 10-14% annually, with average daily rates of $120-180 for entire homes and $60-90 for private rooms. Initial profitability usually occurs within 12-18 months, assuming 65-75% occupancy rates throughout the year. The market benefits from consistent business travel demand, with peak seasons during Microsoft events and summer months generating 15-20% higher rates. Investment properties typically require $50,000-80,000 down payment for median-priced homes around $800,000-1,200,000, with monthly cash flow of $800-1,500 after expenses including mortgage, utilities, cleaning, and platform fees averaging 25-30% of gross revenue.

STRSearch is a national platform that specializes in identifying profitable short-term rental properties for investors in Redmond, Washington. Local real estate agents like Windermere Real Estate and John L. Scott have agents experienced in investment properties and vacation rentals in the Redmond area. Mashvisor provides data analytics for Airbnb investment properties nationwide including Washington markets, while AirDNA offers market analysis and revenue projections for short-term rentals in the Seattle metro area. BiggerPockets connects investors with local real estate professionals familiar with Redmond's rental market. Local property management companies like RedAwning and Vacasa can help investors identify and manage profitable Airbnb properties in Redmond. Real estate investment firms such as Roofstock and Arrived Homes occasionally feature properties in Washington state markets. Additionally, local real estate agents at Redfin and Compass have investment-focused agents who understand the Redmond market dynamics and can help identify properties suitable for short-term rental conversion.