Is Round Lake, Illinois Good for Airbnb Investment?

To start an Airbnb in Round Lake, Illinois, begin by researching local zoning laws and regulations through the Round Lake Village Hall, as the city requires short-term rental operators to obtain a business license and may have specific zoning restrictions in residential areas. Contact the Lake County Health Department for any required health permits and ensure compliance with Illinois state tax requirements including registering for sales tax collection. Find a suitable property by searching residential areas that allow short-term rentals, considering proximity to Chain O'Lakes recreation areas which attract tourists, and ensure the property meets safety codes including smoke detectors, carbon monoxide detectors, and proper egress windows. Obtain necessary permits including a Round Lake business license (approximately $50-100 annually), register with the Illinois Department of Revenue for tax collection, and secure appropriate insurance coverage that includes short-term rental protection. Furnish the property with quality furniture, linens, kitchen essentials, and amenities that appeal to lake visitors such as outdoor furniture, grills, and water recreation equipment. Create your Airbnb listing with professional photos highlighting lake access or proximity, competitive pricing based on seasonal demand (higher rates during summer lake season), and detailed descriptions of local attractions like Chain O'Lakes State Park. Manage the property by establishing cleaning protocols between guests, responding promptly to inquiries, coordinating key exchanges or installing smart locks, maintaining the property regularly, and collecting and remitting the required Illinois state sales tax (currently 6.25%) plus any local taxes to Round Lake and Lake County authorities.

To identify profitable short-term rental properties in Round Lake, Illinois, focus on locations within walking distance of Chain O'Lakes State Park and near the Fox River waterfront, as these areas attract tourists seeking outdoor recreation and water activities. Target 2-4 bedroom single-family homes or condos built after 1990 with modern amenities, full kitchens, outdoor spaces like decks or patios, and parking for multiple vehicles, as families and groups visiting the lakes prefer these features. Conduct pricing analysis by researching comparable Airbnb and VRBO listings within a 5-mile radius, noting that properties near water typically command $150-250 per night during peak summer months and $80-120 during off-season. Research competition using AirDNA and Mashvisor to analyze occupancy rates, average daily rates, and seasonal demand patterns, while checking local Facebook groups and tourism websites to understand visitor preferences. Utilize tools like Zillow and Realtor.com for property searches, STR Helper for rental income projections, and contact the Round Lake municipal offices to verify short-term rental regulations and permit requirements, as Lake County has specific zoning restrictions that vary by location within the city limits.

To obtain an Airbnb/STR permit in Round Lake, Illinois, contact the Round Lake Building and Zoning Department at City Hall located at 442 Nippersink Road, Round Lake, IL 60073, or call (847) 546-8558 to initiate the application process. Required documents typically include a completed short-term rental license application, proof of property ownership or lease agreement with landlord consent, certificate of insurance with minimum $1 million liability coverage, floor plan of the rental unit, contact information for a local property manager if you live more than 50 miles away, and payment of applicable fees. The application fee is estimated at $200-300 annually with possible additional inspection fees of $75-150. Submit all documents to the Building Department and schedule a required safety inspection which will verify smoke detectors, carbon monoxide detectors, fire extinguishers, and compliance with occupancy limits. The approval timeline is typically 4-6 weeks from complete application submission, pending successful inspection and any required corrections. Round Lake specific requirements likely include maximum occupancy of 2 people per bedroom plus 2 additional guests, quiet hours from 10 PM to 7 AM, designated parking spaces for guests, and maintaining a guest registry. Once approved, display your permit number in all online listings and renew annually by December 31st with updated insurance documentation and any required re-inspections.

Short-term rentals (STRs) in Round Lake, Illinois are generally prohibited in residential zoning districts under the city's current ordinances as of 2023. The city has maintained restrictive policies toward STRs, treating them as commercial activities that are not permitted in residential areas, which comprise the majority of Round Lake's housing stock. Property owners cannot legally operate Airbnb, VRBO, or similar short-term rental properties in single-family residential zones, and violations can result in fines and cease-and-desist orders. The city has not implemented a licensing or registration system for STRs because they are effectively banned in most areas where such rentals would typically operate. Round Lake's approach aligns with several other Lake County municipalities that have taken restrictive stances on short-term rentals, citing concerns about neighborhood character, parking, noise, and housing availability for long-term residents. There have been no significant recent changes to liberalize these restrictions, and the city continues to enforce its prohibition on STRs in residential areas through code enforcement actions when violations are reported.

The best areas for Airbnb investment in Round Lake, Illinois include the Chain O'Lakes region along the Fox River corridor, particularly near Chain O'Lakes State Park which attracts year-round outdoor enthusiasts for boating, fishing, and camping activities. The downtown Round Lake area offers proximity to the Metra train station providing easy access to Chicago, making it attractive for business travelers and weekend visitors exploring the northern suburbs. Properties near Round Lake Beach along the lakefront command premium rates due to water access and scenic views, particularly popular during summer months from May through September. The Route 120 corridor benefits from its strategic location between major employment centers like Abbott Laboratories in North Chicago and various corporate offices in Libertyville, generating consistent business travel demand. Areas near Rollins Savanna Forest Preserve attract nature tourism and outdoor recreation visitors, while neighborhoods within walking distance of local marinas and boat launches see strong seasonal demand from boating enthusiasts visiting the Chain O'Lakes waterway system.

In Round Lake, Illinois, Airbnb properties are subject to multiple lodging taxes including the Illinois Hotel Operators' Occupation Tax at 6% of gross rental receipts, Lake County's hotel/motel tax at approximately 3%, and potentially a local Round Lake municipal lodging tax estimated at 2-4%. The state tax is collected by the Illinois Department of Revenue with monthly remittance required for operators with over $20,000 in annual receipts, while smaller operators may remit quarterly. Lake County's tax is administered separately with monthly filing requirements, and local Round Lake taxes are typically collected through the city clerk's office with monthly or quarterly remittance depending on volume. Airbnb may collect and remit some of these taxes directly on behalf of hosts through their platform, particularly the state tax, but hosts remain responsible for ensuring compliance with all applicable local taxes. Exemptions generally apply to stays exceeding 30 consecutive days, rentals to permanent residents, and certain government or charitable organization bookings, though specific exemption criteria vary by jurisdiction and hosts should verify current rates and collection procedures as tax obligations can change frequently.

The total cost to start an Airbnb in Round Lake, Illinois is approximately $285,000-$320,000. Property purchase costs around $220,000-$250,000 based on median home prices in the area. Furnishing a 2-3 bedroom property requires $15,000-$25,000 for quality furniture, bedding, kitchenware, and decor. Initial setup including professional photography, listing creation, and marketing materials costs $1,500-$2,500. Permits and fees including business license, short-term rental permit, and potential HOA approvals total $500-$1,200. 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 ($150 per turnover), supplies, maintenance, property management software, and marketing total $8,000-$12,000. Additional considerations include potential property improvements ($5,000-$10,000) and working capital reserves for vacancy periods and unexpected expenses ($10,000-$15,000).

Airbnb properties in Round Lake, Illinois 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), property management (10-20% of revenue), utilities ($150-300 monthly), insurance ($1,200-2,000 annually), and maintenance costs averaging $2,000-4,000 yearly. Net profit margins typically range from 15-35% for well-managed properties, with successful hosts in the Round Lake area achieving higher margins by targeting weekend lake visitors and Chicago metro area travelers seeking affordable alternatives to city accommodations. Properties within walking distance of Round Lake Beach or featuring lake views command premium rates of $120-180 nightly, while standard suburban homes average $80-120. Success factors include professional photography, consistent 4.8+ star ratings, quick response times under 1 hour, and seasonal pricing strategies that capitalize on summer lake season demand from May through September. A typical 3-bedroom lakefront property in Round Lake might generate $28,000 annually with $16,000 in expenses, yielding a 43% profit margin, while inland properties average closer to 25-30% margins due to lower nightly rates and occupancy levels around 55-65% compared to 70-80% for premium lakefront listings.

Based on Round Lake, Illinois 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 market. Properties near Chain O'Lakes and downtown areas command higher nightly rates of $80-140, while standard residential properties average $60-100 per night with 65-75% occupancy rates during peak summer months and 45-55% in winter. Initial investment recovery and profitability typically occurs within 18-24 months for well-positioned properties, with vacation rental management companies like Vacasa and RedAwning reporting stronger performance for lakefront and proximity-to-Chicago properties. The market benefits from Chicago metropolitan area demand, seasonal lake tourism, and business travelers, with properties requiring $15,000-25,000 in initial setup and furnishing costs generating monthly gross revenues of $2,500-4,500 during peak seasons and $1,200-2,800 during off-peak periods.

STRSearch is a national platform that specializes in identifying profitable short-term rental properties for investors, offering market analysis and property recommendations for Round Lake, Illinois. Local real estate agents in the area who focus on investment properties include Coldwell Banker Realty agents serving Lake County, RE/MAX professionals with vacation rental expertise, and Keller Williams agents specializing in investment properties around the Chain O' Lakes region. National services include Awning (formerly RedAwning) which provides end-to-end Airbnb investment services, AirDNA for market data and analytics, Mashvisor for rental property analysis, and BiggerPockets for investor networking and deal sourcing. Local property management companies such as Vacasa and RedAwning offer turnkey Airbnb management services in the Round Lake area, while investment-focused brokerages like eXp Realty and Century 21 have agents experienced in short-term rental acquisitions throughout Lake County, Illinois.