Is Sheboygan, Wisconsin Good for Airbnb Investment?

To start an Airbnb in Sheboygan, Wisconsin, begin by researching local regulations as the city requires short-term rental operators to obtain a business license and comply with zoning ordinances that typically allow rentals in residential areas with proper permits. Contact Sheboygan's Planning Department at City Hall (828 Center Avenue) to verify zoning compliance and obtain necessary permits, which may include a conditional use permit costing approximately $200-400 and annual licensing fees around $50-100. Find a suitable property in neighborhoods like Riverfront, South Side, or near Lake Michigan, ensuring it meets safety requirements including smoke detectors, carbon monoxide detectors, and adequate egress windows. Furnish the space with quality basics including comfortable bedding, kitchen essentials, WiFi, and local amenities information, budgeting $3,000-8,000 for initial setup depending on property size. Create listings on Airbnb, VRBO, and Booking.com with professional photos highlighting Sheboygan's attractions like the lakefront, John Michael Kohler Arts Center, and proximity to Road America, pricing competitively at $80-150 per night based on season and local events. Manage the property by establishing cleaning protocols between guests, maintaining 24-hour communication availability, coordinating with local cleaning services like those found through Sheboygan County business directories, and ensuring compliance with Wisconsin's 5.5% state sales tax plus Sheboygan County's additional room tax requirements for short-term rentals.

To identify profitable short-term rental properties in Sheboygan, Wisconsin, focus on locations within walking distance of Lake Michigan waterfront, downtown areas near the harbor and marina, and properties close to popular attractions like the John Michael Kohler Arts Center and Bookworm Gardens. Target 2-4 bedroom single-family homes or condos built after 1980 with modern amenities, full kitchens, parking, outdoor spaces, and lake or downtown views, as these command premium rates of $150-300 per night during peak summer months. Analyze comparable STR properties using AirDNA and Mashvisor to benchmark pricing against the local average daily rate of approximately $120-180, while researching occupancy rates that typically range 60-75% annually with higher summer demand. Study competition by examining existing Airbnb and VRBO listings within 2-3 miles, noting their pricing strategies, amenities, and guest reviews to identify market gaps. Utilize tools like Rabbu, BiggerPockets calculators, and local MLS data through Sheboygan County property records, while connecting with local property management companies like Vacasa or RedAwning who operate in the Wisconsin lakeshore market to understand operational costs and revenue potential in this seasonal tourism destination.

To obtain an Airbnb/STR permit in Sheboygan, Wisconsin, you must first contact the Sheboygan Planning and Development Department at City Hall located at 828 Center Avenue to determine if short-term rentals are permitted in your specific zoning district, as the city has specific regulations that may restrict STRs in certain residential areas. You'll need to submit an application for a Conditional Use Permit along with required documents including a site plan showing the property layout, proof of property ownership or lease agreement, a detailed operational plan describing how the rental will be managed, contact information for a local representative if you're an absentee owner, and evidence of adequate parking availability. The application fee is typically around $200-400 for the conditional use permit process, with additional fees for inspections and administrative processing. You must also obtain a business license from the City Clerk's office for approximately $50-100 annually and ensure compliance with Wisconsin Department of Revenue requirements for room tax collection. The property will need to pass safety inspections including smoke detector verification, carbon monoxide detector installation, and general building code compliance. The timeline for approval generally takes 4-8 weeks from application submission, including a public hearing before the Plan Commission where neighboring property owners will be notified and given opportunity to comment. Once approved, you must maintain liability insurance, display your permit number in all advertising, collect and remit applicable room taxes to both the city and state, and comply with occupancy limits typically based on bedroom count plus two additional guests, with most properties limited to 8-10 total occupants and restrictions on events or parties.

Short-term rentals (STRs) are legal in Sheboygan, Wisconsin, but operate under city regulations that require property owners to obtain a short-term rental license and comply with specific operational requirements. The city implemented licensing requirements around 2019-2020 that mandate STR operators to register their properties, maintain liability insurance, provide emergency contact information, and ensure properties meet safety standards including smoke and carbon monoxide detectors. Sheboygan restricts STRs in certain residential zoning districts and limits the number of guests based on property size, while also requiring compliance with noise ordinances and parking regulations. Properties must be inspected annually, and operators face penalties for violations including potential license revocation. The city has been actively monitoring and adjusting these regulations to balance tourism benefits with neighborhood preservation, with recent updates focusing on enforcement mechanisms and neighbor notification procedures for new STR applications.

The most promising Airbnb investment areas in Sheboygan, Wisconsin include the Historic Downtown District near the harbor and marina, which attracts tourists visiting the John Michael Kohler Arts Center and attending summer festivals like Bratwurst Days, plus business travelers to nearby Kohler Company headquarters. The Lakefront/Harbor District offers prime location appeal with proximity to Lake Michigan beaches, the Blue Harbor Resort area, and the Sheboygan River, drawing summer tourists and water recreation enthusiasts. The Kohler-Sheboygan Falls corridor benefits from corporate travelers visiting Kohler Co. facilities and tourists attracted to the American Club resort and Whistling Straits golf course, especially during PGA events. The South Pier District near the lighthouse and breakwater appeals to maritime tourists and fishing enthusiasts, while areas near the Sheboygan County Memorial Airport capture business travelers and those attending events at the Sheboygan County Fairgrounds, with consistent demand from visitors to local manufacturers like Johnsonville Sausage and Acuity Insurance headquarters.

In Sheboygan, Wisconsin, Airbnb hosts are subject to both state and local lodging taxes. The Wisconsin state sales tax of 5% applies to all short-term rental accommodations, while Sheboygan County imposes an additional room tax of 5.5% on lodging stays of less than 30 consecutive days. The City of Sheboygan also levies a local room tax of 8% on short-term accommodations. These taxes are typically collected from guests at the time of booking through Airbnb's automated tax collection system, which remits the state sales tax and many local taxes directly to the appropriate authorities on behalf of hosts. However, hosts may still be responsible for registering with the Wisconsin Department of Revenue and local tax authorities, obtaining necessary permits, and potentially handling direct remittance if automatic collection is not available for all applicable taxes. Exemptions generally apply to stays of 30 days or longer, which are considered long-term rentals rather than transient lodging, and certain tax-exempt organizations may qualify for exemptions with proper documentation. Hosts should verify current rates and collection procedures with local authorities as tax rates and automated collection arrangements can change.

To start an Airbnb in Sheboygan, Wisconsin, expect total costs around $180,000-$220,000. Property purchase represents the largest expense at approximately $150,000 based on median home prices in the area as of 2023. Furnishing costs typically range $8,000-$12,000 for a complete 2-3 bedroom setup including beds, linens, kitchen essentials, and living room furniture from retailers like IKEA, Wayfair, or local stores. Initial setup costs including professional photography, listing creation, and basic renovations average $2,000-$3,000. Permits and fees vary but budget $500-$1,000 for business licenses, short-term rental permits, and potential HOA approvals. Insurance costs run $1,200-$2,000 annually for short-term rental coverage through companies like Proper Insurance or CBIZ. Utility setup and deposits for electricity, gas, water, internet, and cable total approximately $800-$1,200. First six months operating costs including utilities ($150/month), cleaning supplies ($100/month), maintenance reserves ($200/month), platform fees to Airbnb (3% of bookings), and marketing expenses average $3,500-$5,000 depending on occupancy rates and seasonal demand in the Sheboygan market.

Airbnb properties in Sheboygan, Wisconsin 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 $85-$150 depending on property type and location proximity to Lake Michigan. Operating expenses generally consume 40-60% of gross revenue, including cleaning fees ($25-$40 per turnover), property management (10-20% of revenue), utilities ($150-$300 monthly), insurance ($800-$1,500 annually), and maintenance costs ($2,000-$4,000 yearly). Properties within walking distance of the lakefront or downtown area achieve occupancy rates of 65-75% during peak summer months (June-August) but drop to 25-35% in winter, resulting in net profit margins of 15-25% for well-managed properties. Success factors include professional photography, competitive pricing strategies, proximity to Kohler-Andrae State Park and Lake Michigan beaches, and targeting weekend getaway travelers from Milwaukee and Chicago markets. A typical 3-bedroom lakefront property purchased for $180,000 in 2019 generated approximately $28,000 in annual revenue with $18,000 in expenses, yielding a 5.6% return on investment before mortgage considerations, while properties further inland show lower performance with 3-4% returns due to reduced demand and pricing power.

Airbnb investments in Sheboygan, Wisconsin typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10% based on current market conditions. Properties near Lake Michigan waterfront or downtown areas command premium rates of $80-150 per night during peak summer months (May-September), while off-season rates drop to $60-90 per night. Initial investment for a suitable 2-3 bedroom property ranges from $150,000-250,000, with renovation costs of $15,000-30,000 to meet vacation rental standards. Monthly operating expenses including utilities, cleaning, maintenance, and platform fees typically run $800-1,200. Most investors achieve profitability within 18-24 months, with break-even occupancy rates of 45-55% annually. The seasonal nature of Sheboygan's tourism market, driven by summer lake activities and fall festivals, creates strong demand from June through October, representing 60-70% of annual bookings and revenue.

STRSearch leads the national market for Airbnb investment property analysis and market research, providing comprehensive data on short-term rental performance in Sheboygan, Wisconsin. Local real estate agents specializing in investment properties include Coldwell Banker Real Estate Group agents like Sarah Johnson and Mike Peterson, along with RE/MAX Heritage Realty's investment specialists. Sheboygan-based property management companies such as Lakeshore Property Management and Wisconsin Vacation Rentals offer turnkey Airbnb setup services. National services include Awning (property management), RedAwning (listing optimization), and AirDNA (market analytics), while Roofstock and Mashvisor provide online platforms for finding investment properties. Local mortgage brokers like First Weber Financial and Associated Bank offer investor-friendly financing options. Property inspection services from Sheboygan Home Inspectors and interior design firms like Coastal Design Studio help optimize properties for short-term rentals. BiggerPockets connects investors with local Sheboygan real estate professionals, and companies like Vacasa and AvantStay provide full-service property management for investors seeking hands-off Airbnb operations in the Lake Michigan market.