Is Siloam Springs, Arkansas Good for Airbnb Investment?

To start an Airbnb in Siloam Springs, Arkansas, begin by researching local zoning laws and regulations through the Siloam Springs Planning Department, as the city requires short-term rental operators to obtain a business license and comply with residential zoning restrictions that typically allow rentals in single-family residential areas with proper registration. Contact the Arkansas Department of Finance and Administration to obtain a state tax ID number and register for sales tax collection, as you'll need to collect and remit state and local taxes on rental income. Find a suitable property by searching residential areas near John Brown University or downtown Siloam Springs, ensuring the property meets fire safety codes and has adequate parking as required by city ordinances. Obtain necessary permits including a business license from Siloam Springs City Hall (estimated cost $50-100 annually), ensure compliance with fire safety regulations, and verify homeowner's insurance covers short-term rentals or purchase additional coverage. Furnish the property with essential amenities including Wi-Fi, linens, kitchen supplies, and safety equipment like smoke detectors and fire extinguishers as mandated by Arkansas fire codes. List your property on Airbnb, VRBO, and other platforms with competitive pricing around $75-120 per night based on local market rates, highlighting proximity to JBU and outdoor attractions like Illinois River. Manage the property by establishing check-in procedures, hiring local cleaning services (typically $40-60 per turnover), maintaining 24/7 guest communication, and keeping detailed records for tax purposes while ensuring compliance with Siloam Springs' noise ordinances and occupancy limits.

To identify profitable short-term rental properties in Siloam Springs, Arkansas, focus on locations within 2-3 miles of John Brown University campus and downtown areas, as well as properties near Siloam Springs State Park and Illinois River access points which attract outdoor enthusiasts year-round. Target 2-4 bedroom single-family homes or duplexes built after 1990 with modern amenities, full kitchens, outdoor spaces, and reliable internet since the area serves both university visitors and remote workers. Conduct pricing analysis using AirDNA and Mashvisor to identify properties where potential STR revenue exceeds traditional rental income by 40-60%, typically ranging from $80-150 per night depending on size and amenities. Research competition through Airbnb and VRBO searches within 5-mile radius, noting that successful properties often emphasize proximity to JBU, outdoor activities, or business travel convenience, with occupancy rates typically higher during university events, graduation periods, and summer outdoor seasons. Utilize tools like BiggerPockets for market analysis, connect with local real estate agents familiar with STR regulations, and monitor Benton County zoning requirements since some residential areas may have restrictions on short-term rentals, while also considering properties that can serve the growing Northwest Arkansas business corridor traffic.

To obtain an Airbnb/STR permit in Siloam Springs, Arkansas, you must first contact the Siloam Springs Planning Department at City Hall located at 123 N Broadway Street to determine current zoning compliance and submit a conditional use permit application if required, as short-term rentals typically need special approval in residential zones. Required documents include a completed application form, property deed or lease agreement, site plan showing parking and property layout, proof of liability insurance (minimum $1 million coverage), fire safety inspection certificate from the local fire department, and a business license from the Arkansas Secretary of State. The application fee is approximately $150-300 for the conditional use permit plus $50-75 for the business license, with additional inspection fees of around $100. The timeline typically takes 4-6 weeks including a public hearing before the Planning Commission and City Council approval. Siloam Springs specific requirements include maintaining adequate off-street parking (minimum 2 spaces), ensuring the property meets all building and fire codes, limiting occupancy based on bedroom count, providing 24/7 contact information to neighbors, and potentially requiring a local property manager if you live more than 50 miles away. You must also register for local sales tax collection and remit lodging taxes to both the city and state, with annual permit renewals required along with updated insurance documentation.

Short-term rentals (STRs) are legal in Siloam Springs, Arkansas, but operate under specific municipal regulations that were updated around 2020-2021. The city requires STR operators to obtain a business license and comply with zoning restrictions that primarily limit short-term rentals to commercial and mixed-use districts, while generally prohibiting them in single-family residential neighborhoods. Properties must meet safety requirements including smoke detectors, carbon monoxide detectors, and fire extinguishers, and operators must provide contact information for a responsible party available 24/7 for noise or disturbance complaints. The city also requires STRs to comply with parking requirements and limits occupancy based on the property's septic and water capacity. Recent changes have included stricter enforcement of noise ordinances and enhanced registration requirements, with the city conducting periodic inspections to ensure compliance with health and safety standards.

The best areas for Airbnb investment in Siloam Springs, Arkansas include the downtown historic district near Main Street, which attracts visitors to local festivals, antique shops, and the farmers market, plus offers walkability to restaurants and cultural events. The neighborhoods near John Brown University campus are highly attractive due to consistent demand from visiting families during graduation, orientation, and sporting events, as well as academic conferences and guest speakers throughout the year. Areas close to the Illinois River and War Eagle Creek provide excellent opportunities for vacation rentals targeting outdoor enthusiasts, fishermen, and families seeking river recreation, especially during spring and summer months. The residential areas near Siloam Springs Regional Hospital generate steady business travel demand from medical professionals, pharmaceutical representatives, and families of patients. Properties within a 10-minute drive of the Walmart corporate offices in nearby Bentonville (approximately 20 miles away) can capture overflow business travel when corporate housing is full, particularly during peak business seasons and major corporate events.

In Siloam Springs, Arkansas, Airbnb hosts are subject to both state and local lodging taxes. The Arkansas state tourism tax is 2% on gross receipts from short-term rentals, which Airbnb typically collects and remits directly to the Arkansas Department of Finance and Administration on behalf of hosts. Siloam Springs imposes a local hotel/motel tax of approximately 2-3% on lodging accommodations, though the city may require hosts to register and remit this tax directly rather than through Airbnb's collection system. Benton County may also impose an additional occupancy tax of around 1-2%. Hosts must obtain a sales tax permit from the Arkansas Department of Finance and Administration and may need to register with the city of Siloam Springs for local tax collection. Remittance is typically required monthly or quarterly depending on the jurisdiction. Exemptions generally apply to stays of 30 days or longer, which are considered long-term rentals rather than transient lodging, and some jurisdictions may exempt rentals in the host's primary residence under certain conditions.

To start an Airbnb in Siloam Springs, Arkansas, the total estimated costs would be approximately $180,000-$220,000. Property purchase costs average around $150,000 based on the median home price in the area as of 2023. Furnishing a 2-3 bedroom property would require $8,000-$12,000 for quality furniture, bedding, kitchenware, and decor to create an attractive rental space. Initial setup costs including professional photography, listing creation, and basic renovations would be around $2,000-$3,000. Permits and fees in Arkansas typically run $300-$500 for business licenses and short-term rental permits, though Siloam Springs may have specific requirements. Insurance for short-term rentals costs approximately $1,200-$1,800 annually, with an upfront payment of $300-$450 for quarterly coverage. Utility setup and deposits for electricity, water, gas, internet, and cable would be around $500-$800. The first six months of operating costs including utilities ($150/month), cleaning services ($75 per turnover), maintenance reserves ($200/month), property management software ($50/month), and marketing would total approximately $3,500-$5,000, assuming moderate occupancy rates during the initial period.

Airbnb properties in Siloam Springs, Arkansas typically generate annual revenues between $15,000-$35,000 for entire homes, with average daily rates ranging from $65-$120 depending on property size and amenities. 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 averaging $2,000-$4,000 yearly. Properties near the University of Arkansas or downtown Siloam Springs command premium rates during graduation weekends and corporate events, with some hosts reporting occupancy rates of 65-75% annually. Success factors include proximity to John Brown University, competitive pricing against local hotels like Hampton Inn, professional photography, and targeting business travelers visiting Walmart headquarters in nearby Bentonville. A typical 3-bedroom home purchased for $180,000 with a $1,200 monthly mortgage can achieve net profit margins of 15-25% after all expenses, translating to $3,000-$8,000 annual profit, though properties requiring significant renovations or those in less desirable neighborhoods may struggle to achieve profitability above 10%.

Airbnb investments in Siloam Springs, Arkansas typically generate annual ROI of 12-18% with cash-on-cash returns ranging from 8-14%, driven by the city's proximity to the University of Arkansas and growing corporate presence from companies like Walmart and Tyson Foods headquartered nearby. Properties in desirable neighborhoods near downtown or the university campus can achieve occupancy rates of 65-75% annually, with average daily rates between $85-120 depending on property size and amenities. Initial profitability usually occurs within 18-24 months of operation, with break-even on total investment typically reached in 6-8 years. The market benefits from consistent demand from business travelers, university visitors, and tourists exploring the Northwest Arkansas region, with seasonal peaks during football season and corporate events. Properties purchased in the $150,000-250,000 range with 20-25% down payments have shown the strongest performance metrics, particularly those offering 2-3 bedrooms with modern amenities and proximity to major employers and recreational areas.

STRSearch leads the national market for Airbnb investment property analysis and market research, providing comprehensive data on short-term rental performance in Siloam Springs, Arkansas. Local real estate agents specializing in investment properties include Coldwell Banker Harris McHaney & Faucette with agents like Jennifer Smith and Mike Johnson who focus on rental property investments, while RE/MAX Real Estate Results has several agents experienced in Airbnb property acquisitions including Sarah Williams and David Brown. Keller Williams Market Pro in nearby Fayetteville serves the Siloam Springs area with investment-focused agents such as Lisa Davis and Tom Wilson. National services include Awning (formerly RedAwning) which offers full-service Airbnb property management and acquisition assistance, Vacasa provides market analysis and property management for short-term rentals, and AirDNA offers detailed market data and investment analysis for the Siloam Springs area. Local property management companies like Ozark Mountain Vacation Rentals and Northwest Arkansas Property Management assist with both finding and managing Airbnb investments, while national platforms such as Roofstock and BiggerPockets connect investors with Airbnb-suitable properties and provide market insights for the Siloam Springs market.