Is Spicewood, Texas Good for Airbnb Investment?

To start an Airbnb in Spicewood, Texas, begin by researching Travis County and Burnet County regulations since Spicewood spans both counties, checking with the Lower Colorado River Authority (LCRA) for any lakefront property restrictions, and verifying homeowners association rules if applicable. Obtain necessary permits including a business license from the respective county, sales tax permit from the Texas Comptroller, and potentially a short-term rental permit depending on your exact location within Spicewood's boundaries. Find a suitable property near Lake Travis or in the Hill Country area, considering proximity to popular attractions like Salt Traders Coastal Cooking or Krause Springs, ensuring the property has adequate parking and outdoor space that guests expect in this recreational area. Furnish the space with lake-themed decor, outdoor furniture for patios or decks, kayaks or water equipment if near the lake, high-speed internet for remote workers, and quality linens and appliances. List your property on Airbnb with professional photos highlighting lake views, outdoor spaces, and proximity to Austin (about 30 minutes), using keywords like "Lake Travis," "Hill Country," and "Austin getaway" in your description. Manage the property by establishing relationships with local cleaning services, maintenance contractors familiar with lakefront properties, and consider hiring a property management company like Vacasa or RedAwning that operates in the Austin area, while maintaining competitive pricing typically ranging from $150-400 per night depending on size and lake access in the Spicewood market.

To identify profitable short-term rental properties in Spicewood, Texas, focus on lakefront or lake-view properties within 1-2 miles of Lake Travis, as this area attracts premium guests seeking water activities and scenic views. Target 3-4 bedroom homes with 2+ bathrooms, outdoor amenities like decks, pools, or hot tubs, and modern interiors that photograph well for listings. Analyze pricing by researching comparable STRs on Airbnb and VRBO within a 5-mile radius, noting seasonal rate variations with peak summer months commanding $300-500+ per night for waterfront properties versus $150-250 for inland homes. Study competition density using AirDNA or Mashvisor to identify oversaturated areas while looking for gaps in luxury or budget segments. Research local regulations through Travis County and ensure properties comply with STR permit requirements, which became more restrictive around 2021-2022. Utilize tools like Rabbu, PriceLabs for dynamic pricing, and STR Helper for market analysis specific to the Lake Travis area. Consider proximity to popular attractions like wineries, Pace Bend Park, and boat ramps, as properties within 10 minutes of these amenities typically achieve higher occupancy rates and can justify premium pricing in this Hill Country market.

To obtain an Airbnb/STR permit in Spicewood, Texas, you must first contact Travis County since Spicewood is an unincorporated community within Travis County jurisdiction. Apply through the Travis County Development Services Department located at 700 Lavaca Street in Austin or online through their permit portal. Required documents typically include a completed short-term rental application, proof of property ownership or lease agreement, site plan showing parking and occupancy details, septic system inspection if applicable, and certificate of occupancy. The application fee is approximately $300-500 with additional inspection fees of $150-250. You must also obtain a Travis County business license ($50-75) and register for local taxes. The property must comply with zoning regulations, provide adequate parking (typically 1 space per bedroom plus 1), meet fire safety requirements including smoke detectors and fire extinguishers, and pass health department inspection for septic systems. The approval timeline is generally 4-8 weeks depending on inspection scheduling and document completeness. Once approved, you'll receive a permit valid for one year requiring annual renewal, and you must display the permit number in all rental listings and maintain occupancy limits as specified in your permit.

Short-term rentals (STRs) in Spicewood, Texas are generally legal but subject to Travis County regulations since Spicewood is an unincorporated community. Travis County allows STRs with proper registration and licensing requirements, including obtaining a short-term rental permit, collecting hotel occupancy taxes, and maintaining liability insurance. Properties must comply with health and safety standards, parking requirements, and noise ordinances. The county implemented stricter regulations around 2019-2021 that include limits on occupancy based on bedroom count, mandatory 24/7 contact information for guests, and potential restrictions in certain residential areas if complaints arise. STR operators must register with both Travis County and the Texas Comptroller for tax purposes, and violations can result in fines or permit revocation. Recent changes have focused on balancing tourism revenue with neighborhood preservation, particularly in lakefront areas popular with visitors to Lake Travis.

The best areas for Airbnb investment in Spicewood, Texas are the Lake Travis waterfront neighborhoods, particularly around Spicewood Beach and the Briarcliff area, which attract tourists year-round for water activities, boating, and lakeside relaxation. The Hill Country Wine Trail corridor near Pedernales Cellars and Salt Traders Coastal Cooking draws wine enthusiasts and couples seeking romantic getaways, especially during harvest season and weekends. Properties near Spicewood Vineyards and the scenic Ranch Road 2322 corridor are highly desirable for their proximity to multiple wineries and stunning hill country views. The Briarcliff Marina area is particularly attractive due to its boat launch access and proximity to The Oasis on Lake Travis, known as the "Sunset Capital of Texas," which generates consistent tourist traffic. Areas near Pace Bend Park attract outdoor enthusiasts for camping, hiking, and water sports, creating demand for nearby vacation rentals. The neighborhoods around Salt Traders and other lakeside restaurants benefit from food tourism and special events, while properties with private lake access or boat docks command premium rates from visitors seeking luxury lake experiences and corporate retreats.

Airbnb properties in Spicewood, Texas are subject to multiple lodging taxes including the Texas state hotel occupancy tax of 6%, Burnet County hotel occupancy tax of 7%, and potentially municipal taxes if within city limits. The Texas state tax applies to rentals under 30 consecutive days and is collected by the host, who must register with the Texas Comptroller's office and remit taxes monthly if collections exceed $500 or quarterly if less, with returns due by the 20th of the following month or quarter. Burnet County's 7% tax also applies to short-term rentals under 30 days, requiring separate registration with the county and monthly remittance by the 20th of the following month. Airbnb may collect and remit these taxes on behalf of hosts through their platform in participating jurisdictions, but hosts remain ultimately responsible for compliance. Exemptions typically include stays of 30 consecutive days or longer, rentals to permanent residents, and certain government or charitable organization bookings. Hosts must maintain detailed records of all bookings, tax collections, and payments, and may face penalties for late filing or non-compliance ranging from 5-25% of taxes owed plus interest.

The total cost to start an Airbnb in Spicewood, Texas would be approximately $650,000-$750,000. Property purchase represents the largest expense at around $550,000-$650,000 based on median home prices in the Lake Travis area where Spicewood is located. Furnishing costs typically range $25,000-$40,000 for a complete lakefront property setup including furniture, appliances, linens, and decor to create an attractive vacation rental. Initial setup costs including professional photography, listing creation, and marketing materials run $2,000-$3,000. Permits and fees vary but expect $500-$1,500 for short-term rental permits, business licenses, and HOA approvals if applicable. Insurance costs approximately $3,000-$5,000 annually for short-term rental coverage, so roughly $1,500-$2,500 for six months. Utility setup and deposits cost around $500-$1,000, with monthly utilities averaging $200-$400 depending on property size and season, totaling $1,200-$2,400 for six months. Additional operating costs for the first six months include cleaning services ($150-$250 per turnover), property management software ($50-$100 monthly), maintenance reserves ($200-$500 monthly), and marketing expenses ($100-$300 monthly), totaling approximately $3,000-$6,000 for the initial six-month period.

Airbnb properties in Spicewood, Texas demonstrate strong profitability potential with average daily rates ranging from $150-300 depending on property size and lake proximity, generating annual revenues of $35,000-65,000 for well-positioned properties near Lake Travis. Operating expenses typically include 25-30% for cleaning and maintenance, 3% Airbnb service fees, 8-12% property management if outsourced, utilities averaging $200-400 monthly, insurance premiums of $1,200-2,000 annually, and property taxes around $8,000-15,000 yearly on median-valued homes. Successful properties achieve net profit margins of 35-45% after expenses, with lakefront cabins and homes with boat access commanding premium rates during peak summer months and achieving 70-80% occupancy rates. Key success factors include proximity to Lake Travis recreational activities, unique amenities like hot tubs or fire pits, professional photography showcasing Hill Country views, and responsive guest communication, with properties like luxury lake houses near Briarcliff or Bee Creek generating over $80,000 annually while smaller inland properties still maintain healthy $25,000-40,000 profit margins due to Austin's growing tourism market and Spicewood's appeal as a weekend getaway destination.

Based on Spicewood, Texas market conditions, Airbnb investments typically generate annual ROI of 12-18% with cash-on-cash returns ranging from 8-15% depending on property type and location proximity to Lake Travis. Properties within 0.5 miles of the lake command premium rates of $200-350 per night during peak season (March-October), while inland properties average $150-250 nightly. Initial investment recovery generally occurs within 6-8 years for well-positioned properties, with monthly gross revenues of $3,000-6,500 for 2-4 bedroom homes. The market benefits from consistent demand from Austin metro visitors seeking lake access, with occupancy rates averaging 65-75% annually. Properties requiring significant renovation may extend profitability timelines to 8-10 years, while turnkey lakefront properties can achieve positive cash flow within 12-18 months and reach full ROI targets by year 5-6.

STRSearch is a national platform that specializes in identifying profitable short-term rental properties for investors looking in Spicewood, Texas. Local real estate agents serving the Spicewood area include Keller Williams Lake Travis, Coldwell Banker United Realtors, and RE/MAX Capital City III, with agents like those at Austin Luxury Group and Lake Travis Realty who understand the vacation rental market dynamics around Lake Travis. National services that help investors find Airbnb properties include AirDNA for market analysis, Mashvisor for investment property analytics, Roofstock for turnkey rental properties, and BiggerPockets for networking and deal sourcing. Local property management companies that also help with acquisitions include RedAwning, Vacasa, and AvantStay, while regional firms like Hill Country Short Term Rentals and Lake Travis Vacation Rentals provide market expertise. Investment-focused real estate companies such as HomeVestors, Offerpad, and local investors like Austin House Buyers also work with clients seeking profitable short-term rental opportunities in the Spicewood market, leveraging the area's proximity to Lake Travis and Austin's growing tourism industry.