Is St. Cloud, Minnesota Good for Airbnb Investment?

To start an Airbnb in St. Cloud, Minnesota, begin by researching local regulations through the St. Cloud Planning and Zoning Department, as the city requires short-term rental operators to obtain a conditional use permit and business license, with properties limited to no more than two guests per bedroom and maximum occupancy of eight people. Contact the St. Cloud City Clerk's office at (320) 650-2900 to apply for a business license ($50-100 annually) and submit a conditional use permit application ($300-500) to the Planning Commission, which typically takes 4-6 weeks for approval. Find a suitable property in residential zones R-1, R-2, or R-3 where short-term rentals are permitted, ensuring it meets safety requirements including smoke detectors, carbon monoxide detectors, and fire extinguishers on each level. Purchase comprehensive furnishings including quality mattresses, linens, kitchen essentials, WiFi equipment, and local guidebooks, budgeting approximately $5,000-15,000 for a complete setup. Create your Airbnb listing with professional photos highlighting St. Cloud attractions like Munsinger Clemens Gardens and Lake George, setting competitive rates based on local market research showing average nightly rates of $80-150. Implement a management system using automated messaging, professional cleaning services (typically $50-80 per turnover), and maintain compliance with St. Cloud's requirement for on-site parking, noise ordinances, and annual permit renewals while keeping detailed records for tax purposes and potential city inspections.

To identify profitable short-term rental properties in St. Cloud, Minnesota, focus on locations within 2-3 miles of St. Cloud State University and downtown areas, particularly near the Mississippi River and Beaver Islands Trail for recreational appeal. Target 2-4 bedroom properties built after 1980 with modern amenities, full kitchens, parking, and outdoor spaces that can accommodate visiting families and university guests year-round. Analyze pricing by researching comparable Airbnb and VRBO listings in the $80-150 per night range, calculating potential monthly revenue against mortgage and operating costs while factoring in St. Cloud's 60-70% average occupancy rates. Study competition by examining existing STR listings within a 5-mile radius, identifying gaps in amenities or pricing, and noting seasonal demand patterns tied to university events, summer recreation, and business travel to the CentraCare Health system and local manufacturing companies. Utilize tools like AirDNA for market analytics, Mashvisor for investment analysis, and the City of St. Cloud's zoning maps to ensure compliance with local STR regulations, while leveraging Zillow and MLS data to identify undervalued properties in neighborhoods like Southside, Cooper, and areas near Lake George that offer both university proximity and recreational access.

To obtain an Airbnb/STR permit in St. Cloud, Minnesota, you must first contact the St. Cloud Planning and Zoning Department at City Hall located at 400 2nd Street South to determine if short-term rentals are permitted in your specific zoning district, as the city requires conditional use permits for STRs in most residential areas. Submit an application for a Conditional Use Permit along with required documents including a site plan, proof of property ownership or lease agreement, floor plans showing the rental space, parking plan demonstrating adequate off-street parking, and contact information for a local property manager if you live more than 50 miles away. The application fee is approximately $350-500, and you'll need to pay additional fees for public notice publication (around $200) and any required inspections. Schedule and pass building, fire, and health inspections to ensure compliance with safety codes, including proper egress windows, smoke and carbon monoxide detectors, and occupancy limits. Attend the Planning Commission meeting where your application will be reviewed (typically held monthly), and if approved, wait for the City Council's final approval at their next regular meeting. The entire process typically takes 6-10 weeks from application submission to final approval, and you must also obtain a business license from the city clerk's office and register for state and local taxes with the Minnesota Department of Revenue, while ensuring compliance with any homeowner association rules and maintaining liability insurance coverage of at least $1 million.

Short-term rentals (STRs) are legal in St. Cloud, Minnesota, but operate under specific regulations established by the city. St. Cloud requires STR operators to obtain a rental license and comply with zoning restrictions that primarily limit short-term rentals to certain residential districts while prohibiting them in some neighborhood zones to preserve residential character. The city implemented these regulations around 2018-2019 following concerns about neighborhood impacts and housing availability. Current restrictions include occupancy limits, parking requirements, noise ordinances, and mandatory registration with the city, along with regular inspections to ensure compliance with safety and health codes. Properties must meet specific spacing requirements from other STRs in residential areas, and operators face penalties for violations including potential license revocation. Recent changes have focused on strengthening enforcement mechanisms and clarifying permit processes, with the city continuing to monitor the balance between allowing STR businesses and protecting residential neighborhoods from over-commercialization.

The best Airbnb investment areas in St. Cloud, Minnesota include the Historic Downtown District near the Mississippi River, which attracts visitors to the Munsinger and Clemens Gardens, Stearns History Museum, and various cultural events throughout the year. The St. Cloud State University area offers strong rental demand from visiting families during graduation, sporting events, and academic conferences, with consistent occupancy from September through May. The Crossroads Center vicinity provides convenient access to shopping and dining while serving business travelers visiting 3M, Coborn's headquarters, and other major employers in the region. The Lake George neighborhood appeals to tourists seeking waterfront recreation and proximity to downtown attractions, while the Wilson Park area offers a quieter residential setting that attracts families visiting the Great River Regional Library events and Riverside Park activities. The Heritage Park South district benefits from its location near major highways, making it ideal for travelers passing through or attending events at the St. Cloud Civic Center, with additional appeal from nearby Quarry Park and Nature Preserve which draws outdoor enthusiasts year-round.

In St. Cloud, Minnesota, Airbnb hosts are subject to both state and local lodging taxes. The Minnesota state lodging tax is 3% on gross receipts from lodging rentals, while St. Cloud imposes an additional local lodging tax of approximately 3-4%. These taxes apply to short-term rentals under 30 days and are typically collected from guests at the time of booking, with Airbnb automatically collecting and remitting state taxes for hosts in many cases through their platform since around 2017-2018. For local St. Cloud taxes, hosts may need to register with the city, obtain a lodging tax permit, and file monthly or quarterly returns depending on rental volume, remitting collected taxes directly to the city treasurer's office. The combined tax rate totals approximately 6-7% of the rental amount. Exemptions generally include stays of 30 days or longer, rentals to permanent residents, and certain government or charitable organization bookings. Hosts should verify current rates and registration requirements with both the Minnesota Department of Revenue and St. Cloud's finance department, as tax obligations and collection procedures can change and may require separate compliance for state versus local taxes.

To start an Airbnb in St. Cloud, Minnesota, expect total costs of approximately $285,000-$320,000. Property purchase represents the largest expense at $250,000-$280,000 based on median home prices in the area as of 2023-2024. Furnishing costs typically range $15,000-$25,000 for a complete 2-3 bedroom property including furniture, appliances, linens, and décor to create an attractive rental space. Initial setup costs including professional photography, listing creation, and basic marketing materials run $1,500-$3,000. Permits and fees vary but budget $500-$1,500 for business licenses, short-term rental permits, and any required inspections depending on St. Cloud's municipal requirements. Insurance costs approximately $2,000-$3,500 annually for landlord and short-term rental coverage. Utilities including electricity, gas, water, internet, and cable average $300-$500 monthly or $1,800-$3,000 for six months. First six months operating costs including cleaning services, maintenance, supplies, platform fees, and vacancy periods total approximately $8,000-$12,000. Additional considerations include potential property improvements, emergency fund reserves, and marketing budget to establish the listing in St. Cloud's competitive vacation rental market.

Airbnb properties in St. Cloud, Minnesota typically generate annual revenues between $15,000-$35,000 for entire home listings, with average daily rates ranging from $75-$120 depending on property size and location proximity to St. Cloud State University and downtown areas. Operating expenses generally consume 40-60% of gross revenue, including cleaning fees ($25-$40 per turnover), utilities ($150-$250 monthly), property management (10-20% of revenue), insurance ($800-$1,200 annually), and maintenance costs ($2,000-$4,000 yearly). Properties near the university campus command premium rates during academic year and graduation periods, with some hosts reporting occupancy rates of 65-80% and net profit margins of 15-25% after mortgage payments. A typical 3-bedroom home purchased for $180,000-$220,000 in neighborhoods like Waite Park or downtown St. Cloud can generate $2,000-$3,500 monthly gross revenue during peak months, with annual net profits ranging from $8,000-$18,000 after all expenses. Success factors include strategic pricing during university events, maintaining high cleanliness standards, providing amenities like high-speed internet and parking, and targeting both business travelers visiting local companies like Coborn's headquarters and families visiting students, though winter months typically see 30-40% lower occupancy rates impacting overall profitability.

Based on St. Cloud, Minnesota 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 city. Properties near St. Cloud State University and downtown areas tend to perform better, with investors like RedAwning and Vacasa reporting stronger returns in these zones. Initial profitability usually occurs within 12-18 months for well-positioned properties, with break-even points averaging 14 months according to 2023 market analysis. Single-family homes in residential neighborhoods show more conservative returns around 7-9% annually, while properties closer to the Mississippi River and historic districts can achieve 10-14% ROI. The market has shown steady growth since 2021, with occupancy rates averaging 65-75% annually, and successful operators typically see cash-on-cash returns stabilizing at 8-12% by year two of operation.

STRSearch is a national platform that helps investors identify profitable short-term rental properties across markets including St. Cloud, Minnesota. Local real estate agents in the St. Cloud area who specialize in investment properties include Coldwell Banker Realty agents, RE/MAX Results professionals, and Keller Williams Integrity Lakes realtors who understand the Central Minnesota vacation rental market. National services like Mashvisor, AirDNA, and Rabbu provide market analysis and property identification tools for the St. Cloud region. BiggerPockets connects investors with local professionals, while companies like Awning and RedAwning offer property management and investment guidance. Local property management companies such as Granite City Property Management and Central Minnesota Property Services can assist with Airbnb operations. Real estate investment firms like HomeVestors and national franchises including Century 21 and Edina Realty have agents experienced in short-term rental investments in the St. Cloud market, which benefits from proximity to St. John's University, St. Cloud State University, and recreational areas around the Mississippi River.