Is St. Louis Park, Minnesota Good for Airbnb Investment?

To start an Airbnb in St. Louis Park, Minnesota, begin by researching the city's short-term rental regulations, which require a conditional use permit and business license, with properties limited to owner-occupied dwellings and subject to a 3% lodging tax. Contact the St. Louis Park Planning Department at 952-924-2500 to obtain the necessary conditional use permit application, which costs approximately $500-800 and requires neighbor notification and potential public hearing. Find a suitable property in residential zones R-1 through R-4, ensuring it meets safety requirements including smoke detectors, carbon monoxide detectors, and emergency egress windows. Furnish the space with quality basics including comfortable bedding, kitchen essentials, WiFi, and local guidebooks, budgeting $3,000-8,000 for initial setup. Create listings on Airbnb, VRBO, and Booking.com with professional photos highlighting proximity to Minneapolis, Excelsior Boulevard shopping, and local parks like Aquila Park. Set competitive rates by researching similar properties in nearby Edina and Hopkins, typically ranging $80-150 per night depending on size and amenities. Manage the property by establishing check-in procedures, maintaining cleanliness standards, responding promptly to guests, and keeping detailed records for the required annual reporting to the city, while ensuring compliance with the maximum occupancy limits and quiet hours typically enforced between 10 PM and 7 AM.

To identify profitable short-term rental properties in St. Louis Park, Minnesota, focus on locations within 2-3 miles of major attractions like the Minneapolis Chain of Lakes, Uptown Minneapolis, and the University of Minnesota, as well as properties near major employers like Target Corporation headquarters and Park Nicollet Health Services. Prioritize 2-4 bedroom single-family homes or condos built after 1980 with modern amenities, parking, and outdoor spaces, as these typically command $120-200 per night compared to $80-120 for basic units. Conduct pricing analysis using AirDNA and Mashvisor to track seasonal demand patterns, with peak rates during summer months (June-August) and during major Minneapolis events, while analyzing comparable properties within a 3-mile radius to ensure competitive positioning. Research competition by monitoring existing Airbnb and VRBO listings in the Westwood Hills, Minikahda Vista, and Elmwood neighborhoods, identifying gaps in amenities or pricing strategies. Utilize tools like Rabbu, BiggerPockets calculators, and local MLS data through Edina Realty or RE/MAX Results to analyze cap rates targeting 8-12% returns, while consulting St. Louis Park city regulations regarding short-term rental permits and zoning restrictions, particularly in residential areas near Wolfe Park and the Cedar Lake Trail system.

To obtain an Airbnb/STR permit in St. Louis Park, Minnesota, you must first contact the City of St. Louis Park Community Development Department at City Hall located at 5005 Minnetonka Boulevard to apply for a Short-Term Rental License. Required documents typically include a completed application form, 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 responsible party available 24/7, and payment of applicable fees. The licensing fee is estimated at $200-400 annually with potential additional inspection fees of $100-150. You must also comply with St. Louis Park's specific requirements including maximum occupancy limits based on bedrooms (typically 2 guests per bedroom plus 2 additional), parking requirements of one space per rental unit, noise ordinance compliance, and safety equipment including smoke and carbon monoxide detectors. The property may require a health and safety inspection by city officials, and you must maintain a guest registry and respond to complaints within 2 hours. The application process typically takes 4-6 weeks for approval, and licenses must be renewed annually. All short-term rentals must be registered with the state of Minnesota and comply with state tax requirements including lodging taxes.

Short-term rentals (STRs) are legal in St. Louis Park, Minnesota, but operate under specific regulations established by the city. The city requires STR operators to obtain a rental license and comply with zoning restrictions that typically limit short-term rentals to certain residential areas while prohibiting them in some neighborhoods to preserve residential character. Properties must meet safety standards including smoke and carbon monoxide detectors, and operators are subject to occupancy limits, parking requirements, and noise ordinances. St. Louis Park has implemented registration requirements and may conduct inspections to ensure compliance with health and safety codes. Recent years have seen the city refine its STR ordinances to balance tourism revenue with neighborhood concerns, including potential limits on the number of STR permits issued and enhanced enforcement mechanisms. Property owners must also comply with state and local tax obligations, and violations can result in fines or license revocation.

The most promising Airbnb investment areas in St. Louis Park, Minnesota include the Westwood Hills neighborhood near the Minneapolis border, which attracts business travelers due to its proximity to downtown Minneapolis corporate centers and the University of Minnesota, along with tourists visiting the Walker Art Center and Guthrie Theater. The Park Spanish neighborhood offers excellent potential with its historic charm and walkability to local restaurants and shops, appealing to leisure travelers seeking authentic local experiences. Areas near Highway 100 and Excelsior Boulevard provide strong investment opportunities due to easy airport access for business travelers and proximity to major employers like General Mills and Target Corporation headquarters in nearby Golden Valley and Minneapolis. The neighborhoods around Aquila Park and Recreation Center attract families visiting for youth sports tournaments and outdoor activities, while areas close to the Light Rail Transit stations offer convenience for visitors attending events at U.S. Bank Stadium, Target Center, or exploring downtown Minneapolis attractions, making these locations particularly attractive for short-term rental investments with consistent year-round demand from both business and leisure travelers.

In St. Louis Park, Minnesota, Airbnb hosts are subject to multiple lodging taxes including the state lodging tax of 3.0%, Hennepin County lodging tax of 3.0%, and the Minneapolis-St. Paul Metropolitan Sports Facilities Commission tax of 0.5%, totaling approximately 6.5% in combined lodging taxes. The city of St. Louis Park also requires a local lodging tax of 3.0%, bringing the total occupancy tax burden to around 9.5%. These taxes are typically collected by Airbnb directly from guests at the time of booking and remitted to the appropriate tax authorities on behalf of hosts through Airbnb's automated tax collection service, which began operating in Minnesota around 2017. Hosts must register with the Minnesota Department of Revenue and obtain the necessary permits, with remittance generally occurring monthly or quarterly depending on volume. Exemptions may apply for stays exceeding 30 consecutive days, certain government and nonprofit organization bookings, and in some cases for properties rented fewer than a specified number of days per year, though hosts should verify current exemption criteria as regulations have evolved since 2018-2020 when many Minnesota municipalities updated their short-term rental ordinances.

Starting an Airbnb in St. Louis Park, Minnesota requires approximately $380,000-$420,000 in total initial investment. Property purchase costs around $350,000 based on median home prices in the area as of 2023. Furnishing a 2-3 bedroom property typically costs $15,000-$25,000 including furniture, appliances, linens, and décor to create an attractive rental space. Initial setup expenses including professional photography, listing creation, and basic renovations total approximately $3,000-$5,000. Permits and licensing fees in St. Louis Park range from $200-$500 annually, plus potential HOA approval processes. Short-term rental insurance costs roughly $1,200-$2,000 annually, significantly higher than standard homeowner's insurance. Utility setup and deposits for electricity, gas, water, internet, and cable services require about $500-$800 initially. First six months of operating costs including utilities ($200/month), cleaning services ($75 per turnover), property management software ($50/month), maintenance reserves ($150/month), and marketing expenses total approximately $4,500-$6,000, assuming 60-70% occupancy rates typical for the Minneapolis metro area market.

Airbnb properties in St. Louis Park, Minnesota typically generate annual revenues between $18,000-$35,000 for entire home listings, with average daily rates ranging from $85-$140 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. Net profit margins typically range from 15-35% for well-managed properties, with successful hosts achieving higher margins through strategic pricing, excellent guest experiences, and efficient operations. Properties near Minneapolis-St. Paul International Airport and downtown Minneapolis perform particularly well due to business traveler demand, while family-friendly homes with 3+ bedrooms capitalize on leisure travelers visiting the Twin Cities metro area. Success factors include maintaining 4.8+ star ratings, responding to inquiries within an hour, providing local recommendations, and optimizing listings with professional photography and detailed descriptions. Case studies from the area show that hosts who invest in smart home technology, provide welcome amenities, and maintain consistent availability achieve occupancy rates of 65-80% compared to the market average of 45-60%, resulting in annual profits of $8,000-$15,000 per property after all expenses.

Based on St. Louis Park, 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 Westwood Hills Nature Center or close to Minneapolis attractions tend to perform at the higher end of this range. Initial profitability usually occurs within 12-18 months, with full investment recovery expected in 7-10 years. The market benefits from proximity to Minneapolis-St. Paul International Airport and downtown Minneapolis, driving consistent demand from business travelers and tourists. Average daily rates range from $85-130 with occupancy rates of 65-75% annually. Properties requiring minimal renovation show faster profitability timelines of 8-12 months, while extensive rehabs may extend to 18-24 months before positive cash flow. The suburban location appeals to families and groups seeking quieter accommodations while maintaining easy access to Twin Cities attractions, supporting stable year-round bookings with peak performance during summer months and major Minneapolis events.

STRSearch is a leading national platform that specializes in identifying profitable short-term rental properties for investors in St. Louis Park, Minnesota. Local real estate agents who focus on investment properties in the area include Edina Realty agents specializing in the Twin Cities metro, RE/MAX Results investment specialists, and Coldwell Banker Realty agents with STR expertise. National services that serve the St. Louis Park market include Mashvisor for property analytics and market research, AirDNA for short-term rental data analysis, Awning for turnkey Airbnb investments, RedAwning for vacation rental property sourcing, and Vacasa for property management services. Local property management companies that assist investors include North Homes Property Management, Twin Cities Property Management, and Minneapolis Property Management Group. Additional services include BiggerPockets for networking and education, Roofstock for online real estate investing, and local mortgage brokers like Guaranteed Rate and Fairway Independent Mortgage who understand investment property financing in the Minneapolis-St. Paul area.