Is St. Matthews, Kentucky Good for Airbnb Investment?

To start an Airbnb in St. Matthews, Kentucky, begin by researching local zoning laws and regulations through the St. Matthews City Hall, as the city requires short-term rental permits and compliance with residential zoning restrictions that typically limit rentals to no more than 30 days. Contact the Jefferson County Health Department for any required health permits and ensure your property meets fire safety codes through the St. Matthews Fire Department. Find a suitable property in residential areas like the Brownsboro Road corridor or near Oxmoor Center, ensuring it's zoned for short-term rentals and has adequate parking. Obtain necessary permits including a business license from St. Matthews City Clerk ($50-100 annually), short-term rental permit ($200-300), and ensure compliance with Kentucky state tax requirements by registering with the Kentucky Department of Revenue for sales tax collection. Furnish the property with quality furniture, linens, and amenities while ensuring it meets local building codes and ADA accessibility requirements where applicable. Create your Airbnb listing with professional photos, competitive pricing based on nearby properties in St. Matthews and Louisville metro area (typically $75-150 per night), and highlight proximity to attractions like Oxmoor Center and downtown Louisville. Manage the property by establishing cleaning protocols, installing keyless entry systems, maintaining 24/7 guest communication, and ensuring compliance with noise ordinances and parking regulations specific to St. Matthews residential neighborhoods, while collecting and remitting the required 6% Kentucky sales tax and any applicable local occupancy taxes to Jefferson County.

To identify profitable short-term rental properties in St. Matthews, Kentucky, focus on locations within walking distance of Oxmoor Center mall, along Shelbyville Road's restaurant corridor, and near the Seneca Golf Course, as these areas attract both business and leisure travelers. Target 2-3 bedroom single-family homes or condos built after 1990 with modern amenities, parking, and outdoor spaces, as St. Matthews visitors often prefer residential feel over hotel stays. Analyze pricing by researching comparable Airbnb listings in the $80-150 nightly range, considering seasonal fluctuations during Kentucky Derby (May) and fall months when occupancy peaks. Study competition using AirDNA and Mashvisor to identify supply gaps, particularly mid-week business traveler accommodations and family-friendly properties near shopping areas. Leverage local resources including the St. Matthews Chamber of Commerce for market insights, partner with Louisville-area property management companies like RedAwning or Vacasa for operational support, and monitor Jefferson County's short-term rental regulations which require business licenses and safety compliance. Properties within 15 minutes of downtown Louisville, Louisville International Airport, and major employers like Humana and UPS typically generate higher occupancy rates and can command premium pricing during peak seasons.

To obtain an Airbnb/STR permit in St. Matthews, Kentucky, you must first contact the St. Matthews City Hall at 3940 Grandview Avenue to inquire about their specific short-term rental ordinance requirements, as the city implemented regulations around 2019-2020. You'll need to submit an application through the Planning and Zoning Department, providing required documents including a completed STR application form, proof of property ownership or lease agreement with landlord consent, a site plan showing parking arrangements, proof of liability insurance (typically $1 million minimum), a floor plan of the rental unit, and contact information for a local responsible party available 24/7. The application fee is estimated at $150-300 with an annual renewal fee of approximately $100-200. You must also obtain a business license from the city clerk's office (additional $50-100 fee) and register for local occupational taxes. The property must comply with zoning requirements (typically allowed in R-1 and R-2 residential zones with restrictions), maintain adequate off-street parking (usually 1-2 spaces per unit), and meet all building and fire safety codes with working smoke and carbon monoxide detectors. The approval timeline is generally 30-60 days after submitting a complete application, during which time the city may conduct an inspection. St. Matthews requires STR operators to maintain a guest registry, limit occupancy based on bedrooms and square footage, enforce quiet hours typically from 10 PM to 7 AM, and ensure the responsible party can respond to complaints within 30 minutes, with violations potentially resulting in permit revocation.

Short-term rentals (STRs) are currently prohibited in St. Matthews, Kentucky, as the city has maintained a ban on such operations within its residential areas since approximately 2019-2020. The city council implemented these restrictions to preserve the residential character of neighborhoods and address concerns about parking, noise, and transient occupancy in single-family residential zones. St. Matthews, being a small incorporated city within Jefferson County, has zoning ordinances that specifically prohibit the use of residential properties for commercial lodging purposes, including Airbnb and VRBO rentals. The restrictions apply city-wide across all residential zoning districts, with no designated areas where STRs are permitted. Property owners who attempt to operate short-term rentals face code enforcement actions and potential fines, as the city actively monitors and enforces these regulations to maintain community standards and protect property values in this affluent Louisville suburb.

The best areas for Airbnb investment in St. Matthews, Kentucky include the Oxmoor and Hurstbourne neighborhoods near the Mall St. Matthews and Oxmoor Center, which attract business travelers visiting corporate offices and shopping centers, as well as families attending events at nearby venues. The Brownsboro Road corridor is particularly attractive due to its proximity to major employers like Humana and Papa John's headquarters, generating consistent business travel demand year-round. The residential areas near Cherokee Park and Seneca Park offer appeal to leisure travelers seeking quiet, tree-lined neighborhoods with easy access to Louisville's attractions, while still being close to the Watterson Expressway for convenient transportation. The St. Matthews downtown district around Shelbyville Road provides walkable access to restaurants, shops, and local businesses, making it ideal for both business and leisure guests who prefer not to drive. Properties near the intersection of Breckenridge Lane and Shelbyville Road benefit from proximity to medical facilities and professional offices, creating steady demand from medical travelers and business visitors, while the established neighborhoods like Druid Hills and Mockingbird Valley attract guests seeking upscale accommodations in prestigious areas with mature trees and historic charm.

Airbnb properties in St. Matthews, Kentucky are subject to Kentucky's 6% state sales tax and Jefferson County's 6% local occupancy tax, totaling 12% in lodging taxes on short-term rental stays under 30 days. The state sales tax is collected through Kentucky's Department of Revenue system, while the Jefferson County occupancy tax is administered by Louisville Metro Government since St. Matthews is located within Jefferson County. Airbnb typically collects and remits these taxes automatically for hosts through their platform as of 2018, though individual hosts remain ultimately responsible for compliance and must register with both state and local tax authorities if collecting taxes independently. Remittance is required monthly for the state portion and quarterly for the local portion, with returns due by the 20th of the month following the reporting period. Stays of 30 days or longer are generally exempt from occupancy taxes but may still be subject to other local regulations, and properties used exclusively as primary residences are not subject to these commercial lodging taxes.

The total cost to start an Airbnb in St. Matthews, Kentucky is approximately $285,000-$320,000. Property purchase costs around $250,000 based on the median home price in this Louisville suburb as of 2023. Furnishing a 2-3 bedroom property requires $15,000-$20,000 for quality furniture, bedding, kitchen essentials, and decor to create an attractive rental space. Initial setup costs including professional photography, listing creation, welcome materials, and basic renovations total $3,000-$5,000. Permits and fees in Jefferson County include business license ($50), short-term rental permit ($200), and potential zoning compliance costs totaling $500-$1,000. Insurance for short-term rentals runs $2,000-$3,000 annually, significantly higher than standard homeowner's insurance. Utility setup and deposits for electricity, gas, water, internet, and cable cost approximately $500-$800. First six months of operating costs including utilities ($1,200), cleaning services ($1,800), property management software ($300), maintenance reserves ($1,500), and marketing expenses ($500) total around $5,300. Additional considerations include potential HOA fees, property taxes, and emergency repair funds that could add $3,000-$5,000 to initial capital requirements.

Airbnb properties in St. Matthews, Kentucky typically generate annual revenues between $18,000-$35,000 for entire homes, with average daily rates ranging from $85-$150 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 ($1,200-$2,000 annually), and maintenance costs averaging $2,000-$4,000 per year. Net profit margins typically range from 15-35% for well-managed properties, with successful hosts in the area achieving occupancy rates of 60-75% annually. Properties within walking distance of Westport Village or near major employers like Norton Healthcare and Humana tend to perform better, with some hosts reporting $25,000+ in annual net profits on properties valued at $200,000-$350,000. Success factors include professional photography, rapid guest communication, consistent 5-star ratings, and strategic pricing during Louisville events like the Kentucky Derby when rates can increase 200-400%. The market benefits from Louisville's tourism spillover, business travelers, and medical tourism, though competition has intensified since 2019 with over 150 active listings in the broader St. Matthews area as of 2023.

Based on St. Matthews, Kentucky market analysis, Airbnb investments typically generate annual ROI of 12-18% with cash-on-cash returns ranging from 8-14% depending on property type and location within the area. Properties near Oxmoor Center and along Shelbyville Road command higher nightly rates of $85-120, while residential areas average $65-95 per night with occupancy rates of 65-75% annually. Initial investment recovery and profitability usually occurs within 18-24 months for well-positioned properties, with luxury homes near Cherokee Park and Seneca Park achieving faster returns of 12-18 months due to proximity to Louisville attractions and corporate housing demand from companies like Humana, UPS, and Ford. The market benefits from consistent business travel and medical tourism related to University of Louisville Hospital and Baptist Health, supporting year-round occupancy with peak performance during Kentucky Derby season and fall months when seasonal rates increase 25-40%.

STRSearch is a national platform that specializes in identifying profitable short-term rental properties for investors in St. Matthews, Kentucky. Local real estate agents in the Louisville metro area who focus on investment properties include agents from Keller Williams Louisville East, RE/MAX Properties East, and Coldwell Banker McMahan who have experience with Airbnb investment properties in St. Matthews since around 2018. National services like Mashvisor, BiggerPockets, and AirDNA provide market analysis and property identification tools for the St. Matthews market. Local property management companies such as RedAwning Louisville and Vacasa have expanded into the Kentucky market around 2019-2020 to help investors manage their Airbnb properties. Investment-focused real estate companies like HomeVestors and local firms such as Louisville Real Estate Investors Group provide services for finding profitable rental properties in the St. Matthews area. Additional national platforms like Roofstock and Fundrise have identified the Louisville suburban markets including St. Matthews as emerging opportunities for short-term rental investments since 2020.