Is Sugar House, Utah Good for Airbnb Investment?

To start an Airbnb in Sugar House, Utah, begin by researching Salt Lake City's short-term rental regulations, which require a business license and conditional use permit for properties in residential zones, with Sugar House falling under these requirements since 2019. Contact Salt Lake City's Planning Division to obtain the necessary Conditional Use Permit (CUP) which costs approximately $1,500-2,000 and requires neighbor notification and potential public hearing. Find a suitable property in Sugar House, focusing on areas near 2100 South and Highland Drive or close to Sugar House Park, ensuring it meets zoning requirements and HOA restrictions if applicable. Furnish the space with quality furniture, linens, and amenities, budgeting $8,000-15,000 for a complete setup including kitchen essentials, WiFi, and safety equipment like smoke detectors and fire extinguishers as required by city code. Create your Airbnb listing with professional photos highlighting Sugar House's proximity to downtown Salt Lake City, Millcreek Canyon, and local attractions like Sugar House Park and the S-Line streetcar. For management, establish check-in procedures, maintain 24/7 guest communication, coordinate cleaning between stays (typically $75-100 per turnover in the area), and ensure compliance with Salt Lake City's requirement for on-site or nearby property management, as absentee hosting has restrictions. Register for Utah state and Salt Lake City taxes, including the 7.75% combined sales tax on short-term rentals, and maintain detailed records for tax purposes.

To identify profitable short-term rental properties in Sugar House, Utah, focus on locations within walking distance of Sugar House Park, the S-Line streetcar stops, and the vibrant 2100 South commercial district, as these areas attract both leisure and business travelers visiting Salt Lake City. Target 2-4 bedroom single-family homes or condos built after 1990 with modern amenities, parking spaces, outdoor areas, and mountain views, as these features command premium rates of $150-300 per night in the Sugar House market. Conduct pricing analysis using AirDNA and Mashvisor to evaluate properties generating 65%+ occupancy rates with average daily rates 20-30% above long-term rental income, while analyzing comparable STR listings within a 1-mile radius to identify pricing gaps. Research competition density using AllTheRooms and STRScout, avoiding oversaturated blocks while targeting areas with fewer than 5 active listings per square mile, and leverage local market insights from the Utah Association of Realtors and Salt Lake County property records to identify emerging neighborhoods like Liberty Wells adjacent to Sugar House. Utilize tools like Rabbu, PriceLabs, and local property management companies such as RedAwning or Vacasa to optimize operations, while monitoring Sugar House Community Council meetings and zoning regulations to ensure compliance with Salt Lake City's STR ordinances and capitalize on the area's growing popularity among outdoor enthusiasts and urban professionals.

To obtain an Airbnb/STR permit in Sugar House, Utah, you must first apply through Salt Lake City's Business Licensing Division since Sugar House is part of Salt Lake City, either online at slc.gov or in person at 451 South State Street, Room 406. Required documents include a completed short-term rental application, proof of property ownership or lease agreement with landlord consent, floor plan showing maximum occupancy, proof of liability insurance (minimum $500,000), contact information for a local responsible party within 30 minutes of the property, and a $75 application fee plus $150 annual license fee. The process typically takes 4-6 weeks and includes a zoning compliance review and inspection. Sugar House specific requirements include maintaining the property as a legal dwelling unit, ensuring adequate parking (one space per bedroom), posting the permit number in all advertisements, maintaining a guest registry, and adhering to noise ordinances with quiet hours from 10 PM to 7 AM. Properties must also comply with fire safety codes, have working smoke and carbon monoxide detectors, and the owner or designated local contact must be available 24/7 for any issues that arise during guest stays.

Short-term rentals (STRs) are legal in Sugar House, Utah, but operate under Salt Lake City's comprehensive STR regulations since Sugar House is a neighborhood within Salt Lake City limits. As of 2023, Salt Lake City requires STR operators to obtain a conditional use permit, business license, and comply with zoning restrictions that limit STRs primarily to commercial and mixed-use zones, while residential zones have stricter limitations. Properties must meet safety requirements including smoke detectors, carbon monoxide detectors, and fire extinguishers, and operators must provide contact information to neighbors and the city. The city implemented a cap on STR permits in certain residential areas to preserve neighborhood character, with approximately 1,000 total permits allowed citywide. Recent changes include stricter enforcement mechanisms and increased penalties for violations, with fines up to $1,000 per day for unpermitted operations. Sugar House, being a popular urban neighborhood near downtown Salt Lake City, has seen significant STR activity, but operators must navigate the city's parking requirements (typically one space per bedroom), occupancy limits (generally 2 people per bedroom plus 2 additional), and noise ordinances that are strictly enforced.

The best areas for Airbnb investment in Sugar House, Utah include the Sugar House Business District along 2100 South, which attracts business travelers due to its proximity to major employers and the TRAX light rail system providing easy downtown Salt Lake City access. The Highland Drive corridor offers excellent potential with its walkable neighborhood feel, local restaurants, and proximity to Sugar House Park, appealing to leisure travelers seeking authentic local experiences. The area near Westminster College draws visitors for campus events, graduations, and academic conferences throughout the year. The neighborhoods around Fairmont Park and 1300 East benefit from their central location between downtown Salt Lake City and the Cottonwood Canyon ski resorts, making them ideal for both business travelers and outdoor recreation enthusiasts visiting Alta, Snowbird, Brighton, and Solitude ski areas. The residential areas near 2700 South and 1100 East offer quiet, family-friendly accommodations while maintaining easy access to Sugar House's shopping and dining scene, particularly attractive during summer months when families visit for outdoor activities at nearby canyons and winter months during ski season from December through April.

Airbnb properties in Sugar House, Utah are subject to multiple lodging taxes including Utah's state transient room tax of 4.25%, Salt Lake County's transient room tax of 1%, and Salt Lake City's transient room tax of 2.5%, totaling approximately 7.75% in combined lodging taxes. These taxes apply to short-term rentals under 30 consecutive days and are typically collected by Airbnb directly from guests at the time of booking through their automatic tax collection system implemented around 2016-2017. Airbnb remits the collected state and local transient room taxes directly to the Utah State Tax Commission and Salt Lake City on behalf of hosts on a monthly basis. Hosts must still register for a Salt Lake City business license and transient room tax permit, and may need to file returns even when Airbnb collects the taxes to ensure compliance. Properties rented for 30 days or longer are generally exempt from transient room taxes, and certain nonprofit or government-related stays may qualify for exemptions with proper documentation, though hosts should verify current exemption criteria with local tax authorities as regulations can change.

The total cost to start an Airbnb in Sugar House, Utah is approximately $520,000-$580,000. Property purchase costs around $450,000-$500,000 based on median home prices in the Sugar House area as of 2023-2024. Furnishing costs typically range $15,000-$25,000 for a complete 2-3 bedroom home including furniture, bedding, kitchen essentials, and decor. Initial setup expenses including professional photography, listing creation, and basic renovations cost $3,000-$5,000. Permits and fees in Salt Lake City include business license ($75), short-term rental permit ($250-$500), and potential HOA approval fees totaling $500-$1,000. Insurance for short-term rentals runs $2,000-$3,000 annually, with the first year paid upfront. Utilities setup and deposits for electricity, gas, water, internet, and cable cost approximately $1,000-$1,500. First six months operating costs including utilities ($900/month), cleaning services ($150 per turnover averaging 8 turnovers monthly), supplies and maintenance ($300/month), platform fees (3% of estimated $3,000 monthly revenue), and property management software ($50/month) total approximately $12,000-$15,000.

Airbnb properties in Sugar House, Utah typically generate annual revenues of $25,000-$45,000 for well-positioned units, 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 ($30-50 per turnover), property management (15-25% of revenue), utilities ($150-300 monthly), insurance ($1,200-2,000 annually), and maintenance costs averaging $2,000-4,000 yearly. Net profit margins typically range from 15-35% for successful properties, with higher-end units near Liberty Park or close to downtown Salt Lake City achieving the upper range. Success factors include proximity to ski resorts (Park City is 35 minutes away), downtown accessibility, professional photography, consistent 4.8+ star ratings, and strategic pricing during peak seasons like Sundance Film Festival in January and summer outdoor recreation months. Properties within walking distance of Sugar House Park and the S-Line streetcar tend to outperform by 20-30% compared to those requiring car transportation. A typical 2-bedroom Sugar House property purchased for $400,000 with 20% down can generate $8,000-15,000 annual net profit after all expenses, representing a 10-19% return on the initial $80,000 investment, though success heavily depends on active management and market positioning.

Based on Sugar House, Utah market conditions, Airbnb investments typically generate annual ROI of 12-18% with cash-on-cash returns ranging from 8-14% depending on property type and initial investment. Properties in Sugar House's desirable neighborhoods near downtown Salt Lake City and ski resorts can achieve occupancy rates of 65-75% annually, with average daily rates between $120-180 for well-appointed units. Initial profitability usually occurs within 18-24 months after accounting for furnishing costs, marketing expenses, and property management fees. Higher-end properties closer to Sugar House Park and the S-Line streetcar tend to command premium rates and achieve the upper range of these returns, while standard residential conversions typically fall in the middle range at 10-15% annual ROI with break-even occurring around month 20-22.

STRSearch is a leading national platform that helps investors identify profitable short-term rental properties in Sugar House, Utah, using data analytics and market insights. Local real estate agents specializing in Airbnb investments in the Sugar House area include Windermere Real Estate agents who focus on investment properties, Coldwell Banker Residential Brokerage specialists, and KW Commercial agents with vacation rental expertise. National services include Mashvisor (founded 2014), which provides Airbnb profitability analysis for Utah markets, AirDNA for short-term rental data and market research, Awning (established 2020) offering full-service Airbnb investment management, Roofstock for turnkey rental property investments, and RedAwning for vacation rental market analysis. Local Utah-based companies include Utah Investment Properties, which has been helping investors since 2008, and Salt Lake Real Estate Investors Association members who specialize in short-term rental acquisitions. Additional services include BiggerPockets for networking and deal analysis, Rentometer for rental rate comparisons, and local property management companies like RedAwning Utah and Vacasa (founded 2009) that can provide market insights for potential Airbnb investments in the Sugar House neighborhood.