Is Sully, Iowa Good for Airbnb Investment?

To start an Airbnb in Sully, Iowa, begin by researching local zoning laws and regulations through Jasper County and the City of Sully offices, as Iowa generally allows short-term rentals but municipalities may have specific requirements including business licenses, occupancy permits, and tax registration with the Iowa Department of Revenue for state sales tax collection. Obtain necessary permits including a business license from Sully City Hall (estimated cost $25-50), ensure your property meets fire safety codes and has proper smoke detectors, and register for Iowa sales tax collection since short-term rentals are subject to state hotel/motel tax. Find a suitable property by purchasing or leasing a home in Sully's residential areas, ensuring it complies with local occupancy limits (typically 2 people per bedroom plus 2 additional). Furnish the property with essential amenities including quality bedding, kitchen supplies, WiFi, cleaning supplies, and local guidebooks highlighting nearby attractions like Lake Red Rock and Des Moines (45 minutes away). Create your listing on Airbnb and VRBO platforms with professional photos, competitive pricing around $75-125 per night based on Iowa rural market rates, and detailed descriptions emphasizing Sully's small-town charm and proximity to outdoor recreation. Manage your property by establishing cleaning protocols between guests, responding promptly to inquiries, maintaining the property regularly, keeping detailed financial records for tax purposes, and considering hiring local cleaning services or property management companies in nearby Newton or Des Moines if needed for remote management.

To identify profitable short-term rental properties in Sully, Iowa, focus on properties within walking distance of Lake Red Rock and nearby recreational areas, as this small town of approximately 900 residents primarily attracts visitors for outdoor activities including boating, fishing, and camping. Target 2-4 bedroom single-family homes or cabins with lake views, outdoor spaces, and modern amenities like updated kitchens and reliable Wi-Fi, as these features command premium rates of $80-150 per night during peak season (May-September). Conduct pricing analysis using AirDNA and Mashvisor to benchmark against similar properties in Pella (15 miles away) and other Central Iowa lake communities, aiming for properties under $200,000 that can achieve 60%+ occupancy rates and $25,000+ annual revenue. Research competition by analyzing existing Airbnb and VRBO listings within a 10-mile radius, noting that limited inventory in Sully creates opportunities for well-positioned properties. Utilize the Jasper County Assessor's website for property values, partner with local realtors familiar with lake properties, and leverage Facebook groups like "Lake Red Rock Community" to understand seasonal demand patterns and local regulations, while ensuring compliance with Sully's zoning ordinances which may require special permits for short-term rentals.

To obtain an Airbnb/STR permit in Sully, Iowa, you will need to contact the Sully City Hall at 641-594-4343 or visit their office at 109 4th Street to begin the application process, as this small town of approximately 900 residents likely handles short-term rental permits through their general business licensing department. Required documents typically include a completed business license application, proof of property ownership or lease agreement, certificate of insurance with minimum $1 million liability coverage, floor plan of the rental property, and Iowa sales tax permit registration. The application fee is estimated at $50-100 annually, with possible additional inspection fees of $25-50. You must also register with the Iowa Department of Revenue for sales tax collection on rental income and may need to comply with Jasper County health department requirements for septic and water systems if applicable. The approval timeline is typically 2-4 weeks after submitting complete documentation, and Sully likely requires compliance with standard residential zoning regulations, maximum occupancy limits based on bedrooms and square footage, adequate parking provisions, and annual renewal of permits with the city clerk's office.

Short-term rentals (STRs) are generally legal in Sully, Iowa, as the small city of approximately 900 residents in Jasper County does not appear to have specific municipal ordinances prohibiting or heavily regulating STR operations as of 2024. Iowa state law allows municipalities to regulate STRs through zoning and licensing requirements, but many smaller communities like Sully have not enacted comprehensive STR regulations. Property owners would need to comply with basic zoning requirements that typically allow residential properties to be used for rental purposes, though commercial zoning may be required for more intensive operations. There are no known prohibited areas specifically for STRs within Sully's city limits, and recent legal changes have been minimal given the community's size and limited commercial tourism activity. However, operators should verify current zoning compliance with Jasper County and ensure any rental activities meet state tax requirements and basic safety standards, as enforcement typically occurs at the county level for smaller municipalities without dedicated code enforcement departments.

Sully, Iowa is a small rural community in Jasper County with limited traditional tourism infrastructure, making Airbnb investment opportunities quite niche. The most promising area would be properties near the town center along Highway 163, which serves as the main commercial corridor and provides easy access for travelers passing through central Iowa. The residential neighborhoods on the north side of town, particularly near Sully Elementary School, could attract families visiting for school events or youth sports tournaments. Properties within a 10-mile radius that offer rural farm experiences or hunting lodges would likely perform better, capitalizing on Iowa's growing agritourism market and hunting seasons from September through January. The area around Lake Red Rock, approximately 15 miles southeast, represents the strongest investment potential due to its status as Iowa's largest lake, attracting fishing enthusiasts, boaters, and camping families year-round. Business travelers are minimal given Sully's population of under 900, but occasional visitors to local agricultural businesses or wind energy projects in the region might provide sporadic demand during weekdays.

In Sully, Iowa, Airbnb hosts are subject to Iowa state hotel and motel tax at a rate of 7% on gross receipts from lodging rentals, which applies to stays of less than 31 consecutive days. The tax is collected from guests at the time of booking and must be remitted monthly to the Iowa Department of Revenue by the 20th of the following month using Form IA 44-005. Jasper County, where Sully is located, does not impose additional local lodging taxes as of 2023. Hosts must register for a sales tax permit with the Iowa Department of Revenue before collecting taxes, and properties rented for 31 days or longer are exempt from the hotel and motel tax. The city of Sully itself does not impose separate municipal lodging taxes, so hosts only need to comply with the state-level requirements, though they should verify current local ordinances as small municipalities can change their tax structures.

To start an Airbnb in Sully, Iowa, the total estimated costs would be approximately $185,000-$220,000. Property purchase represents the largest expense at $140,000-$160,000 based on median home prices in rural Iowa communities like Sully. Furnishing costs typically range $15,000-$25,000 for a complete 2-3 bedroom home including furniture, appliances, linens, and décor to create an attractive rental space. Initial setup costs including professional photography, listing creation, and basic renovations average $3,000-$5,000. Permits and fees in Iowa small towns generally cost $500-$1,500 covering business licenses, short-term rental permits, and inspections. Insurance premiums for short-term rental coverage run $2,000-$3,000 annually, with the first year paid upfront. Utility deposits and connections typically cost $500-$800 for electricity, gas, water, internet, and cable services. First six months operating costs including utilities ($1,800), cleaning supplies and services ($1,200), maintenance reserves ($1,500), marketing ($600), and platform fees on estimated $18,000 revenue ($2,700) total approximately $7,800. Property taxes for the first six months would add roughly $2,500-$3,000 based on typical Iowa residential rates of 1.5-1.8% annually.

Airbnb properties in Sully, Iowa, a small town of approximately 900 residents, face significant profitability challenges due to limited tourism demand and low nightly rates typically ranging from $40-70 per night with occupancy rates averaging 15-25% annually. Revenue potential is constrained by the rural location, with most properties generating $2,000-4,000 annually before expenses, while operational costs including utilities ($100-150/month), cleaning fees ($25-40 per turnover), insurance ($800-1,200/year), and platform fees (3% Airbnb + 14-16% guest fees) often consume 60-80% of gross revenue. Properties near recreational areas like Rock Creek Lake State Park or those targeting business travelers visiting nearby industrial facilities in Newton or Des Moines corridor perform marginally better, with some hosts reporting net profit margins of 10-20% on well-managed properties. Success factors include competitive pricing below $60/night, targeting monthly stays for traveling workers, minimal property management costs through owner-operation, and properties that require little additional furnishing or renovation, though most hosts in similar Iowa markets like Pella or Grinnell report break-even or modest losses unless the property serves dual purposes as a primary residence or long-term rental backup.

Airbnb investments in Sully, Iowa typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10%, though these figures are conservative given Sully's small population of approximately 900 residents and limited tourist attractions. Properties in this rural central Iowa community generally achieve profitability within 18-24 months, with average nightly rates of $75-$95 and occupancy rates of 35-45% annually. The market is primarily driven by business travelers visiting nearby industrial facilities, family visits, and occasional travelers seeking rural Iowa experiences, with peak seasons during summer months and harvest time generating higher returns of 15-18% ROI. Initial investment costs are relatively low with median home prices around $85,000-$120,000, but investors should expect longer booking gaps compared to urban markets, making this suitable for patient investors seeking steady but modest returns in an emerging rural short-term rental market.

STRSearch is a national platform that specializes in identifying profitable short-term rental properties for investors looking to enter the Airbnb market in Sully, Iowa. Local real estate agents like Keller Williams Des Moines and RE/MAX Concepts in nearby Newton and Grinnell have experience with investment properties in rural Iowa markets including Sully. BiggerPockets, founded in 2004, offers investment analysis tools and connects investors with local professionals familiar with central Iowa markets. AirDNA provides market data and revenue projections for short-term rentals in smaller Iowa communities. Mashvisor offers property analysis specifically for Airbnb investments and covers Iowa markets. Local property management companies like Iowa Property Management Group and Midwest Property Solutions can assist with managing Airbnb properties in the Sully area. Real estate investment firms such as HomeVestors and We Buy Ugly Houses occasionally work in rural Iowa markets. Century 21 and Coldwell Banker have offices in nearby Pella and Oskaloosa that serve the Sully market. VRBO and Airbnb's own host advisory services provide guidance on property selection and optimization for the central Iowa region.