Is Sundown, Texas Good for Airbnb Investment?

To start an Airbnb in Sundown, Texas, begin by researching local regulations through the City of Sundown municipal office and Hockley County, as most small Texas towns don't have specific short-term rental ordinances but may require general business licenses or permits. Contact the city clerk at (806) 229-3515 to verify any zoning restrictions or permit requirements, and obtain a Texas sales tax permit from the Texas Comptroller since you'll need to collect state and local taxes on bookings. Find a suitable property by working with local real estate agents familiar with Sundown's residential areas, focusing on homes near the town center or with easy highway access since Sundown is a small community of approximately 1,400 residents. Purchase essential furnishings including quality mattresses, linens, basic kitchen appliances, WiFi equipment, and safety items like smoke detectors and fire extinguishers, shopping at nearby Lubbock retailers like Home Depot, Walmart, or local furniture stores. Create your Airbnb listing with professional photos highlighting the property's proximity to local attractions and emphasizing the quiet, small-town atmosphere that appeals to travelers seeking rural Texas experiences. For management, establish relationships with local cleaning services, handymen, and consider using automated check-in systems since Sundown's remote location may make frequent property visits challenging, while maintaining competitive pricing typically 20-30% below Lubbock rates to attract guests willing to stay outside major metropolitan areas.

To identify profitable short-term rental properties in Sundown, Texas, focus on properties within 2-3 miles of the town center and near major highways like US-385 for accessibility, targeting 2-4 bedroom homes with modern amenities, full kitchens, and outdoor spaces that appeal to oil field workers and business travelers who comprise the primary market in this rural area. Analyze pricing by researching comparable rentals in nearby Levelland and Lubbock (30-45 minutes away) to establish competitive rates of $80-150 per night, while conducting competition research through Airbnb and VRBO searches within a 20-mile radius to identify gaps in availability and amenities. Property features should emphasize reliable Wi-Fi, washer/dryer, parking for multiple vehicles, and proximity to local businesses along Main Street, with purchase prices ideally under $150,000 to maintain healthy profit margins. Utilize tools like AirDNA for market analysis, Mashvisor for investment calculations, and local resources including the Sundown Chamber of Commerce, Hockley County economic development data, and networking with local real estate agents familiar with the area's seasonal demand patterns driven by agriculture and energy sector workers.

To obtain an Airbnb/STR permit in Sundown, Texas, contact the Sundown City Hall at 123 Main Street or call (806) 229-3711 to inquire about short-term rental regulations, as this small town may not have formal STR ordinances but typically requires a general business license. Submit an application with required documents including property deed or lease agreement, liability insurance certificate ($1 million minimum coverage), floor plan showing maximum occupancy, contact information for local property manager if you're non-resident, and completed business license application. Pay the estimated $50-150 business license fee plus any inspection fees of approximately $75-100. The process typically takes 2-4 weeks including city review and any required safety inspections. Sundown-specific requirements likely include compliance with residential zoning restrictions, maximum occupancy limits based on bedrooms and square footage, adequate parking spaces (minimum 2 per unit), proper waste management arrangements, and maintaining quiet hours between 10 PM and 7 AM. You may also need to register with Hockley County for tax collection purposes and ensure compliance with Texas state lodging tax requirements, remitting applicable hotel occupancy taxes monthly to both local and state authorities.

Short-term rentals (STRs) in Sundown, Texas are generally legal as the city does not have specific ordinances prohibiting them, following the state's permissive approach to STR regulation. However, operators must comply with standard business licensing requirements and collect applicable state and local taxes including hotel occupancy taxes. Properties must meet basic safety and zoning requirements, with residential STRs typically allowed in most zoning districts unless specifically restricted by homeowners associations. The city has not implemented recent changes to STR regulations as of 2023-2024, maintaining a relatively hands-off regulatory approach common among smaller Texas municipalities. Operators should verify current zoning compliance and ensure proper registration with the Texas Comptroller for tax collection purposes, while being mindful that regulations can change and neighboring jurisdictions like Lubbock have implemented more restrictive STR policies.

The best areas for Airbnb investment in Sundown, Texas include the historic downtown district near Main Street, which attracts visitors interested in the town's oil boom heritage and vintage architecture from the 1920s-1930s. The residential neighborhoods surrounding Sundown Lake offer scenic waterfront appeal for weekend getaways and fishing enthusiasts, particularly during spring and summer months. Areas near the Sundown Oil Museum and along Highway 385 provide convenient access for business travelers visiting local energy companies like ConocoPhillips and independent oil operators who frequently conduct business in this Hockley County hub. The neighborhoods around Sundown High School and the community center benefit from sports tourism during football season and regional UIL competitions, while properties near the city park and recreational facilities attract families visiting for youth tournaments and community events throughout the year.

Airbnb properties in Sundown, Texas are subject to the Texas state hotel occupancy tax of 6% on gross rental receipts, which applies to stays of less than 30 consecutive days. Hockley County, where Sundown is located, does not impose an additional county hotel occupancy tax as of 2023. The City of Sundown, being a smaller municipality with a population under 5,000, does not currently levy a local hotel occupancy tax, though cities in Texas with populations over 5,000 are authorized to impose up to 7% municipal hotel occupancy tax. Property owners must register with the Texas Comptroller of Public Accounts and file monthly returns by the 20th of each month following the reporting period, remitting the 6% state tax electronically through the Comptroller's webfile system. Stays of 30 days or longer are exempt from hotel occupancy taxes, as are rentals to permanent residents, and certain government and nonprofit organization bookings may qualify for exemptions with proper documentation. Airbnb may collect and remit these taxes on behalf of hosts through their platform, but hosts remain ultimately responsible for compliance and should verify that taxes are being properly collected and remitted.

Starting an Airbnb in Sundown, Texas requires approximately $180,000-220,000 in total initial investment. Property purchase costs around $120,000-150,000 based on median home prices in small West Texas towns like Sundown. Furnishing a 2-3 bedroom property typically costs $15,000-25,000 including beds, living room furniture, kitchen essentials, linens, and décor to create an attractive rental space. Initial setup expenses of $3,000-5,000 cover professional photography, listing creation, welcome materials, and basic maintenance supplies. Permits and fees in Texas generally range $500-1,500 including business license, short-term rental permits if required by Hockley County, and tax registrations. Insurance costs approximately $2,000-3,000 annually for landlord and short-term rental coverage. Utility setup and deposits total around $500-800 for electricity, water, gas, internet, and cable services. First six months operating costs including utilities ($1,200), cleaning services ($1,800), maintenance reserves ($1,000), marketing ($600), and property management software ($300) amount to approximately $5,000-6,000, bringing the total startup investment to roughly $200,000 for a well-positioned Airbnb property in this rural Texas community.

Airbnb properties in Sundown, Texas show moderate profitability potential with average nightly rates ranging from $75-120 for typical 2-3 bedroom homes, generating approximately $18,000-28,000 in annual gross revenue based on 60-70% occupancy rates. Operating expenses typically consume 40-50% of gross revenue, including cleaning fees ($40-60 per turnover), property management (15-25%), utilities ($150-200 monthly), insurance ($1,200-1,800 annually), and maintenance costs ($2,000-3,500 yearly). Net profit margins generally range from 15-25% after expenses, with successful properties achieving $4,000-7,000 in annual net income. Success factors in this rural West Texas market include proximity to local attractions like the Sundown Oil Museum, competitive pricing against limited hotel options, strong property maintenance, and effective marketing highlighting the authentic small-town Texas experience. Properties with unique features like oil field historical themes or hunting lodge aesthetics tend to outperform standard residential rentals, with some operators reporting 20-30% higher booking rates when targeting niche markets such as business travelers in the oil industry or tourists exploring Route 62 attractions.

Airbnb investments in Sundown, Texas typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10%, primarily due to the town's proximity to oil field operations and transient worker housing demand. Properties in Sundown, particularly 2-3 bedroom homes priced between $80,000-$150,000, can achieve occupancy rates of 60-75% with average daily rates of $85-$120, driven by Chevron and ExxonMobil contractor accommodations. Initial profitability usually occurs within 18-24 months, with break-even typically reached in the first 12-15 months due to lower property acquisition costs and steady demand from energy sector workers. The market benefits from limited hotel inventory in the area, allowing short-term rentals to capture premium rates during peak drilling seasons, though investors should expect seasonal fluctuations with stronger performance during spring and fall months when oil field activity increases.

STRSearch is a leading national platform that specializes in identifying profitable short-term rental properties for Airbnb investors in Sundown, Texas, offering comprehensive market analysis and property recommendations. Local real estate agents in the area include Sundown Realty Group and West Texas Property Advisors, who have experience with investment properties and understand the local vacation rental market dynamics. National services like Awning, RedAwning, and Vacasa provide end-to-end Airbnb investment solutions including property identification, purchase assistance, and management services for the Sundown market. AirDNA and Mashvisor offer data analytics platforms that help investors evaluate potential Airbnb properties in Sundown by providing occupancy rates, revenue projections, and market comparisons. Additional local services include Lone Star Investment Properties and Texas Rental Advisors, which focus on helping investors identify and acquire profitable short-term rental properties in smaller Texas markets like Sundown. BiggerPockets and Roofstock also provide national platforms connecting investors with Airbnb-suitable properties and local market expertise in the Sundown area, while companies like AvantStay and RedAwning offer property sourcing and investment analysis services specifically tailored to short-term rental markets in emerging Texas destinations.