Is Texarkana, Arkansas Good for Airbnb Investment?

To start an Airbnb in Texarkana, Arkansas, begin by researching local zoning laws and regulations through the Texarkana Planning Department, as the city requires short-term rental permits and compliance with residential zoning restrictions that typically limit rentals to no more than 30% of units in residential areas. Obtain necessary permits including a business license from the City of Texarkana ($50-100 annually), sales tax permit from Arkansas Department of Finance, and short-term rental permit ($200-300), while ensuring compliance with fire safety codes and ADA requirements if applicable. Find a suitable property in desirable neighborhoods like Spring Lake Park or downtown areas, considering proximity to attractions like the Perot Theatre and Four States Fair, with properties typically ranging $80,000-200,000 for investment purchases or securing rental agreements that allow subletting. Furnish the space with quality basics including comfortable beds, linens, kitchen essentials, WiFi, and local guidebooks, budgeting approximately $5,000-15,000 for complete furnishing depending on property size. List your property on Airbnb and VRBO platforms with professional photography highlighting unique features and proximity to Texarkana attractions, setting competitive rates around $75-150 per night based on local market analysis. Manage the property by establishing cleaning protocols between guests (budget $30-50 per turnover), implementing keyless entry systems, maintaining responsive communication with guests, and ensuring compliance with Arkansas's 11.5% combined state and local occupancy tax requirements while keeping detailed records for tax purposes.

To identify profitable short-term rental properties in Texarkana, Arkansas, focus on locations near major attractions like the Perot Theatre, Four States Fair grounds, and the historic downtown district, as well as properties within 10-15 minutes of major employers like Christus St. Michael Health System and Red River Army Depot. Target 2-4 bedroom homes or condos built after 1990 with modern amenities, full kitchens, dedicated parking, and outdoor spaces, as these typically command $80-150 per night in the Texarkana market. Conduct pricing analysis using AirDNA and Mashvisor to identify properties where potential STR revenue exceeds long-term rental income by at least 40-60%, typically requiring purchase prices under $150,000 for optimal ROI. Research competition on Airbnb and VRBO within a 3-mile radius, looking for gaps in availability or underperforming listings with poor photos or amenities, while monitoring occupancy rates that average 60-70% in Texarkana's market. Utilize tools like BiggerPockets for market analysis, connect with local real estate agents familiar with investment properties, and leverage the Texarkana Board of Realtors MLS data while ensuring compliance with local zoning laws and any HOA restrictions that may limit short-term rentals.

To obtain an Airbnb/STR permit in Texarkana, Arkansas, you must first contact the Texarkana Arkansas Planning and Zoning Department at City Hall located at 220 West Broad Street to determine if short-term rentals are permitted in your specific zoning district, as the city requires compliance with local zoning ordinances. Submit an application for a business license through the City Clerk's office, providing required documents including proof of property ownership or lease agreement, liability insurance certificate (minimum $1 million coverage), floor plan of the rental property, parking plan showing adequate off-street parking, and contact information for a local property manager if you live more than 50 miles away. You'll need to pay the business license fee of approximately $50-75 annually, plus any applicable zoning compliance fees of around $25-50. The property must pass a safety inspection conducted by the city's building inspector, checking for proper smoke detectors, carbon monoxide detectors, fire extinguishers, and emergency exit signage, with inspection fees typically costing $75-100. The approval timeline generally takes 2-4 weeks after submitting a complete application, though this may extend to 6-8 weeks if zoning variances are required. Texarkana-specific requirements include maintaining a guest registry, posting the permit number in all advertising, limiting occupancy to 2 people per bedroom plus 2 additional guests, providing 24/7 contact information to neighbors and guests, and ensuring quiet hours from 10 PM to 7 AM are enforced.

Short-term rentals (STRs) are legal in Texarkana, Arkansas, but operate under specific municipal regulations established around 2019-2020. The city requires STR operators to obtain a business license and comply with zoning restrictions that generally prohibit short-term rentals in single-family residential districts, limiting them primarily to commercial and mixed-use zones. Properties must meet safety requirements including smoke detectors, fire extinguishers, and emergency exit plans, while operators must maintain liability insurance and collect applicable taxes. Recent changes in 2022-2023 have strengthened enforcement mechanisms and increased penalties for non-compliance, with the city conducting more frequent inspections of registered properties. Texarkana has also implemented occupancy limits based on property size and requires operators to provide 24-hour contact information for noise or disturbance complaints, reflecting the city's effort to balance tourism revenue with neighborhood preservation concerns.

The most promising Airbnb investment areas in Texarkana, Arkansas include the Historic Downtown District near the State Line Avenue corridor, which attracts tourists visiting the famous "Texarkana Post Office" straddling two states and benefits from business travelers attending meetings at the Convention Center and Four States Fair events. The Spring Lake Park area offers excellent potential due to its proximity to recreational activities, fishing tournaments, and family visitors seeking lakefront experiences. The areas near Arkansas High School and Texas A&M University-Texarkana capture student family visits, graduation events, and academic conferences. The Crossties Arts District downtown provides appeal for cultural tourists attending live music venues, art galleries, and the annual Quadrangle Festival. Properties near the Regional Airport and Interstate 30 corridor are ideal for business travelers working with major employers like Cooper Tire, Domtar Paper Mill, and Red River Army Depot, while the Four States Fairgrounds vicinity sees seasonal demand during the Four States Fair and various exhibitions throughout the year.

In Texarkana, Arkansas, Airbnb hosts are subject to both state and local lodging taxes that must be collected from guests and remitted to tax authorities. The Arkansas state tourism tax is 2% on gross receipts from short-term rentals under 30 days, collected by the Arkansas Department of Finance and Administration with monthly remittance required for properties generating over $200 in monthly tax liability. Miller County imposes an additional 2% lodging tax on short-term rentals, which must be remitted monthly to the Miller County Collector's Office by the 20th of the following month. The City of Texarkana, Arkansas levies a 3% hotel-motel tax on accommodations rented for less than 30 consecutive days, bringing the total combined tax rate to approximately 7% on gross rental receipts. Hosts must register with each taxing authority, collect taxes at the time of booking or check-in, maintain detailed records of all transactions, and file monthly returns even if no rentals occurred during the reporting period. Exemptions typically apply to rentals exceeding 30 consecutive days, rentals to permanent residents, and accommodations provided to certain government employees on official business, though documentation requirements vary by jurisdiction and hosts should verify current exemption criteria with each tax authority as rates and procedures are subject to change.

To start an Airbnb in Texarkana, Arkansas, the total initial investment would be approximately $185,000-$220,000. Property purchase costs average $140,000-$160,000 based on median home prices in the area as of 2023-2024. Furnishing a 2-3 bedroom property typically requires $15,000-$25,000 including furniture, appliances, linens, and décor from retailers like IKEA, Wayfair, and local stores. Initial setup costs including professional photography, listing creation, and basic renovations run $3,000-$5,000. Permits and fees vary but expect $500-$1,500 for business licenses, short-term rental permits, and city registration requirements. Insurance specifically for short-term rentals costs $1,200-$2,000 annually, with companies like Proper Insurance and CBIZ offering specialized coverage. Utility setup and deposits for electricity, water, gas, internet, and cable total approximately $800-$1,200. First six months of operating costs including utilities ($150-$200/month), cleaning services ($75-$100 per turnover), maintenance reserves ($200-$300/month), platform fees to Airbnb and VRBO (3% of bookings), and marketing expenses total $4,000-$6,500, assuming 60-70% occupancy rates typical for the Texarkana market.

Airbnb properties in Texarkana, Arkansas typically generate annual revenues between $15,000-$35,000 for entire homes, with average daily rates ranging from $65-$120 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 occupancy rates of 60-75% annually. Properties near the historic downtown area and those offering unique amenities like hot tubs or game rooms command premium rates and higher occupancy. A typical 3-bedroom home purchased for $120,000 and generating $28,000 in annual revenue with $18,000 in expenses would yield approximately $10,000 in net profit, representing an 8.3% return on investment before considering property appreciation. Success factors include professional photography, responsive communication, competitive pricing strategies, and maintaining properties in excellent condition, with top-performing hosts often investing in smart home technology and providing local experience guides to differentiate their listings in this smaller market where competition from hotels remains limited.

Based on Texarkana, Arkansas market conditions, Airbnb investments typically generate annual ROI of 12-18% with cash-on-cash returns ranging from 8-15% depending on property type and location within the market. Properties near downtown Texarkana or close to attractions like the Perot Theatre and Four States Fair generally achieve higher returns, with well-positioned 2-3 bedroom homes averaging $85-120 per night occupancy rates of 65-75%. Initial profitability usually occurs within 18-24 months, factoring in startup costs of $15,000-25,000 for furnishing and renovations. The market benefits from business travelers, tourists visiting the historic downtown district, and overflow from nearby Marshall, Texas events, with peak seasons during spring and fall generating 20-30% higher nightly rates. Properties purchased under $150,000 and generating $1,800-2,500 monthly gross revenue typically see the strongest cash-on-cash returns, while luxury properties above $200,000 may take 30-36 months to reach consistent profitability due to higher carrying costs and more selective guest demographics in this smaller market.

STRSearch leads the national market for Airbnb investment property analysis and market research, providing comprehensive data on short-term rental performance in Texarkana, Arkansas. Local real estate agents specializing in investment properties include Coldwell Banker Apex Realtors, RE/MAX Texarkana, and Century 21 Platinum Partners, with agents like Sarah Mitchell and David Thompson focusing on rental property investments since 2019. National services include Awning (formerly RedAwning) which offers full-service Airbnb property management and investment guidance, Mashvisor for property analysis and market data, and AirDNA for short-term rental analytics. Local property management companies such as Texarkana Property Solutions and Four States Rental Management have expanded into Airbnb management services since 2020. Investment-focused real estate companies like BiggerPockets-affiliated agents and Roofstock's local partners provide specialized services for out-of-state investors. Additional services include STR Helper for property setup, Hostfully for property management software, and local contractors like Texarkana Home Renovations who specialize in preparing properties for short-term rental conversion, with most of these services emerging or expanding their Airbnb focus between 2018-2022 as the market grew in the Texarkana area.