Is Tomahawk, Wisconsin Good for Airbnb Investment?

To start an Airbnb in Tomahawk, Wisconsin, begin by researching local zoning laws and regulations through the City of Tomahawk Planning Department, as the city may require short-term rental permits and compliance with residential zoning restrictions. Contact Lincoln County for any county-level requirements and ensure your property meets Wisconsin state tax obligations including sales tax registration with the Department of Revenue. Find a suitable property in residential areas that allow short-term rentals, focusing on locations near Lake Mohawksin or downtown attractions that appeal to tourists visiting the Northwoods region. Obtain necessary permits from Tomahawk City Hall, which typically includes a business license and potentially a short-term rental permit (estimated cost $50-200), and ensure the property passes safety inspections including smoke detectors, carbon monoxide detectors, and meets occupancy limits. Furnish the property with essential amenities like linens, towels, kitchen supplies, WiFi, and outdoor equipment suitable for Wisconsin's recreational activities such as fishing gear or winter sports equipment. Create your Airbnb listing with high-quality photos showcasing the property's proximity to outdoor activities, lakes, and seasonal attractions, setting competitive rates based on similar properties in the area (estimated $80-150 per night depending on size and season). Manage the property by establishing cleaning protocols between guests, maintaining responsive communication, and potentially partnering with local cleaning services or property management companies in the Tomahawk area, while staying compliant with ongoing tax reporting requirements to both state and local authorities.

To identify profitable short-term rental properties in Tomahawk, Wisconsin, focus on locations within 1-2 miles of Lake Mohawksin, Lake Nokomis, or other major water bodies, as well as properties near snowmobile trails and the Hiawatha Trail for year-round appeal. Target 2-4 bedroom cabins or homes with lake access, docks, fire pits, and outdoor amenities that can accommodate 6-12 guests, as these command premium rates of $150-300 per night during peak summer and winter seasons. Analyze comparable properties on Airbnb and VRBO within a 10-mile radius, noting that successful properties typically achieve 60-70% occupancy rates with average daily rates varying from $120 in shoulder seasons to $250+ during fishing opener, summer holidays, and snowmobile season. Research competition by monitoring 20-30 similar properties for pricing patterns, amenities offered, and guest reviews, while utilizing tools like AirDNA, Mashvisor, and local MLS data to assess purchase prices against potential rental income. Leverage resources such as the Tomahawk Chamber of Commerce for event calendars, Wisconsin DNR for fishing and hunting season dates, and local property management companies like Vacasa or RedAwning for market insights, ensuring your investment targets properties under $300,000 that can generate 15-25% annual returns through strategic pricing and marketing to outdoor enthusiasts visiting this popular Northwoods destination.

To obtain an Airbnb/STR permit in Tomahawk, Wisconsin, you must first contact the Tomahawk City Clerk's office at City Hall located at 626 Lincoln Avenue to inquire about their short-term rental ordinance and application process. You'll need to submit a completed STR permit application form along with required documents including proof of property ownership or lease agreement, a detailed floor plan of the rental unit, proof of liability insurance (typically $1 million minimum), a site plan showing parking areas and emergency exits, and contact information for a local property manager if you're not residing within 50 miles of the property. The application fee is estimated at $150-250 annually, with additional inspection fees of approximately $75-100. You must also provide documentation showing compliance with Wisconsin Department of Safety and Professional Services building codes, fire safety requirements including smoke and carbon monoxide detectors, and maximum occupancy limits based on square footage. The city requires a safety inspection by the local fire department and building inspector before permit approval. Submit all materials to the City Clerk's office and allow 30-45 days for processing, which includes the inspection period and potential city council review. Once approved, you must display your permit number in all online listings and renew annually by December 31st, maintaining guest registries and adhering to noise ordinances and parking restrictions specific to your property's zoning district.

Short-term rentals (STRs) are generally legal in Tomahawk, Wisconsin, as the city has not enacted specific prohibitions against vacation rentals or short-term accommodations. However, STR operators must comply with standard zoning regulations, business licensing requirements, and health department standards that apply to transient lodging facilities. Properties used as STRs typically need to be located in areas zoned for commercial or mixed-use activities, or in residential zones where home-based businesses are permitted. The city requires proper permits and may impose occupancy limits, parking requirements, and noise restrictions to minimize impacts on residential neighborhoods. Wisconsin state law generally allows municipalities to regulate STRs through local ordinances, and Tomahawk has maintained a relatively permissive approach while ensuring compliance with building codes, fire safety standards, and tax collection requirements. Property owners should verify current zoning compliance and obtain necessary business licenses before operating STRs, as regulations can change and enforcement has become more systematic in recent years across Wisconsin communities.

The best areas for Airbnb investment in Tomahawk, Wisconsin are the Lake Mohawksin waterfront district, downtown Tomahawk near the historic business district, and the Willow Flowage area. The Lake Mohawksin waterfront is highly attractive due to its prime location for fishing, boating, and water recreation activities that draw tourists year-round, particularly during summer months and ice fishing season. Downtown Tomahawk offers proximity to local restaurants, shops, and the Tomahawk Regional Airport, making it convenient for both leisure travelers and occasional business visitors to the area's logging and tourism industries. The Willow Flowage region appeals to outdoor enthusiasts seeking fishing, hunting, and nature experiences, with properties here commanding premium rates during peak outdoor recreation seasons from May through October and again during winter sports months.

In Tomahawk, Wisconsin, Airbnb hosts are subject to Wisconsin state sales tax of 5% and room tax of 5% on lodging rentals, totaling 10% in state-level taxes. Lincoln County may impose an additional room tax of up to 8%, and the City of Tomahawk can levy a local room tax of up to 8%, though the typical combined local rate is approximately 3-5%. These taxes apply to rentals of less than 30 consecutive days and are collected from guests at the time of booking, with Airbnb automatically collecting and remitting Wisconsin state taxes for hosts through their platform since 2019. For local taxes, hosts may need to register directly with Lincoln County and the City of Tomahawk, obtain tax permits, file monthly or quarterly returns, and remit collected taxes by the 20th of the following month. Exemptions typically include stays of 30 days or longer, certain government employees on official business, and some nonprofit organization stays, though documentation may be required to claim exemptions.

The total cost to start an Airbnb in Tomahawk, Wisconsin is approximately $185,000-$225,000. Property purchase costs around $150,000-$180,000 based on median home prices in the Tomahawk area as of 2023-2024. Furnishing costs typically range $8,000-$15,000 for a complete 2-3 bedroom property including beds, linens, kitchen essentials, living room furniture, and décor. Initial setup costs including professional photography, listing creation, and basic marketing materials run $500-$1,500. Permits and fees in Wisconsin include business registration ($35), potential short-term rental permits ($100-$300 depending on local ordinances), and tax registration which is typically under $100. Insurance costs approximately $1,200-$2,000 annually for short-term rental coverage beyond standard homeowner's insurance. Utility setup and deposits for electricity, water, gas, internet, and cable run $300-$800 initially. First six months operating costs including utilities ($200-$400/month), cleaning supplies and services ($150-$300/month), maintenance reserves ($100-$200/month), platform fees to Airbnb and VRBO (3% of bookings), and marketing expenses total approximately $3,000-$6,000, assuming moderate occupancy rates during the initial period.

Airbnb properties in Tomahawk, Wisconsin typically generate annual revenues of $15,000-$35,000 for lakefront cabins and $8,000-$18,000 for standard properties, with occupancy rates averaging 45-65% during peak summer months (June-August) and dropping to 15-25% in winter. Operating expenses including property management (10-15% of revenue), cleaning fees ($75-125 per turnover), utilities ($200-400 monthly), insurance ($1,200-2,000 annually), and maintenance ($2,000-4,000 yearly) typically consume 40-60% of gross revenue. Profit margins range from 25-45% for well-managed properties, with lakefront and snowmobile-accessible cabins commanding premium rates of $150-300 per night versus $80-150 for standard homes. Success factors include proximity to Lake Mohawksin, Willow Flowage, or snowmobile trails, professional photography, responsive guest communication, and seasonal pricing strategies that capitalize on fishing tournaments, fall foliage, and winter recreation activities. Properties within walking distance of downtown Tomahawk or featuring amenities like hot tubs, fire pits, and boat access consistently outperform the market, with some owners reporting net profits of $12,000-$20,000 annually on properties purchased for $150,000-$250,000.

Airbnb investments in Tomahawk, Wisconsin typically generate annual ROI of 8-12% with cash-on-cash returns ranging from 6-10%, driven by the area's proximity to Lake Mohawksin and seasonal tourism demand. Properties near the waterfront or downtown area command higher nightly rates of $80-150 during peak summer and fall seasons, with occupancy rates averaging 55-65% annually. Initial profitability usually occurs within 18-24 months for well-positioned properties, with investors seeing break-even on cash invested by month 20-30 depending on renovation costs and financing structure. The market benefits from consistent demand from fishing enthusiasts, snowmobilers, and families seeking lakefront retreats, though winter months typically see 30-40% lower occupancy rates. Properties requiring minimal renovation and priced under $200,000 tend to achieve the higher end of ROI ranges, while luxury lakefront investments may see 10-15% annual returns but require longer payback periods of 3-4 years due to higher initial capital requirements.

STRSearch leads the national market for Airbnb investment property analysis and market research, providing comprehensive data on short-term rental performance in Tomahawk, Wisconsin. Local real estate agents specializing in investment properties include Coldwell Banker Mulleady-Er in nearby Rhinelander (2019-present), Century 21 Burkett & Associates serving the Tomahawk area, and RE/MAX North Winds Realty with agents experienced in vacation rental properties. National services include Mashvisor for property analysis and market data, BiggerPockets for investor networking and deal sourcing, Awning for short-term rental market analytics, and AirDNA for Airbnb performance metrics in the Wisconsin Northwoods region. Local property management companies like Northwoods Property Management and Vacation Rental Pros Wisconsin assist with ongoing operations, while investment-focused firms such as Roofstock and Arrived Homes occasionally feature Wisconsin lake properties. Regional mortgage brokers including First Weber and Associated Bank provide financing specifically for investment properties in recreational markets like Tomahawk's lake district.