Is Versailles, Kentucky Good for Airbnb Investment?

Potentially—Versailles, Kentucky combines visitor demand with long-term real estate upside.

• Presents a unique opportunity given the city's strategic location and equestrian heritage.
• Versailles' market is characterized by its proximity to Lexington, the heart of Kentucky's Bluegrass region.
• The city's charm as a historic small town combined with its accessibility to major attractions supports steady occupancy rates for short-term rentals.
• While property values remain relatively affordable compared to larger metropolitan areas, making initial investments more accessible, the potential for consistent rental income is driven by equestrian tourism.
• Investors should, however, consider the seasonal nature of tourism and local zoning regulations, which can impact profitability and operational flexibility.

$800–$1,500 per month based on location, season, and property quality.

• Based on available market data and regional analysis, Airbnb hosts in Versailles, Kentucky typically earn between $800-$1,500 per month.
• Seasonal variations show peak earnings during spring and fall months when Kentucky's horse racing season and favorable weather drive tourism.
• Summer months generally see moderate performance, while winter typically represents the lowest earning season with potential decreases of 20-30% from average rates.
• Key factors affecting earnings include proximity to Keeneland Race Course (approximately 15 minutes away), property size and quality, professional photography, competitive pricing strategies.
• Properties that successfully market to equestrian tourists, business travelers visiting nearby Lexington, and families exploring the Bluegrass region tend to achieve occupancy rates of 60-75% annually.

Potentially strong—typical annual ROI is 8–12%.

• Typically generate ROI between 8-12% annually, with payback periods averaging 7-9 years for properties purchased in the $200,000-$350,000 range that characterizes the local market.
• Short-term rental properties in Versailles can command $120-$180 per night during peak seasons due to proximity to Keeneland Race Course and bourbon trail attractions.
• This performance generally exceeds traditional long-term rentals in the area by 2-4 percentage points.
• The higher returns from Airbnb operations come with increased management complexity and seasonal fluctuations, particularly during horse racing seasons and bourbon tourism peaks in spring and fall.

Versailles, Kentucky averages 45–55% annual occupancy, with seasonal variation.

• Airbnb occupancy rates in Versailles, Kentucky typically average around 45-55% annually, with significant seasonal variations that peak during Kentucky Derby season in early May and fall foliage season in October.
• Summer months (June-August) generally see occupancy rates of 60-65% due to tourism and horse farm visits, while winter months (December-February) drop to approximately 35-40%.
• Spring and fall shoulder seasons maintain moderate occupancy around 50-55%, with the Keeneland racing seasons in April and October providing additional boosts.
• Compared to Kentucky's statewide Airbnb average of approximately 50-60%, Versailles performs slightly below due to its smaller tourism market.
• Nationally, where Airbnb occupancy rates average 48-52%, Versailles falls within the typical range but experiences more pronounced seasonal swings due to its reliance on equestrian tourism and Derby-related travel.

The strongest opportunities balance visitor demand, nightly rates, and acquisition cost.

• The downtown Versailles historic district offers excellent Airbnb potential due to its charming 19th-century architecture, walkability to local restaurants and shops.
• The Woodford Reserve area neighborhoods benefit from proximity to the famous bourbon distillery, attracting whiskey tourism and corporate visitors.
• Neighborhoods near Keeneland Race Course, particularly those within 10-15 minutes drive, see exceptional seasonal demand during racing seasons with rates reaching $200-300 per night.
• The Pisgah Pike corridor attracts equestrian tourists visiting the numerous horse farms, offering steady mid-range pricing of $90-140 per night with guests appreciating rural charm while maintaining reasonable access to Lexington.
• Areas around Versailles State Park provide nature-focused accommodations for outdoor enthusiasts, families, and retreat groups.
• The US-60 West neighborhoods offer convenient access to both Versailles attractions and Frankfort, appealing to government workers and tourists exploring multiple destinations.
• Finally, the established residential areas near Woodford County High School provide family-friendly accommodations for visiting relatives and sports teams.

Yes, but only where zoning permits short-term rentals and every required license is current.

• Short-term rental regulations in Versailles, Kentucky are primarily governed at the county level through Woodford County ordinances.
• Properties must comply with occupancy limits typically set at two persons per bedroom plus two additional guests, with a maximum of 10-12 occupants depending on the specific zoning district.
• Owner-occupancy is not required for short-term rentals, but properties must meet all building and fire safety codes, maintain adequate parking (usually two spaces minimum).
• The registration process involves submitting an application to Woodford County Planning and Zoning, paying permit fees ranging from $200-400, providing proof of liability insurance.
• Zoning restrictions limit short-term rentals primarily to agricultural and some residential districts.
• Recent changes implemented around 2022-2023 have included enhanced enforcement mechanisms, mandatory registration renewals every two years.

Tax rates vary by jurisdiction; licensing, inspection, and insurance costs are additional.

• Short-term rentals in Versailles, Kentucky are subject to Kentucky's state transient room tax of 1% on gross rental receipts, plus Woodford County's local transient room tax of approximately 3%.
• Property owners must obtain a transient room tax license from the state, which typically costs around $15 annually.
• The city of Versailles may require a business license costing approximately $25-75 annually depending on the rental's gross receipts.
• Additionally, operators must comply with Kentucky's sales tax of 6% on any additional services or amenities provided beyond basic lodging.
• Some properties may also need special zoning permits or conditional use permits with application fees ranging from $100-300, and annual renewal fees of $50-150.