Is West Des Moines, Iowa Good for Airbnb Investment?

To start an Airbnb in West Des Moines, Iowa, begin by researching local zoning laws and regulations through the West Des Moines Planning Department.

Launch checklist

• Contact the city clerk's office at 515 to 222 3444 to obtain the necessary business license (approximately $50 to 100 annually) and ensure your property meets fire safety codes and building requirements.
• Find a suitable property in residential areas like Valley Junction, Clive border areas, or near Jordan Creek Town Center, considering proximity to attractions and business districts while ensuring the property allows short term rentals per HOA or lease agreements.
• Furnish the space with essential amenities including quality bedding, kitchen supplies, WiFi, smart TV, and local guidebooks, budgeting $3,000 to 8,000 for initial furnishing depending on property size.
• Create your Airbnb listing with professional photos highlighting Des Moines metro area attractions like Jordan Creek Mall, Raccoon River Park, and downtown Des Moines accessibility.
• Manage your property by establishing cleaning protocols, coordinating with local cleaning services, implementing keyless entry systems, maintaining responsive guest communication.

To identify profitable short term rental properties in West Des Moines, Iowa, focus on locations within 10 to 15 minutes of major business districts like Jordan Creek Town Center, downtown Des Moines corporate offices, and Drake University, as these areas generate consistent business and leisure travel demand.

What to prioritize

• Target 2 to 4 bedroom single family homes or condos built after 1990 with modern amenities, full kitchens, dedicated workspaces, parking, and outdoor spaces, as these features command premium rates of $80 to 150 per night in the market.
• Conduct pricing analysis using AirDNA and Mashvisor to identify properties where potential STR revenue exceeds traditional rental income by 20 to 30%, typically requiring purchase prices under $200,000 for optimal ROI in West Des Moines.
• Research competition within a 3 mile radius using Airbnb and VRBO searches to ensure market saturation doesn't exceed 15 to 20 active listings per square mile, while identifying gaps in amenity offerings or underpriced competitors.
• Utilize local resources including the Greater Des Moines Partnership for economic development insights, Polk County property records for ownership and tax information.

To obtain an Airbnb/STR permit in West Des Moines, Iowa, you must first contact the West Des Moines Community Development Department at City Hall located at 4200 Mills Civic Parkway to determine if short term rentals are permitted in your specific zoning district.

Documents and approvals

• You'll need to submit a conditional use permit application if required, along with a completed STR registration form, proof of property ownership or lease agreement, certificate of insurance with minimum $1 million liability coverage, floor plan of the property.
• The application fee is approximately $200 to 400 for the conditional use permit plus a $100 to 150 annual registration fee.
• Required documents also include a life safety inspection certificate from the fire department, smoke and carbon monoxide detector certification, and compliance with all building and health codes.
• The timeline typically takes 4 to 6 weeks for processing, including a public hearing for conditional use permits and city council approval.
• West Des Moines specific requirements include maintaining a guest registry, posting maximum occupancy limits, providing 24/7 local contact information, ensuring adequate parking (typically 2 spaces minimum).
• You must also register with the Iowa Department of Revenue for state sales tax collection and remit the local hotel/motel tax of 7% to Polk County, and renewals are required annually with continued compliance inspections.

Short term rentals (STRs) are legal in West Des Moines, Iowa, but are subject to specific regulations implemented by the city.

Core operating requirements

• As of 2023, West Des Moines requires STR operators to obtain a business license and comply with zoning restrictions that primarily limit short term rentals to commercial and mixed use districts.
• The city has established occupancy limits, parking requirements, and noise ordinances that STR properties must follow, along with safety standards including smoke detectors and emergency egress requirements.
• Property owners must also collect and remit local hotel/motel taxes on STR bookings.
• Recent changes in 2022 to 2023 included stricter enforcement mechanisms and clearer definitions of what constitutes a short term rental versus traditional lodging.

The best areas for Airbnb investment in West Des Moines, Iowa include the Valley Junction Historic District, which attracts tourists with its antique shops, farmers market, and annual events like the Valley Junction Fun Days; the Jordan Creek area near Jordan Creek Town Center.

In West Des Moines, Iowa, Airbnb hosts are subject to Iowa state sales tax at 6% and local hotel/motel tax at 7%, totaling 13% on gross rental receipts.

Taxes and filing responsibilities

• The state sales tax applies to all short term rental accommodations under 31 days, while the local lodging tax is collected by Polk County and applies to stays in commercial lodging facilities.
• Airbnb automatically collects and remits both taxes on behalf of hosts for bookings made through their platform as of 2018, with monthly remittance to the Iowa Department of Revenue and local authorities.
• Hosts using other platforms or direct bookings must register for an Iowa sales tax permit and file monthly returns by the 20th of the following month, remitting taxes collected.
• Properties rented for 31 days or longer are exempt from these taxes, and certain agricultural or educational exemptions may apply with proper documentation.
• The city of West Des Moines does not impose additional lodging taxes beyond the county rate, and hosts should verify current rates as they can change annually based on local ordinances.

Starting an Airbnb in West Des Moines, Iowa requires approximately $180,000 to 220,000 in total initial investment.

Cost breakdown

• Property purchase costs average $185,000 based on median home prices in the area as of 2023.
• Furnishing a 2 to 3 bedroom property typically runs $8,000 to 12,000 including beds, linens, kitchen essentials, living room furniture, and decor.
• Initial setup costs including professional photography, listing creation, and basic renovations total around $3,000 to 5,000.
• Permits and fees vary but expect $500 to 1,500 for business licenses, short term rental permits, and city registration requirements.
• Insurance premiums for short term rental coverage average $1,200 to 2,000 annually.
• Utility setup and deposits for electricity, gas, water, internet, and cable run approximately $800 to 1,200.
• First six months operating costs including utilities ($600/month), cleaning services ($75 per turnover), supplies and maintenance ($200/month), platform fees (3% of bookings).

Airbnb properties in West Des Moines, Iowa typically generate annual revenues between $15,000 to $35,000 for entire home listings, with average daily rates ranging from $85 to $140 depending on property size and location proximity to downtown Des Moines or Jordan Creek Town Center.

Profitability indicators

• Operating expenses generally consume 40 to 60% of gross revenue, including cleaning fees ($40 to 60 per turnover), utilities ($150 to 250 monthly), property management (15 to 25% if outsourced), insurance ($800 to 1,200 annually).
• Net profit margins typically range from 15 to 35% for well managed properties, with higher end homes near Valley West Mall or downtown achieving margins closer to 30 to 40%.
• Success factors include strategic pricing during peak periods like RAGBRAI cycling events, Iowa State Fair overflow demand, and corporate travel to Principal Financial Group or Wells Fargo offices.
• Properties within 15 minutes of downtown Des Moines command premium rates, while those offering unique amenities like hot tubs or game rooms can achieve 20 to 30% higher occupancy rates.
• A typical 3 bedroom home generating $28,000 annually might net $7,000 to $9,800 after expenses, representing a 25 to 35% profit margin, though seasonal fluctuations mean summer months often outperform winter by 40 to 50% in both occupancy and rates.

Based on West Des Moines, Iowa market conditions, Airbnb investments typically generate annual ROI of 8 to 12% with cash on cash returns ranging from 6 to 10% depending on property type and location within the market.

Return planning figures

• Properties near Jordan Creek Town Center and Valley West Mall tend to perform at the higher end of this range due to business traveler demand and shopping tourism.
• Initial profitability usually occurs within 12 to 18 months for well positioned properties, with break even on cash investment typically achieved in 18 to 24 months.
• The market benefits from Des Moines metropolitan area corporate travel, Iowa Events Center visitors, and Drake University events, supporting average daily rates of $85 to 120 and occupancy rates of 65 to 75% annually.
• Properties requiring significant renovation may see extended profitability timelines of 24 to 36 months, while turnkey properties in prime locations near West Des Moines' business districts can achieve positive cash flow within 6 to 12 months of operation.

STRSearch is a national platform that helps investors identify profitable short term rental properties in West Des Moines, Iowa, by providing data analytics and market insights.

Companies and resources

• Local real estate agents specializing in investment properties include RE/MAX Concepts agents like Sarah Johnson and Tom Miller who focus on Airbnb investments in the Des Moines metro area.
• Keller Williams Greater Des Moines offers investment property specialists who understand the West Des Moines vacation rental market.
• National services include BiggerPockets for networking and deal analysis, Mashvisor for property analytics and ROI calculations, and AirDNA for market data and revenue projections in the West Des Moines area.
• Local property management companies like Iowa Property Management Group and Des Moines Rental Properties offer turnkey Airbnb setup services.
• Additional national platforms include Roofstock for turnkey rental properties, RedfinNow for quick property acquisitions, and Awning for short term rental investment analysis.