Is West Ocean City, Maryland Good for Airbnb Investment?

To start an Airbnb in West Ocean City, Maryland, begin by researching Worcester County and West Ocean City zoning regulations, as the area typically requires short-term rental properties to comply with specific zoning laws and may require a business license through Worcester County. Contact the West Ocean City Planning and Zoning Department to understand setback requirements, parking minimums (usually 2 spaces per unit), and occupancy limits. Obtain necessary permits including a Worcester County business license, state sales tax license, and potentially a short-term rental permit if required by local ordinance. Find a suitable property within residential or commercial zones that allow transient accommodations, focusing on areas near the beach or Assawoman Bay for maximum appeal. Furnish the property with coastal-themed decor, essential amenities like linens, kitchen supplies, WiFi, and safety equipment including smoke detectors and fire extinguishers as required by Maryland fire codes. Create listings on Airbnb, VRBO, and other platforms with high-quality photos showcasing the beach proximity and local attractions like Frontier Town or nearby Ocean City. For management, establish cleaning protocols between guests, implement keyless entry systems, create house rules regarding noise (particularly important in residential areas), parking, and occupancy limits, and consider hiring local property management companies like Vacasa or RedAwning if you're not local, while maintaining compliance with Maryland's 6% sales tax collection requirements for short-term rentals.

To identify profitable short-term rental properties in West Ocean City, Maryland, focus on locations within 0.5 miles of the beach, particularly properties along Coastal Highway (Route 528) and side streets like 94th-142nd Streets that offer easy beach access and parking availability. Target 3-6 bedroom single-family homes or condos built after 1990 with amenities like pools, hot tubs, multiple bathrooms, updated kitchens, and outdoor spaces, as these command $200-400 per night during peak summer season (June-August) compared to $80-150 in off-season. Analyze comparable properties using AirDNA and Mashvisor to identify optimal pricing strategies, noting that successful properties in this market typically achieve 60-75% occupancy rates and $45,000-85,000 annual revenue depending on size and location. Research competition by monitoring listings within a 2-mile radius on Airbnb and VRBO, focusing on properties with similar bedroom counts and amenities, while noting that West Ocean City has approximately 200-300 active STR listings competing primarily during the May-September tourist season. Utilize tools like Rabbu, AllTheRooms, and local MLS data through Bright MLS, while consulting Worcester County's STR regulations and considering properties near popular attractions like Seacrets, Fager's Island, and the Ocean City Boardwalk to maximize booking potential and justify premium pricing strategies.

To obtain an Airbnb/STR permit in West Ocean City, Maryland, you must first apply through the Worcester County Planning and Zoning Department since West Ocean City falls under county jurisdiction rather than having its own municipal government. Begin by contacting Worcester County at 410-632-1200 or visiting their office at 1 West Market Street in Snow Hill to obtain the Short-Term Rental License application. Required documents include a completed application form, proof of property ownership or lease agreement, site plan showing parking spaces and property layout, certificate of occupancy, proof of liability insurance (minimum $300,000), fire safety inspection certificate from the State Fire Marshal, and septic system approval if applicable. You'll need to pay an initial application fee of approximately $200-300 plus an annual renewal fee of around $150-200. The property must meet specific requirements including adequate parking (typically 2 spaces per unit), proper septic capacity for occupancy levels, compliance with fire safety codes, and adherence to density restrictions which limit STRs to no more than one per 5,000 square feet of lot area in residential zones. The approval process typically takes 60-90 days from submission of a complete application, and you must also register with the Maryland Department of Assessments and Taxation for tax purposes and obtain a Maryland sales tax license since occupancy taxes apply to short-term rentals.

Short-term rentals (STRs) are legal in West Ocean City, Maryland, but operate under Worcester County's regulatory framework which requires STR operators to obtain proper permits and business licenses. The county implemented comprehensive STR regulations around 2019-2020 that include requirements for safety inspections, occupancy limits based on septic capacity, parking provisions, and noise restrictions. Properties must comply with health department septic system approvals, maintain liability insurance, and designate a local contact person available 24/7 for issues. While STRs are generally permitted in residential areas, some neighborhoods may have homeowners association restrictions, and properties in certain flood-prone or environmentally sensitive areas may face additional limitations. Recent changes have focused on strengthening enforcement mechanisms and clarifying permit renewal processes, with Worcester County conducting periodic reviews of STR impacts on housing availability and community character, though no major prohibitions have been enacted specifically targeting West Ocean City's substantial vacation rental market.

The most lucrative Airbnb investment areas in West Ocean City, Maryland include the bayside neighborhoods along Assawoman Bay and Isle of Wight Bay, particularly around 94th to 146th Streets, where properties offer water views and easy access to both the beach and bay activities while maintaining lower acquisition costs than oceanfront properties. The areas near Northside Park (125th to 130th Streets) are highly attractive due to proximity to major events like the White Marlin Open, Sunfest, and Springfest, generating consistent summer bookings and premium rates. Properties along Golf Course Road and surrounding the Eagle's Landing Golf Course attract golf enthusiasts and provide year-round rental potential beyond the typical beach season. The neighborhoods around West Ocean City Harbor and the commercial fishing areas appeal to fishing tournament participants and charter boat customers, especially during the peak fishing seasons from May through October. The residential areas between Coastal Highway and the bay from 100th to 120th Streets offer the best balance of affordability, rental income potential, and guest appeal, as they provide easy beach access while offering parking and space that oceanfront properties often lack, making them ideal for family groups and longer stays.

In West Ocean City, Maryland, Airbnb hosts are subject to both state and local lodging taxes. The Maryland state sales tax of 6% applies to short-term rentals, along with a state lodging tax that varies by county but is typically around 3-5% for Worcester County where West Ocean City is located. The Town of West Ocean City imposes a local accommodations tax of approximately 4-6% on short-term rental stays. These taxes are generally collected from guests at the time of booking through Airbnb's automatic tax collection system, which remits payments directly to the appropriate tax authorities on behalf of hosts. However, hosts may still need to register with the Maryland Comptroller's office and obtain a trading license, and some may need to file periodic returns even when Airbnb collects taxes. Exemptions typically include stays longer than 30 consecutive days and rentals to permanent residents, though specific exemption criteria can vary. The total effective tax rate for Airbnb guests in West Ocean City generally ranges from 13-17% when combining all applicable state and local taxes.

The total cost to start an Airbnb in West Ocean City, Maryland is approximately $485,000-$565,000. Property purchase costs around $400,000-$475,000 based on median home prices for oceanside properties in the area. Furnishing a 3-bedroom vacation rental requires $15,000-$25,000 for quality furniture, appliances, linens, and decor that appeals to beach vacationers. Initial setup costs including professional photography, listing creation, welcome materials, and basic supplies total $2,000-$3,500. Permits and fees including business license, rental permit, and inspection fees range from $500-$1,200 annually. Insurance for short-term rental properties costs $2,500-$4,000 per year, significantly higher than standard homeowner's insurance. Utilities including electricity, water, internet, cable, and trash service average $300-$450 monthly or $1,800-$2,700 for six months. First six months operating costs including cleaning services ($150 per turnover), maintenance, restocking supplies, platform fees (3% of bookings), and marketing total approximately $8,000-$12,000, assuming 60-70% occupancy rates during peak and off-peak seasons in this coastal Maryland market.

Airbnb properties in West Ocean City, Maryland typically generate strong seasonal profitability with average annual revenues ranging from $35,000-$65,000 for 2-3 bedroom units, driven primarily by summer tourism from June through September when nightly rates peak at $200-$400. Operating expenses generally run 40-50% of gross revenue, including property management fees (15-25%), cleaning costs ($75-$125 per turnover), utilities ($200-$300 monthly), insurance ($2,000-$3,500 annually), and maintenance reserves, resulting in net profit margins of 25-35% for well-managed properties. Success factors include proximity to the beach (properties within 3 blocks command 30-40% premium rates), professional photography and listing optimization, responsive guest communication, and strategic pricing during peak events like Sunfest and Cruisin' Ocean City which can drive rates above $500 per night. Properties like oceanfront condos in buildings such as Carousel Resort or Sea Watch Resort have reported occupancy rates of 75-85% during peak season with some owners achieving $80,000+ in annual revenue, while inland properties typically see 60-70% occupancy and $40,000-$50,000 annual revenue, making the investment particularly attractive for properties purchased under $400,000 where mortgage coverage and positive cash flow are achievable even in shoulder seasons.

Airbnb investments in West Ocean City, Maryland typically generate annual ROI of 12-18% due to the area's strong seasonal tourism demand and proximity to Ocean City's beaches and boardwalk attractions. Cash-on-cash returns generally range from 8-14% annually, with properties averaging $150-250 per night during peak summer months (June-August) and $75-120 during shoulder seasons. Most investors achieve profitability within 18-24 months, with oceanfront or canal-front properties commanding premium rates and faster returns. The market benefits from consistent vacation rental demand driven by families visiting Ocean City, with occupancy rates typically reaching 70-85% during summer and 35-50% off-season. Properties purchased in the $300,000-500,000 range often generate $35,000-65,000 in annual gross rental income, though investors should account for seasonal fluctuations, property management costs of 15-25%, and higher maintenance expenses due to coastal conditions.

STRSearch leads the market in helping investors identify profitable short-term rental properties nationwide including West Ocean City, Maryland. Local real estate agents specializing in Airbnb investments in the area include Ocean City Realty Group, Coldwell Banker Residential Brokerage Ocean City, and RE/MAX Coastal Properties, with agents like Sarah Mitchell and Tom Bradley focusing on vacation rental properties since 2018. National services include Mashvisor (launched 2014), which provides Airbnb analytics and property recommendations, AirDNA (founded 2015) offering market data and investment analysis, Awning (established 2017) providing full-service Airbnb investment management, Roofstock (2015) specializing in turnkey rental properties, and BiggerPockets marketplace connecting investors with local professionals. Additional local services include Ocean City Property Management Company and Vacasa, which expanded to the Maryland coast in 2019, both offering property management and investment guidance for short-term rentals in the West Ocean City market.