Airbnb Hudson FL: Should You Invest?

In this article we will discuss whether Airbnb Hudson FL is a smart investment destination.

Hudson is a small city in Pasco County in Florida. Very little is known about this place, but its rapidly rising economy and its fantastic beaches and warm weather make it attractive to many travelers and vacationers. People seeking a break to bask in warm-weather outdoor activities will find Hudson a delight from mid-March to mid-May and again from mid-October to late November when the weather is pleasant, and Hudson is rain-free. Beach lovers who don’t mind hot weather would have more fun if they visit Hudson from late April to mid-June and from late September to late October.

With that said, is it wise to invest in Airbnb Hudson FL?

This article zooms in on the investment potential of Airbnb in Hudson as it explores the following:

• Reasons for purchasing an Airbnb property in Hudson FL
• The legal aspect of Airbnb Hudson FL
• Making the most of your Airbnb investment in Hudson FL

First-time real estate investors, especially those looking into a short term rental, would benefit from this article.

What Is Airbnb?

Let’s begin with the basics.

Airbnb is an online marketplace connecting guests to hosts renting out lodging space for a short duration, usually a maximum of one month. Nowadays, Airbnb is used alternatively to refer to a short term property rental, such as a vacation home. From the perspective of guests, Airbnb provides a cheaper, more personalized alternative to staying in a hotel.

For hosts, Airbnb is a short term rental strategy for making money in real estate. A listed Airbnb property typically commands higher daily or weekly rates than traditional rental properties. You may even charge higher weekend rates, allowing you to maximize your Airbnb rental income.

Review of the Florida Real Estate Market

2021 was a banner year for the Florida housing market. According to the year-end report of Florida Realtors, 2021 closed with a total sales of more than 528,000 units, increasing by 19% year-over-year (YOY). This figure translates into $241 billion, a YOY climb of more than 48%. The median sales price for single-family homes surged 20% YOY, reaching $348,000. The report cited a 7.1% increase in new listings from 2020.

Specifically, the Hudson market for Airbnb registered the following figures as of December 2021, according to Airbnb data provided by Mashvisor:

• Airbnb Cash on Cash Return: 2.79%
• Monthly Airbnb Rental Income: $1,982
• Airbnb Daily Rate: $124
• Airbnb Occupancy Rate: 50%
• Airbnb Listings: 127
• Median Property Price: $402,475
• Average Price per Square Foot: $232
• Listings for Sale: 76
• Days on Market: 103
• Walk Score: 60

The predictions for the Florida housing market promise yet another bright year; perhaps, not as great, but still positive. As the Florida real estate market booms and the forecast of higher prices and supply shortage looms, the potential of the Hudson housing market as a tourist destination and investment location is ready to be tapped.

But what is there in the Hudson real estate market that will attract investors and clients alike?

Why Invest in Airbnb Hudson FL?

With more people discovering the beauty of Hudson, Florida, the prospects of investing in short term rentals are getting brighter. Aside from traditional rentals, first-time and seasoned investors are looking to list a property on Airbnb to bank on its growing popularity.

But, like any other investment, you need to assess if your rental property will bring you the desired profit; otherwise, it defeats the purpose of investing in real estate. To determine the potential of investing in Airbnb Hudson FL, you need to consider three factors, namely:

• Livability
• Lifestyle preferences
• Hudson housing market

Livability

Overall, Hudson FL’s livability score of 77, which factors the cost of living and crime rate, is above average.

Cost of Living

Cost of living is a key factor in choosing a place for travel or investment, especially if you need to keep a budget. Hudson has the cost of living lower than the national average and that of most cities in Florida. Specifically, grocery items, health care, transportation, housing costs, utilities, and miscellaneous goods and services, are less expensive.

Crime

Compared to suburban areas nationwide – and state-wide, Hudson’s crime rate is lower, which means people can stay in the city with less worry for their safety and security.

Lifestyle Preferences

Besides the pleasant weather, what other attractions draw people to Hudson, FL?

Hudson has something for everyone, whether traveling solo, with friends, kids, on a limited budget, looking for adventure, or just wanting to have fun. It has fun attractions such as recreational waterfront facilities, a mermaid show, and more. Foodies will also have a blast with various food places, each giving its guests a unique dining experience. Its magnificent beaches and great parks are also worth exploring. The more adventurous can indulge in indoor and outdoor activities that include boat tours and water sports or visit games and entertainment centers. People into the arts can go to concerts and theater, while shopaholics can visit Hudson’s Treasure Trove Mini Mall and Consignments.

Hudson Housing Market

Hudson has 14 neighborhoods, with Driftwood Isles being the most expensive neighborhood with a median listing home price of $585,500 and Clayton Village being the most affordable with a median listing home price of $233,500.

Realtor.com shares the following data as of December 2021:

• Median Listing Home Price: $295,000, up by almost 26% YOY
• Median Listing Home Price per Square Foot: $173
• Median Home Sold Price: $282
• Sale-to-List Price Ratio: 100%, which means that Hudson houses sold for almost their listing price on average
• Median Days on the Market: 46 days
• Seller’s Market, which means there are more buyers than housing inventory

With high prices and supply shortages expected to continue until sometime mid-year, the demand for rentals will continue to rise.

As of January 2022, a real estate market analysis of the Airbnb Hudson FL, conducted by Mashvisor, yielded the following market performance:

• Airbnb Cash on Cash Return: 2.91%
• Monthly Airbnb Rental Income: $2,100
• Airbnb Daily Rate: $128
• Airbnb Occupancy Rate: 52%
• Airbnb Listings: 144
• Median Property Price: $404,821
• Average Price per Square Foot: $241
• Listings for Sale: 79
• Days on Market: 101
• Walk Score: 60

The city’s average Airbnb cash on cash return is enough to give you a positive cash flow but leaves much to be desired. However, when looking at this Airbnb rental market analysis, you should consider that these are just the average values for the market, while individual rental properties for sale yield significantly better results. In specific, properties with high Airbnb demand are guaranteed to bring good return on investment.

Real estate investing can be a lucrative business, but you need to do a lot of hard work and research to understand the market better and prepare yourself for the challenges that lie ahead.

For starters, let’s look at the short term rental regulations that rule the local market:

Laws Governing Airbnb Hudson

State laws govern businesses, and since running an Airbnb is considered a business, you need to know and understand these laws before jumping into the Airbnb bandwagon. For example, Pasco County, where Hudson is located, does not allow short term rental for periods of less than six days at a time.

Below is a rundown of the laws to get you started.

Licensing

Florida law requires that all vacation rentals be licensed through the Florida Department of Business and Professional Regulation (DBPR). The law defines a vacation rental as “any unit or group of units in a condominium or cooperative or any individually or collectively owned single-family, two-family, or four-family house or dwelling unit that is also a transient public lodging establishment but that is not a timeshare project.”

The law applies to properties rented out as an entire unit more than three times within a calendar year for periods of one calendar month or 30 days, whichever is less. It is also enforced on properties advertised or publicly declared as properties regularly rented to guests.

However, hosted rentals, or short term rentals where the host resides in the vacation rental property, are exempted from the licensing requirement but are covered by other relevant regulations.

Applying for a License

You may apply for a license online and allow one or two business days for application processing. Use the correct application form to avoid any delay in processing. The law categorizes a vacation rental into two: condominiums and dwellings. DBPR requires a separate license application for each. If you have more than one rental property, be sure to register each rental unit address through your DBPR Online Services account.

Once approved, you will receive your digital license through your registered email address. A single license may be issued for a single-family home or condominium or two or more units within a single building owned and run by the same individual or entity, except a licensed agent.

Application Fees

DBPR bases its fees on the application date. Always check the renewal date to ensure that you don’t pay within a few days or weeks from paying your initial application to renew your license for the next year. Do not apply yet if you don’t plan on renting out your property until the next renewal date. Use DBPR’s fee calculator to determine licensing fees.

Keeping Your License

As an Airbnb property owner or host, you are responsible for providing your guests the best experience while complying with state laws. Observe the following to avoid license revocation:

• Display current licenses or copies of them within the property premises.
• Keep the unit well-maintained.
• Disinfect the unit and replace beddings and linens once a week or in-between guests, whichever comes first.
• If provided, sanitize dishes and glassware between guests.
• If provided, ensure that baby cribs, furniture, home appliances, and equipment satisfy the Consumer Products Safety Commission’s safety standards.
• Implement adequate pest control measures.

Taxes

Guests booking Airbnb listings in Florida must pay taxes which are part of their reservation fee, which means Airbnb collects and remits sales tax on behalf of Airbnb hosts across Florida. Airbnb also collects and remits Tourism Development Taxes (TDT) on behalf of Florida hosts listed on its platform. Airbnb hosts are not entitled to homestead exemption. To learn more about the homestead exemption, visit the Florida Department of Revenue website.

Other Relevant Rules and Regulations

The rules that govern Airbnb are not limited to licensing and taxation. Consult Pasco County for relevant regulations and ordinances.

If your property is mortgaged or on a lease, check out the agreements and clarify the rules, if needed. Understand the Homeowners’ Association (HOA) rules, condo board, or co-op rules.

Disclaimer: The information shared in this section may have been updated since this article was written. We advise you to check with Pasco County and the other regulatory bodies mentioned here before buying an Airbnb rental property.

Selecting the Best Airbnb Hudson FL Property

You may be investing in an Airbnb property to get you started on real estate investing or add to your real estate portfolio. Either way, you need to carefully select your rental property to ensure that you get an attractive Airbnb rental income.

Finding the best Airbnb Hudson FL investment property can be complicated and time-consuming, so it would serve you well to use a property investment tool like Mashvisor. Here is how we can help you:

1. Provide You with a General Outlook of Airbnb in Hudson FL

Scouring the local market for the best location to invest in an Airbnb is a tedious task and might take months before you can complete it. Mashvisor’s Property Search feature allows you to do that in just a few minutes.

Type in “Hudson, FL” in the search box to display the location’s map. When you click on the drop-down arrow beside Heat Map Dataset, you will be prompted to select a criterion from the following metrics:

• Traditional Cash on Cash Return
• Airbnb Cash on Cash Return
• Airbnb Rental Income
• Traditional Rental Income
• Listing Price
• Airbnb Occupancy Rate

Once you have selected a criterion, a real estate heat map will be displayed to identify the high-performing areas based on your criterion. These are the green-shaded areas on the map, while the red areas point to the low-performing areas. The heat map will help you quickly identify the neighborhood that best suits your needs, but you must be clear on your investment goals so you can select the right criterion.

Below is an example of a heat map for Hudson, FL, using Listing Price as a criterion:

2. Streamline Your Search

Although the heat map narrows down the areas you need to look into, it still leaves you with several choices. You can filter your investment property search further by specifying your preferences based on the following parameters:

• Cash on Cash Return
• Cap Rate
• Budget Range
• Number of Bedrooms and Bathrooms
• Year Built
• Traditional or Airbnb Rental Income
• Property Type
• Neighborhood
• Status (for sale, foreclosure, pending, or sold)

It will be easier to select your investment property when you have reduced your choices.

3. Determine Potential Airbnb Income

The next step is to click on the property that you favor. You will be redirected to its listing page with all the basic information about the property, including the listing price, price per square footage, amenities, and description.

You will also get a comprehensive investment property analysis using our Airbnb calculator. Using data collected directly from the Airbnb platform, you will have a peek at the potential income of your selected property vis-à-vis comparable Airbnb homes in the same neighborhood.

The analysis enables you to make an informed purchase decision as it provides refined estimates of the following metrics:

• Airbnb Rental Income
• Expenses
• Airbnb Cash Flow
• Airbnb Cash on Cash Return
• Airbnb Cap Rate
• 10-Year Investment Payback

You can tweak the rental income, the Airbnb occupancy rate, and the rental expenses if you want to see how changes in these metrics will impact your rate of return. The numbers you derive will help you determine the viability of the rental property. If you think the property is worth investing in, the analysis will also help you decide how to make the property more profitable – increase the Airbnb daily rate, reduce the expense, or do both.

To get access to our real estate investment tools, sign up for Mashvisor today.

Conclusion

Based on January 2022 data, Hudson is a moderate Airbnb market. However, with the shift in lifestyle brought about by the Covid-19 pandemic, Hudson may emerge to be a diamond in the rough.

Hudson can easily attract more tourists with its tourist attractions, low cost of living, low crime rate, and pleasant weather for most of the year. The high cost of rentals and the shortage supply in more popular and bigger cities in Florida may drive tourists to Hudson.

Should you invest in Airbnb Hudson FL? If you are happy to start with modest returns and moderate risks, then yes, investing in Hudson, FL, is worth considering.

Lessen your risk by finding the best Airbnb Hudson FL property using Mashvisor. Our heat map feature will lead you to the hottest neighborhoods in Hudson based on your investment goal, while our Property Finder will narrow down your choices based on your preferences. Finally, the Mashvisor Airbnb calculator will help you determine potential returns on your selected property and allow you to alter specific metrics to guide you in planning your short term rental strategy.

To get access to all these and more real estate investment tools, sign up for Mashvisor now.

If you are still unsure how Mashvisor can make your search for a profitable investment easier, schedule a demo with our team.