Exploring the Airbnb Investment Potential in Hollywood, Florida

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Nestled comfortably between the vibrant cities of Miami and Fort Lauderdale, Hollywood, Florida, emerges as a hidden gem for Airbnb investments. This seaside city marries the tranquility of beachfront living with the convenience of urban life, making it an increasingly popular choice for tourists and investors alike. This comprehensive article explores the Airbnb Investment Potential in Hollywood, Florida, from its strategic location and diverse culture to its growing real estate market and abundant entertainment options.

Robust Financial Indicators for Airbnb Hosts

Average Daily Rate (ADR): $304.7
Maximum Daily Rate: $359 (in February)
Occupancy Rate: 60%
Maximum Occupancy Rate: 77% (in March)
Maximum Monthly Revenue: $6,700 (in March)
Number of Active Rentals: 5,827
Average Annual Revenue: $66,500
Revenue Per Available Room (RevPAR): $185.8
Weekend RevPAR: $305
Best Month for Hosting: February
Submarket Score: 52
Population of Hollywood, Florida: 150,989
Average Home Value in Hollywood: $452,509 (up 6.2% over the past year)

Hollywood’s Airbnb market continues to exhibit strong financial performance. The Average Daily Rate (ADR) in Hollywood is $304.7, with a peak reaching $359 in February. This competitive pricing model is highly advantageous for Airbnb hosts in the area. The city’s occupancy rate averages around 60%, and it reaches its peak at 77% in March, underscoring the high demand for short-term rentals in Hollywood. The potential annual revenue for an Airbnb host in the city is impressive, standing at about $66.5K. The Revenue Per Available Room (RevPAR) averages at $185.8, with a notable increase to $305 during weekends.

Real Estate Market: Growth and Opportunities

The real estate market in Hollywood has been consistently growing. The average home value in Hollywood is now approximately $452,509, reflecting a 6.2% increase over the past year. This upward trend, along with its relative affordability compared to neighboring cities, makes Hollywood an increasingly attractive location for Airbnb investors.

Tourism and Demand: A Steady Influx

Hollywood’s charm, with its scenic beaches, cultural diversity, and proximity to major Florida attractions, continues to draw tourists. The city has a robust supply of Airbnb accommodations, with 5,827 active rentals. This demonstrates a healthy balance of supply to meet the strong demand. February remains the most profitable month for Airbnb hosts, largely due to the influx of tourists seeking warmer climates during winter.

Population Growth and Submarket Score

The population of Hollywood, Florida, has reached approximately 150,989 in 2023, indicating its rising popularity as a residential and tourist destination. The Submarket Score of 52 further highlights the favorable conditions for Airbnb investments in the city, supporting the notion that Hollywood is a thriving market for short-term rental ventures.

Strategic Location and Transport Connectivity

Hollywood, Florida’s advantageous location, sandwiched between the bustling cities of Miami and Fort Lauderdale, provides an optimal balance of tranquility and urban excitement. This strategic positioning is a key factor in its appeal as an Airbnb destination.

Proximity to Major Cities: Hollywood’s proximity to Miami and Fort Lauderdale expands the range of activities and attractions available to visitors. From the vibrant nightlife and cultural richness of Miami to the upscale beaches and dining in Fort Lauderdale, guests have access to a diverse array of experiences within a short drive.

Access to Major Highways: Hollywood is conveniently located near several major highways, including Interstate 95 and Florida’s Turnpike. This easy highway access facilitates smooth travel for visitors who wish to explore the broader South Florida region, including the famous Florida Keys and the Everglades National Park.

Public Transportation Options: Hollywood boasts a well-developed public transportation system, including bus routes and the Tri-Rail train service. The Tri-Rail offers an efficient and cost-effective way to traverse between Miami-Dade, Broward, and Palm Beach counties, making it an excellent option for tourists who prefer not to drive.

Air Travel Accessibility: The city’s proximity to two international airports—Fort Lauderdale-Hollywood International Airport (FLL) and Miami International Airport (MIA) – is a significant advantage. These airports offer numerous domestic and international flights, making Hollywood easily accessible for travelers from all over the world. This accessibility is especially beneficial for international tourists and business travelers looking for convenient short-term rental options.

Cruise Port Access: Hollywood is also close to Port Everglades, one of the busiest cruise ports in the world. This proximity makes it an attractive staying point for tourists embarking or disembarking from cruises, offering Airbnb hosts a unique market segment.

Entertainment and Leisure in Hollywood

Hollywood, Florida, is not just a gateway to nearby metropolitan areas but a destination in its own right, brimming with entertainment and leisure activities that cater to a wide array of interests.

Hollywood Beach Broadwalk: A standout feature of Hollywood, the Broadwalk stretches nearly 2.5 miles along the Atlantic Ocean. This award-winning promenade is a haven for joggers, cyclists, and those who enjoy strolls. Lined with quaint shops, cozy cafes, and oceanfront restaurants, it offers a picturesque and lively atmosphere that is quintessentially Floridian.

Beachfront Activities: Hollywood Beach is known for its pristine, family-friendly shores. Visitors can engage in various water sports, including jet-skiing, paddleboarding, and snorkeling. The beach’s clean, turquoise waters and soft sands make it an ideal spot for sunbathing and beach volleyball.

Arts and Culture: Hollywood is home to the Art and Culture Center/Hollywood, which hosts contemporary gallery exhibitions, live stage performances, and educational programming. The center is a focal point for the arts in South Florida, showcasing local and national artists. The ArtsPark at Young Circle provides a hub for local arts and culture, hosting frequent events and festivals that attract visitors.

Diverse Culinary Scene: Hollywood’s dining scene is as diverse as its population. From upscale seafood restaurants to casual beachside grills, the city offers a range of culinary experiences. Ethnic cuisines, such as Cuban, Italian, and Caribbean, are well-represented, providing a taste of the cultural melting pot that is South Florida.

Vibrant Nightlife: After sunset, Hollywood comes alive with a variety of nightlife options. The downtown area, especially around Young Circle, features lively bars, clubs, and lounges that offer everything from live music and DJ sets to craft cocktails and local brews.

Festivals and Events: Hollywood hosts numerous festivals and events throughout the year, including the Hollywood Beach Latin Festival, the Hollywood ArtWalk, and various food and music festivals. These events draw crowds for their vibrant displays of culture and community spirit.

Outdoor and Recreational Parks: For those who enjoy outdoor activities, Hollywood offers numerous parks and nature preserves. Topeekeegee Yugnee Park, commonly known as T.Y. Park, is popular for its walking trails, picnic areas, and a large lake for fishing and boating. Hollywood North Beach Park is another favorite for its beautiful beach views and native wildlife.

Golfing and Sports: The city boasts several beautifully maintained golf courses, like the Hollywood Beach Golf Club, offering challenging rounds for golf enthusiasts. Additionally, there are numerous tennis courts and sports fields for public use.

Navigating Hollywood’s Short-Term Rental Regulations

In Hollywood, Florida, short-term rentals are permissible, yet they are governed by a comprehensive set of regulations to ensure community harmony and quality standards. These regulations cover a range of aspects from occupancy limits to licensing and taxes, and are essential for hosts to understand for compliant operation.

City Code of Ordinances and Occupancy Regulations

According to Hollywood’s city code, short-term rentals are defined as dwellings for not more than one family, classified as transient public lodging establishments but not timeshare projects. The specific occupancy requirements include:

A minimum of 150 square feet for the first occupant, and at least 100 square feet for each additional occupant.
Bedrooms must provide at least 70 square feet for one occupant, and 50 square feet per person if shared by more. The maximum is two occupants per bedroom.
The day-time occupancy limit is 1.5 times the maximum overnight capacity, excluding up to four children under four years old.

Licensing and Business Requirements

For legal operation, hosts in Hollywood must obtain:

Additional documentation is also required, including:

A license as a Transient Public Lodging Establishment from the Florida Department of Business and Professional Regulation.
A certificate of registration with the Florida Department of Revenue.
An account with the Broward County Tax Collector for Tourist Development Tax.
A Local Business Tax Receipt from both Broward County and the City of Hollywood.

Explore VACATION RENTAL – REQUIREMENT DOCUMENTATION.

Property Type-Specific Regulations

Different rules apply to various property types:

Hotel and Condo-Hotel Rooms: Require a Certificate of Use and Business Tax Receipt; however, they do not need a Vacation Rental License. Only hotel operators can manage reservations.
Condo Units: Do not require a Certificate of Use but need a Business Tax Receipt and a Vacation Rental License if rented more than three times a year for less than 30 days. Management can be by the owner, an agent, or a company.
Single-Family Homes: Similar to condo units in terms of requirements.
Multi-Unit Properties (Duplex, Triplex, etc.): Require both a Certificate of Use and Business Tax Receipt, along with a Vacation Rental License under the same conditions.

Building and Housing Standards

The city enforces standards for building construction, design, and maintenance, focusing on habitability, health, and safety. Hosts should refer to Hollywood’s Residential Inspection Checklist and § 119.30 of the Vacation Rental License Regulations for detailed requirements.

Tax Compliance

Hosts must register for the Tourist Development Tax with Broward County and obtain a Sales Tax Number from the Florida Department of Revenue.

Noise Ordinance

Hollywood strictly enforces noise regulations, particularly between 10:00 p.m. and 7:00 a.m., to maintain community peace.

Understanding and adhering to these regulations is vital for hosts to successfully operate short-term rentals in Hollywood, ensuring both legal compliance and a positive experience for guests and the community.

Conclusion: Airbnb Investment Potential in Hollywood, Florida

Hollywood, Florida, emerges as a premier destination for Airbnb investments, blending the tranquility of beachfront living with urban convenience. Positioned strategically between Miami and Fort Lauderdale, it offers investors robust financial returns, evidenced by an impressive average daily rate and high occupancy rates, especially during peak seasons. The real estate market shows promising growth, complemented by a steady influx of tourists attracted to the city’s scenic beaches, diverse culture, and numerous attractions. Enhanced by excellent connectivity through major highways, public transportation, and proximity to international airports and a major cruise port, Hollywood is not just a gateway to South Florida but a vibrant destination in its own right. Its lively array of entertainment, dining, and cultural events, along with well-structured short-term rental regulations, ensure a harmonious balance between the needs of tourists, residents, and investors, solidifying Hollywood’s position as a lucrative and sustainable choice for Airbnb ventures.