Why Hollywood, Florida, is a Prime Location for Airbnb Investment

Hollywood, Florida, nestled between the bustling urban centers of Miami and Fort Lauderdale, offers a unique blend of serene beachfront, cultural diversity, and urban convenience. This coastal city is emerging as a lucrative arena for Airbnb investments, thanks to its vibrant tourist scene, encouraging financial metrics, and a real estate market on the rise. This article meticulously delves into the reasons why Hollywood, Florida, is a prime location for Airbnb investment, touching on its financial appeal, real estate dynamics, strategic location, transportation networks, and a rich tapestry of entertainment options.

Hollywood’s Impressive Financial Metrics

Average Daily Rate (ADR): $291
Maximum Daily Rate: $356 in March
Occupancy Rate: Average 58%
Maximum Occupancy Rate: 73% in March
Maximum Monthly Revenue: $6,700 in March
Average Monthly Revenue: $4,237
Average Annual Revenue: $50.8K
Revenue Per Available Room (RevPAR): $166
Weekend RevPAR: $302
Best Month for Airbnb: March

The financial metrics associated with Airbnb investments in Hollywood, Florida, are compelling. The Average Daily Rate (ADR) stands at $291, with a peak in March when the Max Daily Rate reaches $356. These figures highlight a profitable pricing structure that Airbnb hosts can exploit. The Occupancy Rate averages 58%, peaking impressively at 73% in March, indicative of the city’s attraction to visitors, particularly those escaping colder climates. This peak occupancy rate in March corresponds to a Max Monthly Revenue of $6,700. Over the year, an Airbnb host can expect an Average Annual Revenue of $50.8K. The Revenue Per Available Room (RevPAR) underscores this, standing at $166 and escalating over weekends to a significant $302.

Hollywood’s Flourishing Real Estate Market

The real estate market in Hollywood has been on an upward trajectory, fostering a conducive environment for Airbnb investments. The average home value in Hollywood is now $460,254, noting a substantial appreciation of 7.0% over the past year. Despite this rise, the real estate market remains relatively affordable compared to neighboring cities like Miami, where home values average $571,215, thus lowering the entry barrier for potential Airbnb investors.

Vibrant Tourism and Steady Demand

The statistics showcase a flourishing Airbnb market in Hollywood, Florida, buoyed by a consistent influx of tourists attracted to the area’s stunning beaches, rich cultural diversity, and proximity to major attractions throughout Florida. Currently, Hollywood boasts 5,312 active Airbnb listings, demonstrating a strong supply ready to meet the ever-increasing demand for diverse lodging options. The city’s appeal is boosted by its strategic location, which serves as a gateway to the broader attractions of South Florida, including the Everglades, Miami’s dynamic cultural scene, and the family-friendly destinations in Fort Lauderdale.

Hollywood Submarket Score and Population Growth

The Submarket Score for Airbnb investments in Hollywood is 58, highlighting favorable market conditions. Furthermore, the population of Hollywood remains stable at 150,989, reflecting its increasing appeal as a residential and tourist destination. This steady population growth, alongside a flourishing tourism sector, signals a sustained demand for short-term rental accommodations.

Hollywood’s Strategic Location and Transportation Networks

Hollywood’s strategic position nestled between Miami and Fort Lauderdale offers the perfect balance of tranquility and urban excitement. This ideal location not only draws visitors looking for a peaceful retreat close to vibrant city life but also serves as a magnet for Airbnb guests.

Transportation Accessibility

Major Highways: Hollywood is well-connected by major highways, including Interstate 95 (I-95) and Florida’s Turnpike. These highways provide direct routes to the bustling cities of Miami and Fort Lauderdale, as well as other scenic areas across Florida.

Public Transit Systems: The city is served by several public transit options. Broward County Transit (BCT) offers extensive bus routes throughout Hollywood and neighboring cities. Additionally, the Tri-Rail system provides a convenient north-south railway service linking Miami, Fort Lauderdale, and West Palm Beach, which is especially beneficial for commuters and tourists alike.

Circulator Service: Hollywood also offers a local circulator bus service, which facilitates easy and affordable travel around the city, enhancing the convenience for tourists exploring local attractions.

Proximity to Airports

Miami International Airport (MIA): Located approximately 20 miles south of Hollywood, MIA is one of the largest international airports in the U.S., offering numerous direct flights domestically and internationally. This proximity makes Hollywood an easily accessible destination for international tourists.

Fort Lauderdale-Hollywood International Airport (FLL): Just about 5 miles north of downtown Hollywood, FLL provides another convenient travel hub with a range of domestic and international flights. Its closeness allows for quick transfers, making it an ideal option for visitors who prefer less travel time on arrival and departure.

The combination of Hollywood’s prime location, robust transportation networks, and access to two international airports significantly enhances its accessibility. This makes Hollywood not only a convenient and attractive destination for tourists but also a strategic and potentially lucrative location for Airbnb hosts, capitalizing on the city’s continuous flow of visitors.

Why Hollywood, Florida, is a Prime Location for Airbnb Investment

Entertainment and Recreational Richness of Hollywood

Pristine Beaches and Hollywood Beach Broadwalk

Hollywood, Florida, is renowned for its gorgeous, expansive beaches that stretch along the Atlantic coast, offering the perfect setting for relaxation and water activities. The Hollywood Beach Broadwalk, a 2.5-mile-long pedestrian promenade lined with cafes, shops, and boutiques, provides a scenic and lively venue for walking, jogging, and cycling. Its accessibility and vibrant atmosphere make it a favorite among both locals and tourists.

Parks and Nature Reserves

Hollywood is home to numerous parks and nature reserves, making it an ideal destination for outdoor enthusiasts. Notable spots include:

West Lake Park: A large preserve offering kayaking, bird-watching, and mangrove forests.

Anne Kolb Nature Center: A center for environmental education featuring trails, an aquarium, and observation towers with views over the wetlands.

ArtsPark at Young Circle: A cultural hotspot that hosts frequent arts and crafts fairs, food truck events, and free outdoor concerts.

Thriving Nightlife and Diverse Culinary Scene

The city boasts a thriving nightlife with a variety of bars, clubs, and live music venues that cater to diverse tastes. Hollywood’s culinary scene reflects its multicultural community, offering a wide range of dining options from upscale restaurants to local ethnic eateries. Highlights include fresh seafood spots along the boardwalk, traditional Cuban diners, and trendy bistros offering international cuisine.

Festivals and Community Events

Hollywood frequently hosts festivals and community events that celebrate its rich cultural tapestry. These include the Hollywood Salsa Fest, the Jazz in the Gardens Music Festival, and the Art and Culture Center/Hollywood’s annual gala. Such events offer residents and visitors a chance to experience local traditions, music, and the arts up close.

Proximity to Miami and Fort Lauderdale

Located just a short drive from both Miami and Fort Lauderdale, Hollywood offers additional entertainment and recreational options. Visitors can enjoy world-class shopping at destinations like the Aventura Mall and Sawgrass Mills, or explore cultural and nightlife venues ranging from the Miami Design District to the artsy streets of Fort Lauderdale’s Las Olas Boulevard. This proximity also allows easy access to international events such as Miami’s Art Basel and the Fort Lauderdale Boat Show.

By leveraging its strategic location and a rich array of local and nearby attractions, Hollywood, Florida, presents an engaging blend of tranquility, outdoor recreation, and vibrant urban life. This makes it not only a prime destination for tourists but also a continually appealing place for residents and potential investors.

Beyond the Beach: Unique Local Tips for Airbnb Guests in Hollywood, FL

Overview of Hollywood, FL, Short-Term Rental Regulations

In Hollywood, Florida, short-term rentals are permitted but regulated. The city defines vacation rentals as dwellings designed for not more than one family, serving as transient public lodging establishments, excluding timeshare projects. Here are some key regulatory points:

Maximum Occupancy:

Vacation rentals should have a minimum gross floor area of 150 square feet for the first occupant and 100 square feet for each additional occupant.
Sleeping rooms must have at least 70 square feet area, with a gross floor area of 50 square feet per occupant when shared.
The occupancy limit during the day is set at one and a half times the maximum overnight occupancy, with an exemption for up to four children under four years of age.

Business License Requirements:

Hosts must obtain a Vacation Rental License Certificate, Certificate of Use Application, and Business Tax Receipt.
Additional state and county documentation is required, including a transient public lodging establishment license, a registration certificate with the Florida Department of Revenue, and an account with the Broward County Tax Collector for Tourist Development Tax.

Specific Regulations for Different Property Types:

Hotel rooms and condo-hotel rooms require a Certificate of Use and Business Tax Receipt, but not a Vacation Rental License. Reservations can only be managed by a hotel operator.
Condo units, single-family homes, and multi-family units like duplexes, triplexes, and quadplexes require a Vacation Rental License if rented three or more times per year for less than 30 days each. Reservations and property management can be handled by the owner, a listing agent, or a management company.

Building and Housing Standards:

The city enforces standards for construction, design, and maintenance to ensure habitability, health, and safety. Some of these regulations may apply to your listing.

Tourist and Local Taxes:

Hosts must register for the Tourist Development Tax or “resort tax” with Broward County, and obtain a Sales Tax Number from the Florida Department of Revenue before applying for a Broward County Tourist Tax account.

Noise Ordinance:

Strict noise restrictions are enforced between 10:00 p.m. and 7:00 a.m. to maintain a peaceful living environment within the community.

For a more detailed understanding, it’s advisable to review the complete Vacation Rental License Application Checklist and § 119.30 of Hollywood, Florida – Vacation Rental License Regulations.

Comparison of Hollywood with Neighboring Markets

Affordability: Hollywood’s average home value is $460,254, which is lower than Fort Lauderdale’s $530,859 and Miami’s $571,215. This makes Hollywood potentially more accessible for new investors looking for more affordable entry points into the Airbnb market.

Daily Rates and Revenue: Fort Lauderdale commands the highest Average Daily Rate (ADR) at $318.8 and a maximum daily rate of $376 in March, compared to Hollywood’s ADR of $291 and a maximum of $356 in the same month. Despite this, Hollywood’s competitive rates offer a good balance between price and occupancy, aiming to maximize revenues without the premium pricing of its neighbors.

Occupancy Rates: Hollywood enjoys a slightly higher average occupancy rate of 58% with a peak at 73% in March, compared to Fort Lauderdale’s average of 57% and peak of 71% and Miami’s similar average of 57% but a lower peak at 69%. This higher occupancy rate in Hollywood, especially during peak times, could translate into more consistent earnings for Airbnb hosts.

Market Saturation: Miami, with 14,195 active rentals, shows significant market saturation, which could mean increased competition among Airbnb hosts. In contrast, Hollywood, with 5,312 active rentals, might offer more opportunities for new entrants due to less competition and more market gaps to fill.

Submarket Scores: While Fort Lauderdale boasts the highest submarket score of 76, indicating very favorable investment conditions, Hollywood’s score of 58 also suggests strong potential.

This comparative analysis illustrates that while all three cities possess unique strengths, Hollywood stands out for its combination of affordability, solid occupancy rates, and less competitive market, making it an appealing option for those looking to invest in the Airbnb market. This balance could provide a strategic advantage for investors aiming to maximize returns while managing investment risks effectively.

Future Outlook for Airbnb in Hollywood

The future potential of Airbnb investments in Hollywood, Florida, can be assessed by examining current trends and future forecasts in tourism and real estate. These insights help predict the viability and profitability of entering the Airbnb market in this region.

Tourism Trends and Forecasts

Continued Growth in Visitor Numbers: Tourism in Hollywood is expected to continue growing, driven by its appealing climate, beautiful beaches, and proximity to major cities like Miami and Fort Lauderdale. The city’s ability to attract tourists year-round, particularly during the winter months when tourists seek warmer climates, supports a steady demand for short-term rentals.

Enhancement of Tourist Attractions: Plans to enhance existing attractions and develop new ones, such as improved beach facilities, cultural festivals, and public events, are likely to boost tourist numbers further. Additionally, Hollywood’s strategic marketing initiatives aimed at international tourists will continue to enhance its profile as a prime vacation destination.

Real Estate Market Dynamics

Appreciation of Property Values: The real estate market in Hollywood has shown a robust appreciation, with home values increasing by 7.0% over the past year. This trend is expected to continue, influenced by the overall growth in the South Florida real estate market and ongoing residential developments.

Affordability Compared to Neighboring Cities: While Hollywood’s real estate remains more affordable compared to Miami and Fort Lauderdale, this may gradually change as the area becomes more desirable. However, this also suggests the potential for higher capital gains for those entering the market now.

Regulatory Environment

Impact of Regulations: The local government’s approach to regulating short-term rentals will significantly influence the market. While current regulations support the growth of Airbnb rentals, potential investors should stay alert to any changes that could impose stricter controls or additional costs.

Economic Indicators

Economic Stability and Growth: The economic environment in Hollywood and the broader Broward County area is stable and conducive to investment. Economic growth, low unemployment rates, and increasing consumer spending all bode well for continued demand for short-term accommodations.

Investment Considerations

Diversification and Risk Management: Investors should consider diversifying their offerings, catering to various tourist segments, including leisure travelers, business travelers, and event-goers. Offering flexible accommodations that can appeal to both short-term and medium-term stays could mitigate the risks associated with any seasonal fluctuations.

Long-term Viability

Sustainable Tourism Initiatives: Hollywood’s commitment to sustainable tourism practices and infrastructure improvements, such as better public transport and environmental conservation programs, will enhance its long-term appeal as a destination.

The outlook for Airbnb investments in Hollywood looks promising, with strong indicators of continued tourism growth and real estate appreciation. Prospective investors can capitalize on these trends by strategically positioning their properties to meet the diverse needs of visitors while remaining vigilant to changes in the regulatory landscape.

Conclusion

The assortment of factors delineated throughout this narrative underscores why Hollywood, Florida, is a prime location for Airbnb investment. Its unique geographical placement, coupled with a flourishing real estate market, attractive financial metrics, and a robust tourism sector, creates a conducive environment for Airbnb hosts. The city’s regulatory framework, albeit stringent, is designed to maintain a harmonious coexistence between short-term rentals, permanent residents, and the broader community, further cementing its position as a viable Airbnb investment destination. The blend of urban excitement and serene beachfront, enriched by a tapestry of cultural and recreational offerings, renders Hollywood not only a lucrative option for Airbnb hosts but also a delightful experience for visitors.

Explore the other best cities for Airbnb investment in the Miami Metro Area:

Why Hollywood, Florida, is a Prime Location for Airbnb Investment

Hollywood’s Impressive Financial Metrics

Hollywood’s Flourishing Real Estate Market

Vibrant Tourism and Steady Demand

Hollywood Submarket Score and Population Growth