Asheville, North Carolina is a mountain city known for its vibrant arts scene, craft breweries, outdoor adventure, and booming tourism industry. With consistent visitor traffic and a growing population, Asheville offers excellent opportunities to generate rental income — whether through short-term vacation rentals or long-term housing. This beginner’s guide explains how to profit from rental property investment in Asheville, including licensing rules, top strategies, and neighborhood insights.
Why Asheville is Great for Rental Income
- Popular Tourist Destination: Over 11 million people visit the Asheville area annually, creating steady demand for accommodations.
- Year-Round Appeal: Fall foliage, Biltmore Estate tourism, and access to the Blue Ridge Parkway keep bookings high in every season.
- Appreciating Real Estate Market: Asheville property values have steadily increased over the last decade, offering equity growth in addition to rental income.
- Thriving Culture & Quality of Life: A desirable place to live, attracting remote workers and retirees who contribute to strong long-term rental demand.
Top Strategies to Generate Rental Income in Asheville
1. Short-Term Vacation Rentals (Airbnb, Vrbo)
STRs are highly profitable in Asheville, particularly for well-located homes with mountain views or walkability to downtown. However, the city enforces strict STR zoning and permitting rules — STRs are only allowed in designated zones or with grandfathered permits.
2. Long-Term Residential Rentals
Areas outside city limits (or in Buncombe County) are ideal for long-term rentals to families, students, and remote professionals. Long-term leases provide steady cash flow with fewer legal hurdles.
3. Mid-Term Rentals (30+ Days)
Furnished rentals for travel nurses, corporate visitors, or digital nomads are in high demand. These typically don’t require STR permits and allow flexibility while avoiding the city’s STR zoning restrictions.
4. Owner-Occupied Homestays
In Asheville, homeowners may legally rent out rooms or attached units while living on-site. This is a great entry point for “house hackers” or those looking to offset a mortgage.
5. Cabin or Cottage Rentals
Properties on the outskirts of Asheville (Arden, Weaverville, Black Mountain) can be marketed as peaceful cabin retreats for STR or mid-term guests, often with fewer regulatory issues than city-limited properties.
Legal & Licensing Requirements in Asheville
- Short-Term Rental (STR) Permits: STRs (less than 30 days) are only allowed in certain zoning districts. STR permits are issued by the City of Asheville and may have occupancy and parking restrictions.
- Homestay Permits: Required for owner-occupied rentals of a room or accessory unit. Must be registered with the city and meet zoning and safety standards.
- Business License: Required for all rental income activities (STR, homestay, or long-term).
- Buncombe County Lodging Tax: STR operators must collect and remit:
- 6% Buncombe County Occupancy Tax
- North Carolina Sales Tax (6.75%)
- Zoning Compliance: STRs are generally prohibited in residential areas within city limits unless specifically allowed. Always confirm before listing.
Estimated Monthly Costs for Asheville Rental Properties
| Expense Type | Estimated Monthly Cost |
|---|---|
| Property Taxes | $200 – $700 |
| STR or Homestay Insurance | $60 – $150 |
| Maintenance & Repairs | $100 – $250 |
| Management (if outsourced) | 15% – 30% of rental income |
| STR Licensing & Taxes | $50 – $200/month (including tax filings) |
Best Neighborhoods for Rental Income in Asheville
- Montford: Historic and walkable — great for homestays and permitted STRs.
- Downtown Asheville: High-demand but limited STR zones — excellent for mid- to high-end permitted units.
- South Asheville: Family-friendly area with long-term rental potential.
- West Asheville: Artsy, hip, and increasingly popular with young professionals and mid-term renters.
- Weaverville / Arden / Black Mountain: Suburban and rural areas ideal for cabins, cottages, and STRs outside city restrictions.
Tax Benefits for Asheville Landlords
While North Carolina taxes rental income, landlords may deduct many property-related expenses, including:
- Mortgage interest and property taxes
- Home depreciation and furnishings
- Utilities, internet, and cleaning services
- Repairs, maintenance, and insurance
- Management fees and legal costs
- STR occupancy and sales taxes paid
STR owners must register for NC Sales & Use Tax and Buncombe County Occupancy Tax collection, then file monthly or quarterly returns.
Tips to Maximize Rental Income in Asheville
- Always Check Zoning Before You Buy: STR-friendly areas are limited. Consider homes outside city limits for fewer restrictions.
- Furnish Thoughtfully: Travelers in Asheville value cozy, modern, and artsy aesthetics that reflect local culture.
- Capitalize on Seasonal Demand: Raise prices during leaf-peeping season, Biltmore holidays, and summer festivals.
- Consider a Homestay License: If you plan to live in the home, this is the most flexible and legal way to rent part of your space.
Conclusion
Asheville is a rewarding place to invest in real estate, offering strong rental income potential for short-term, mid-term, and long-term strategies. With strict but navigable regulations, the key to success lies in choosing the right neighborhood, understanding licensing laws, and providing a unique guest experience that matches Asheville’s creative spirit and mountain charm.
Need help with STR permits, tax filing, or rental compliance in North Carolina?
Contact PEAK Business Consultancy Services — your expert partner in vacation rental licensing, business registration, and income planning in Asheville, NC.
