Airbnb City Guide: The Best Places To Invest in Sioux Falls, South Dakota

Airbnb Rules and Regulations in Sioux Falls, South Dakota

As of 2024, Sioux Falls has implemented a set of regulations governing short-term rentals to ensure a fair and safe experience for both hosts and guests. Hosts are required to obtain a permit from the city, which involves a simple application process and a nominal fee. Additionally, all Airbnb properties must adhere to the city's zoning laws, with specific guidelines for different residential areas. Safety is a top priority, and hosts must ensure that their properties are equipped with functioning smoke detectors, carbon monoxide detectors, and fire extinguishers.

The city also mandates that hosts provide guests with a list of emergency contacts and local resources. To maintain the tranquility of residential neighborhoods, the city has set occupancy limits based on the number of bedrooms in each property. Hosts are responsible for collecting and remitting the appropriate taxes, including the city's lodging and sales taxes. By complying with these regulations, Airbnb hosts in Sioux Falls can confidently operate their short-term rentals, knowing that they are contributing to a thriving and well-regulated tourism industry in the city.

Sioux Falls Airbnb Market Data:

• Average Revenue – $50K per year
• Average Daily Rate – $253.7 per night
• Average Occupancy Rate – 54%
• Average RevPAR – $138
• Average Home Prices – $321,648

1. Top Place to Invest in Sioux Falls, South Dakota - Falls Park

Falls Park, a picturesque neighborhood nestled around the city's namesake waterfall, has emerged as a top destination for Airbnb and short-term rental investments in Sioux Falls. With its stunning natural beauty, convenient location, and array of attractions, Falls Park offers a unique and desirable setting for visitors seeking an unforgettable experience in the heart of the city.

Falls Park Airbnb Market Data:

• Average Revenue – $57.5K per year
• Average Daily Rate – $308.9 per night
• Average Occupancy Rate – 51%
• Average RevPAR – $159

Convenience - 8/10

Falls Park's central location is one of its greatest assets. Situated just minutes from downtown Sioux Falls, this neighborhood provides easy access to the city's main business district, shopping centers, and dining options. The nearby I-229 and I-90 highways connect Falls Park to the rest of the city and beyond, making it a convenient base for exploring the region. The area also boasts ample parking and well-maintained sidewalks, ensuring that visitors can easily navigate the neighborhood.

Tourist Attractions - 9/10

Falls Park itself is the neighborhood's crown jewel and a major draw for visitors. The park features a stunning 100-foot waterfall, surrounded by lush greenery and walking trails. The nearby Falls Overlook Café offers breathtaking views of the falls and a menu of locally sourced cuisine. The park also features a visitor center where guests can learn about the history of the falls and the city. Other nearby attractions include the Sculpture Walk, an outdoor art exhibit featuring works by local and national artists, and the Levitt Shell, an outdoor amphitheater hosting free summer concerts.

Things to Do - 8/10

Falls Park offers a wide range of activities for visitors of all ages. The park's walking trails provide a perfect opportunity for a leisurely stroll or a vigorous hike, while the open green spaces are ideal for picnics and outdoor games. The park also features a farmers market during the summer months, showcasing local produce and crafts. For those seeking a more adventurous and fitness-focused experience, the nearby Outdoor Campus offers kayaking, fishing, and other outdoor activities classes. The neighborhood also boasts a variety of shops and restaurants, ranging from casual cafes to upscale dining establishments.

Average Home Prices - 7/10

According to Zillow data for 2024, the average home value in Falls Park is approximately $350,000. While this may seem high compared to some areas of Sioux Falls, it's important to note that Falls Park has experienced a steady appreciation rate of 4% over the past year. This trend indicates a strong and growing real estate market, which is crucial for investors seeking to purchase a home to transform into an Airbnb. However, investors should be aware that the neighborhood's popularity and central location may result in higher property taxes and maintenance costs.

Proximity to Work-Related Travel - 7/10

Falls Park's proximity to downtown Sioux Falls makes it convenient for work-related travel. The neighborhood is just a short drive from the city's main business district, which is home to numerous corporate offices, banks, and government buildings. The nearby Sanford USD Medical Center and Avera McKennan Hospital also make Falls Park an attractive option for medical professionals and patients' families. However, the neighborhood's distance from the Sioux Falls Regional Airport may be a drawback for some business travelers.

X-Factor - 9/10

What sets Falls Park apart is its unparalleled combination of natural beauty, history, and urban amenities. The neighborhood's stunning waterfall and park system create a serene and inviting atmosphere that is highly desirable among visitors seeking a unique and memorable experience. The area's rich history, showcased through its visitor center and nearby museums, adds depth and character to the neighborhood. At the same time, Falls Park's proximity to downtown Sioux Falls ensures that visitors have access to all the comforts and conveniences of urban living. For Airbnb investors, Falls Park presents an opportunity to cater to a wide range of guests, from nature enthusiasts and history buffs to business travelers and families seeking a one-of-a-kind experience in the heart of Sioux Falls.

2. Top Place to Invest in Sioux Falls, South Dakota - Central Sioux Falls

Central Sioux Falls, the heart of South Dakota's largest city, has emerged as a prime location for starting short-term rental investments. With its rich history, vibrant downtown scene, and proximity to top attractions, Central Sioux Falls offers a unique and attractive opportunity for savvy investors looking to capitalize on the growing demand for vacation rentals in this dynamic area.

Central Sioux Falls Airbnb Market Data:

• Average Revenue – $43.8K per year
• Average Daily Rate – $214.3 per night
• Average Occupancy Rate – 56%
• Average RevPAR – $124.4

Convenience - 9/10

One of Central Sioux Falls' greatest strengths is its unbeatable convenience. The neighborhood's central location provides easy access to major highways, connecting visitors to the rest of the city and beyond. The area's walkability is a major draw, with numerous shops, restaurants, and services within easy reach. The nearby Falls Park, a stunning natural attraction, is just a short stroll away.

Tourist Attractions - 8/10

Central Sioux Falls boasts a wealth of tourist attractions that keep visitors coming back. The nearby Falls Park, with its breathtaking waterfalls and scenic trails, is a must-see for any visitor. The Washington Pavilion, a cultural hub featuring museums, theaters, and a science center, is just a short walk away. The Downtown Sculpture Walk, an outdoor art exhibit showcasing works by local and national artists, adds to the area's charm.

Things to Do - 8/10

From outdoor adventures to cultural experiences, Central Sioux Falls offers visitors a wide range of activities. The nearby Falls Park provides opportunities for hiking, picnicking, and photography. The Downtown Sioux Falls area is home to numerous local festivals and events throughout the year, including live music performances and farmers markets. For those seeking indoor entertainment, the Washington Pavilion and the nearby Orpheum Theater offer a variety of shows and exhibits.

Average Home Prices - 7/10

According to Zillow data for 2024, the average home value in Central Sioux Falls is approximately $439,900. While this may seem high compared to some areas of the city, it's important to note that Central Sioux Falls has experienced a steady appreciation rate of 3.9% over the past year. This trend indicates a strong and stable real estate market, which is crucial for Airbnb investors seeking long-term growth and returns.

Proximity to Work-Related Travel - 8/10

Central Sioux Falls' location makes it a convenient choice for work-related travel. The neighborhood is just minutes away from major employers, including hospitals, banks, and government offices. The nearby Sioux Falls Convention Center attracts a steady stream of business travelers and conference attendees, making it a prime location for corporate rentals. Additionally, the Sioux Falls Regional Airport is just a short drive away, making it easy for visitors to arrive and depart.

X-Factor - 9/10

Central Sioux Falls's perfect blend of history, culture, and modern amenities sets it apart. The neighborhood's rich past is evident in its stunning architecture, including the historic Cathedral of Saint Joseph and the Old Courthouse Museum. At the same time, the area's thriving downtown scene offers a variety of dining, shopping, and entertainment options. This unique combination of old-world charm and contemporary vibrancy creates an irresistible atmosphere that keeps visitors coming back. For Airbnb investors, Central Sioux Falls presents an opportunity to offer guests a one-of-a-kind experience in the heart of South Dakota's most vibrant city.

3. Top Place to Invest in Sioux Falls, South Dakota - Silver Valley Addition

Silver Valley Addition, a thriving neighborhood on the west side of Sioux Falls, has emerged as a top choice for Airbnb and short-term rental investments. This budding community offers a perfect blend of residential charm, convenient amenities, and proximity to the city's attractions, making it an attractive option for investors seeking to capitalize on the growing demand for vacation rentals in a peaceful yet well-connected area.

Silver Valley Addition Airbnb Market Data:

• Average Revenue – $57.9K per year
• Average Daily Rate – $304.9 per night
• Average Occupancy Rate – 52%
• Average RevPAR – $159.8

Convenience - 8/10

One of Silver Valley Addition's greatest strengths is its prime location. Nestled in the heart of Sioux Falls' west side, this neighborhood provides easy access to major highways, connecting visitors to the rest of the city and beyond. The area's walkability is a major draw, with parks, a library, and an elementary school within walking distance. The nearby Empire Mall and various shopping centers ensure that residents and visitors have everything they need just a short drive away.

Tourist Attractions - 6/10

While Silver Valley Addition itself is primarily residential, its proximity to popular tourist destinations is a significant advantage. The nearby Great Plains Zoo, a popular attraction featuring hundreds of animals, is just a short drive away. The Washington Pavilion, a cultural hub offering museums, theaters, and a science center, is easily accessible from the neighborhood. For outdoor enthusiasts, the Sioux Falls Bike Trails system provides miles of scenic paths to explore.

Things to Do - 7/10

Silver Valley Addition offers a range of activities for residents and visitors alike. The neighborhood's parks provide ample opportunities for outdoor recreation, including picnics, sports, and leisurely walks. The nearby Sioux Falls Bike Trails system is perfect for cycling enthusiasts. For those seeking indoor entertainment, the Empire Mall and surrounding shopping centers offer a variety of retail and dining options. The neighborhood's proximity to downtown Sioux Falls also provides easy access to a wide array of cultural events and festivals throughout the year.

Average Home Prices - 7/10

According to Zillow data for 2024, the average home value in Silver Valley Addition is approximately $350,000. While this may seem high compared to some areas of Sioux Falls, it's important to note that the neighborhood has experienced a steady appreciation rate of 4% over the past year. This trend indicates a strong and growing real estate market, which is crucial for Airbnb investors seeking long-term growth and returns. However, investors should be aware that the area's popularity and newer construction may result in higher property taxes and maintenance costs, which is why you should use STR calculators to ensure that you can make a wise investment decision.

Proximity to Work-Related Travel - 7/10

Silver Valley Addition's location makes it a convenient choice for work-related travel The neighborhood is just a short drive from major employers, including hospitals, banks, and corporate offices. The nearby I-29 and I-229 highways provide easy access to the rest of the city and the Sioux Falls Regional Airport. While the neighborhood is not within walking distance of the city's main business district, its proximity to major thoroughfares ensures that business travelers can easily reach their destinations.

X-Factor - 8/10

Silver Valley Addition's unique combination of residential tranquility and urban convenience sets it apart. The neighborhood's well-maintained homes, spacious lots, and quiet streets create a peaceful and inviting atmosphere that is highly desirable among visitors seeking a relaxing stay. At the same time, the area's proximity to shopping, dining, and entertainment options ensures that guests have easy access to all the amenities they need. This perfect balance of serenity and convenience makes Silver Valley Addition a hidden gem for Airbnb investors looking to offer their guests a memorable and stress-free experience.

4. Top Place to Invest in Sioux Falls, South Dakota - Ellis

Ellis, a charming neighborhood in the heart of Sioux Falls, has emerged as a promising destination for those aspiring to start an Airbnb rental. With its rich history, convenient location, and proximity to top attractions, Ellis offers a unique and desirable setting for visitors seeking an authentic experience in this vibrant city.

Ellis Airbnb Market Data:

• Average Revenue – $36.8K per year
• Average Daily Rate – $210.2 per night
• Average Occupancy Rate – 48%
• Average RevPAR – $107.6

Convenience - 7/10

Ellis' location provides a balance of residential tranquility and urban accessibility. Situated just a few miles from downtown Sioux Falls, the neighborhood offers easy access to the city's main attractions, shopping districts, and dining options. The nearby I-229 highway connects Ellis to the rest of the city, making it a convenient base for exploring the area. However, the neighborhood's distance from major thoroughfares may be a slight drawback for some visitors.

Tourist Attractions - 6/10

While Ellis itself is primarily a residential area, its proximity to popular tourist destinations is a significant advantage. The nearby Falls Park, a stunning natural attraction featuring a 100-foot waterfall, is just a short drive away. The Sioux Falls Bike Trails system, which offers miles of scenic paths for cycling and hiking, is easily accessible from the neighborhood. For those interested in history, the Pettigrew Home & Museum, a beautifully preserved Victorian mansion, is located just a few blocks away.

Things to Do - 6/10

Ellis offers a range of activities for residents and visitors alike. The neighborhood's tree-lined streets and well-maintained sidewalks provide a perfect setting for leisurely walks and bike rides. The nearby Sherman Park features a playground, picnic areas, and a public swimming pool, making it a popular spot for families during the summer months. For those seeking a taste of local culture, the 8th & Railroad Center, a historic building housing art galleries, boutiques, and a farmers market, is just a short drive away.

Average Home Prices - 8/10

According to Zillow data for 2024, the average home value in Ellis is approximately $250,000. This relatively affordable price point, combined with the neighborhood's stable appreciation rate of 3% over the past year, makes Ellis an attractive option for Airbnb investors seeking a balance of affordability and growth potential. The area's older homes and established infrastructure may also result in lower maintenance costs compared to newer developments.

Proximity to Work-Related Travel - 6/10

Ellis' location offers a moderate level of convenience for work-related travel. While the neighborhood is not in the immediate vicinity of major business districts or conference centers, it is within a reasonable driving distance. The nearby Avera McKennan Hospital and University Health Center, one of the largest employers in the city, is just a short drive away. However, the neighborhood's distance from the Sioux Falls Regional Airport may be a drawback for some business travelers.

X-Factor - 7/10

What sets Ellis apart is its strong sense of community and historic charm. The neighborhood's well-preserved homes make for great rentals, some dating back to the early 1900s, create a unique and inviting atmosphere that is highly desirable among visitors seeking an authentic experience. The area's friendly residents and active neighborhood association foster a welcoming environment that keeps guests coming back. For Airbnb investors, Ellis presents an opportunity to offer a taste of small-town hospitality within the heart of a thriving city.

5. Top Place to Invest in Sioux Falls, South Dakota - East Sioux Falls

East Sioux Falls, a thriving neighborhood on the eastern edge of South Dakota's largest city, has emerged as a prime location for Airbnb and short-term rental investments. With its blend of residential charm, convenient amenities, and proximity to the city's top attractions, East Sioux Falls offers a compelling opportunity for savvy investors looking to capitalize on the growing demand for vacation rentals in this dynamic area.

East Sioux Falls Airbnb Market Data:

• Average Revenue – $41.3K per year
• Average Daily Rate – $202.2 per night
• Average Occupancy Rate – 56%
• Average RevPAR – $115.2

Convenience - 8/10

One of East Sioux Falls' greatest strengths is its strategic location. Situated just off Interstate 229, this neighborhood provides easy access to major highways, connecting visitors to the rest of the city and beyond. The area's well-maintained streets and sidewalks make it easy to navigate, while nearby shopping centers and grocery stores ensure that guests have everything they need within reach.

Tourist Attractions - 7/10

While East Sioux Falls itself is primarily residential, its proximity to popular tourist destinations is a significant advantage. The famous Falls Park, with its stunning waterfalls and scenic trails, is just a short drive away. Visitors can also easily access other top attractions, such as the Washington Pavilion, the Butterfly House & Aquarium, and the Great Plains Zoo.

Things to Do - 7/10

East Sioux Falls offers a range of activities for residents and visitors alike. The neighborhood's parks and green spaces provide ample opportunities for outdoor recreation, including hiking, biking, and picnicking. The nearby Big Sioux River Recreation Trail and Greenway connect East Sioux Falls to the rest of the city, offering miles of scenic paths to explore. For those seeking indoor entertainment, the area's proximity to downtown Sioux Falls opens up a world of dining, shopping, and cultural experiences.

Average Home Prices - 8/10

According to Redfin data for 2024, the median home price in East Sioux Falls is $203,450, up 9.7% compared to the previous year. This relatively affordable price point, combined with the neighborhood's steady appreciation rate, makes East Sioux Falls an attractive option for Airbnb investors seeking a balance of affordability and growth potential. The area's diverse housing stock, ranging from cozy bungalows to spacious family homes, caters to a wide range of guest preferences.

Proximity to Work-Related Travel - 7/10

East Sioux Falls' location offers moderate convenience for work-related travel. While the neighborhood is not in the immediate vicinity of major business districts, it is within a reasonable driving distance of the city's main employment centers. The nearby Avera Heart Hospital and Sanford USD Medical Center are easily accessible, making East Sioux Falls a convenient choice for medical professionals and patients' families.

X-Factor - 8/10

What sets East Sioux Falls apart is its strong sense of community and small-town charm, all within the context of a growing city. The neighborhood's friendly residents, well-maintained homes, and quiet streets create a welcoming atmosphere that keeps guests coming back. At the same time, East Sioux Falls' proximity to the city's top attractions and amenities ensures that visitors have easy access to all the excitement and convenience of urban living. For Airbnb investors, this unique combination of tranquility and accessibility makes East Sioux Falls a hidden gem in the heart of South Dakota's largest city.