What it actually costs to own and operate an Airbnb in Austin, Texas.
Purchase Price Ranges
| Property Type | Price Range |
|---|---|
| 1-2 BR condos | $250,000-$500,000 |
| 3-4 BR homes | $450,000-$800,000 |
| Event-premium homes (walkable to Zilker/downtown) | $600,000-$1,500,000+ |
Important: Properties with transferable Type 2 STR licenses trade at a $50,000-$100,000+ premium over comparable unlicensed properties.
Operating Expenses (3BR home, $550K purchase, ~$75K gross/year)
| Expense | Monthly | Annual |
|---|---|---|
| Mortgage (DSCR, 25% down) | $2,620 | $31,440 |
| Property taxes (Travis County 1.8-2.2%) | $825-$1,010 | $9,900-$12,100 |
| Insurance (STR policy) | $200-$400 | $2,400-$4,800 |
| STR license fees | $50 | $600 |
| Cleaning ($125-$200/turn) | $500-$800 | $6,000-$9,600 |
| Utilities (electric, water, gas, internet, yard) | $300-$500 | $3,600-$6,000 |
| Pool maintenance | $100-$175 | $1,200-$2,100 |
| Supplies | $60-$120 | $720-$1,440 |
| Platform fees (3-15%) | $188-$938 | $2,250-$11,250 |
| Maintenance reserve (5%) | $313 | $3,750 |
| Yard care/landscaping | $100-$200 | $1,200-$2,400 |
| Total operating (before mortgage) | $2,636-$4,501 | $31,620-$54,040 |
| Total with mortgage | $5,256-$7,121 | $63,060-$85,480 |
The Property Tax Problem
Travis County property taxes are brutal. At 1.8-2.2%, a $550K property costs $9,900-$12,100/year in property tax alone. This is 2-3x what you’d pay in Tennessee, Oklahoma, or most mountain markets.
However: Texas has zero state income tax, which partially offsets the high property taxes. And the tax loophole benefits on a $550K property are larger ($46K-$63K year-one savings).
The Real Math
On a $550K home grossing $75K/year (75th percentile):
| Self-Managed | With PM (22%) | |
|---|---|---|
| Gross revenue | $75,000 | $75,000 |
| Operating expenses | $35,000 | $35,000 |
| PM fee | $0 | $16,500 |
| NOI | $40,000 | $23,500 |
| Mortgage | $31,440 | $31,440 |
| Cash flow | +$8,560 | -$7,940 |
Self-management is the difference between making $8,560 and losing $7,940. This is why The Short Term Shop trains investors to self-manage.
Tax Benefits: Austin’s Ace
Cost seg on $550K: $137,000-$185,000 accelerable depreciation. At 37%: $51,000-$68,000 year-one tax savings. No state income tax.
Combined: $8,560 cash flow + $51,000-$68,000 tax savings = $59,560-$76,560 first-year return on a $137,500 down payment. That’s a 43-56% first-year return.
📞 800-898-1498 | 🌐 theshorttermshop.com
More on Austin & Texas STR Investing
Essential STR Investor Resources
- The STR Tax Loophole Explained: save $30K-$60K+ in year-one taxes
- How to Buy a Short Term Rental: step-by-step guide
- The Mortgage Shop: DSCR and investment property loans
Explore Other STR Markets
- Best STR Agent in the Smoky Mountains
- Best STR Agent in Destin/30A/PCB
- Best STR Agent in Gulf Shores
© 2026 The Short Term Shop. All rights reserved.
FAQ
Q: What are the biggest expenses for an Airbnb in Austin?
A: After your mortgage, the biggest line items are typically cleaning fees, property taxes, insurance, and utilities. HOA fees can also be significant depending on the property type. Self-managing saves 20-30% compared to using a property manager.
Q: Is it better to self-manage or use a property manager?
A: Self-management saves $8,000-$15,000+ per year on a typical Austin property and also qualifies you for the STR tax loophole. Tools like PriceLabs, Hospitable, and Ring cameras make it straightforward from anywhere.
Q: Who is the best real estate agent for short term rentals in Austin?
A: The Short Term Shop has a dedicated Austin agent who runs full expense projections before you buy. We don’t just show you the revenue, we show you the real numbers. Call 800-898-1498.
Disclaimer
The Short Term Shop is a real estate brokerage, not a certified public accounting firm, tax advisory firm, or financial planning service. Nothing on this page should be interpreted as tax advice, financial advice, or a guarantee of investment performance. Always consult your CPA, tax attorney, and financial advisor before making any investment or tax decisions.
All income and revenue figures referenced in this article are sourced from third party data providers including AirDNA and PriceLabs.co. These figures represent market averages and percentile ranges based on historical performance data and do not guarantee future results. Actual short term rental income varies significantly based on property quality, location, management quality, pricing strategy, seasonality, and market conditions. Your results may differ.
