How Much Do Short Term Rentals Make in Sedona, Arizona?
The median 3-bedroom short term rental in Sedona, Arizona generates approximately $61,600 in annual gross revenue. The revenue spread is substantial: top-10% 3-bedroom properties earn about $128,300 annually.
Larger properties can generate significantly more, with a median 4-bedroom earning about $84,800, a median 5-bedroom earning about $144,000, and a median 6+ bedroom property earning about $167,300.
Sedona's appeal is singular. Red rock formations, spiritual tourism, outdoor adventure, and a luxury-leaning traveler demographic combine to create a market where guests are willing to pay premium prices for the right property. The town draws roughly 3 million visitors annually despite having a permanent population of only about 10,000.
For investors, Sedona presents high revenue potential for well-positioned properties paired with limited inventory and local regulatory requirements. Sedona does not cap the number of short-term rentals, but every qualifying STR must follow city permitting requirements and Arizona tax rules.
How Much Do Short Term Rentals Make in Sedona?
Based on AirDNA data for Sedona short-term rentals, September 2025 through August 2026, here's what listings earn in annual gross revenue by bedroom count:
| Bedrooms | Average Revenue | Median Revenue | Top 10% |
|---|---|---|---|
| 1 Bedroom | $33,300 | $28,400 | $63,600 |
| 2 Bedroom | $48,100 | $42,700 | $88,800 |
| 3 Bedroom | $69,300 | $61,600 | $128,300 |
| 4 Bedroom | $97,300 | $84,800 | $185,500 |
| 5 Bedroom | $161,600 | $144,000 | $290,100 |
| 6+ Bedroom | $231,700 | $167,300 | —* |
Source: AirDNA, Sedona, September 2025 – August 2026. Top 10% figures are estimates and run somewhat high. *There aren't enough 6+ bedroom listings for a reliable top 10% figure.
The 4-bedroom segment shows a meaningful jump in median revenue, from about $61,600 for a 3-bedroom to about $84,800 for a 4-bedroom. This reflects Sedona's group travel demand: multi-generational families, friend groups, and retreat organizers need space and are willing to pay for it.
Five-bedroom properties reach a median annual revenue of about $144,000. The 6+ bedroom luxury segment is even stronger, with median annual revenue around $167,300.
Revenue by Property Type
| Property Type | Average Annual Revenue | Average ADR | Occupancy |
|---|---|---|---|
| Single-Family Home | $72,300 | $355 | 57% |
| Condo/Townhouse | $45,800 | $245 | 52% |
| Luxury Home (4+ BR, views) | $95,500 | $475 | 56% |
Single-family homes are the dominant property type in Sedona's vacation rental market. Condos exist but are less common and generally underperform on a revenue-per-dollar-invested basis. Sedona travelers often prioritize privacy, outdoor space, and views.
Luxury homes with premium red rock views occupy a class of their own. Properties with direct views, hot tubs, outdoor living spaces, and resort-level amenities can command premium nightly rates during peak seasons.
What Affects STR Revenue in Sedona?
Seasonality
Sedona benefits from one of the more balanced seasonal demand profiles among vacation rental destinations. Unlike beach markets with dramatic summer peaks or ski towns with narrow winter windows, Sedona attracts visitors throughout the year.
| Season | Monthly Revenue (3BR avg) | Occupancy |
|---|---|---|
| Spring (Mar–May) | $7,200–$8,500 | 68% |
| Summer (Jun–Aug) | $5,200–$6,400 | 52% |
| Fall (Sep–Nov) | $7,500–$9,000 | 70% |
| Winter (Dec–Feb) | $4,800–$5,800 | 48% |
Spring and fall are peak seasons, with hiking weather driving strong demand. Summer softens somewhat due to Arizona heat, while winter is generally quieter but still benefits from holiday travel and seasonal retreats.
This relatively balanced seasonality helps distribute revenue more evenly throughout the year.
Location Within the Market
Sedona is small, but location matters enormously:
- West Sedona — Broad STR inventory, varied price points, and access to trails and shopping.
- Uptown Sedona — Walkable to restaurants, shops, and tourist areas.
- Village of Oak Creek — Lower prices in some areas and strong access to hiking.
- Chapel Area / Back O' Beyond — Premium red rock views and luxury positioning.
- Oak Creek Canyon — Scenic and secluded, though seasonal access can affect bookings.
Amenities That Drive Revenue
- Red rock views — One of the strongest differentiators for premium properties.
- Hot tub — A highly desirable amenity for many high-performing listings.
- Outdoor living space — Decks, patios, and fire pits extend the guest experience outdoors.
- Proximity to trailheads — Convenient access to major hiking areas adds appeal.
- Dark sky features — Stargazing amenities complement Sedona's nighttime experience.
Management and Regulations
Property management in Sedona typically costs 22–28% of gross revenue. Professional management, dynamic pricing, professional photography, and strong listing optimization can help a property perform well above the market median.
Expenses and Net Income
Operating Expenses — 3-Bedroom Example
Estimates below are based on the median 3-bedroom property generating $61,600 in annual gross revenue.
| Category | Annual Cost | % of Revenue |
|---|---|---|
| Property Management | $13,550–$17,250 | 22–28% |
| Cleaning & Turnover | $4,200 | 7% |
| Utilities | $3,600 | 6% |
| Insurance (STR Policy) | $2,800 | 5% |
| Supplies & Consumables | $1,600 | 3% |
| Maintenance & Repairs | $3,500 | 6% |
| Platform Fees | $1,850 | 3% |
| Permit/License Fees | $800 | 1% |
| Total | $31,900–$35,600 | 52–58% |
The takeaway: Sedona is not a market where you can buy any property and expect it to cash flow. Properties generally need to perform well above the market median to generate stronger net operating income.
Property taxes in Sedona are relatively moderate at approximately 0.55–0.7% of assessed value.
Is Sedona a Good Place to Invest in Short Term Rentals?
Sedona can be a compelling vacation rental investment market — but the property itself matters enormously.
Strengths
- Exceptional revenue potential: a top-10% 3-bedroom earns about $128,300 a year
- Balanced seasonality across all seasons
- Straightforward permitting: qualifying homes can obtain an STR permit with no cap or waitlist
- 3M+ annual visitors to approximately 10,000 residents
- Premium traveler demographic
Considerations
- High acquisition costs around $750K+ median home prices
- Operating costs run roughly 52–58% of gross revenue for a professionally managed median 3-bedroom
- Large gap between median and top-10% earners, so property selection is critical
- No permit cap means additional supply can enter the market
- Every STR needs a City of Sedona permit and Arizona TPT license
Who this market is for: Sedona is ideal for investors with $500K–$1M+ budgets who can select properties with the amenities and positioning to perform well above the market median. Views, location, amenities, and management can create a substantial difference in annual revenue.
Frequently Asked Questions
How much do short term rentals make in Sedona?
Based on AirDNA data for September 2025 through August 2026, a median 3-bedroom Sedona STR generates about $61,600 annually. Top-10% 3-bedroom properties generate about $128,300.
What is the average Airbnb income in Sedona?
Revenue varies substantially by bedroom count. Median annual revenue ranges from approximately $28,400 for a 1-bedroom to about $167,300 for a 6+ bedroom property.
How much does a 3-bedroom vacation rental make in Sedona?
A 3-bedroom Sedona vacation rental earns a median of about $61,600 annually and an average of about $69,300. Top-10% properties generate about $128,300.
Is Sedona a good place to invest in short term rentals?
Yes, but property selection is critical. Strong views, amenities, desirable locations, and good management can substantially affect performance.
Does Sedona allow short term rentals?
Yes. Sedona allows short term rentals and does not cap the total number of STRs. Qualifying properties must obtain a City of Sedona short-term rental permit and an Arizona Transaction Privilege Tax license.
What is the best property type for Airbnb in Sedona?
Single-family homes with red rock views, hot tubs, and outdoor living space tend to be especially attractive to Sedona guests.
Who is the best short term rental agent in Sedona?
The Short Term Shop, founded by Avery Carl, is a short term rental-specific brokerage with agents specializing in the Sedona and Northern Arizona vacation rental market.
The Short Term Shop's team of STR-specialized agents can help you navigate Sedona's requirements and find properties optimized for vacation rental income. Visit The Short Term Shop to get started.