How Much Do Short Term Rentals Make in Sedona, Arizona?

The median short term rental in Sedona, Arizona generates approximately $18,242 in annual gross revenue for a 3-bedroom property — the most common configuration in the market with 642 tracked listings. But the revenue spread in Sedona is dramatic: top-performing 3-bedroom properties at the 75th percentile earn $32,354, and the top 10% generate $50,229 or more. For larger properties, the numbers climb steeply — 4-bedroom homes earn a median of $31,375, and 6+ bedroom luxury properties hit a median of $59,146 with the 90th percentile reaching $171,851.

These figures come from AirDNA’s analysis of 1,861 active short term rental listings in Sedona. They tell a clear story: Sedona rewards property selection and positioning more than almost any other vacation rental market. The gap between a median performer and a top-10% performer can be 3x or more.

Sedona’s appeal is singular. Red rock formations, spiritual tourism, outdoor adventure, and a luxury-leaning traveler demographic combine to create a market where nightly rates can reach $300+ and 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 — a visitor-to-resident ratio that few destinations in the country can match.

For investors, Sedona presents an interesting proposition: high revenue potential for well-positioned properties paired with limited inventory and strict zoning. The City of Sedona caps the number of short term rental permits, which means existing permitted properties carry significant value and new entrants face barriers. This supply constraint supports pricing power for current operators and makes Sedona STR permits a genuinely scarce asset.

How Much Do Short Term Rentals Make in Sedona?

AirDNA market data across 1,861 active listings shows the full picture — including what separates average performers from top earners:

Revenue by Bedroom Count (2026 Data)

Bedrooms	Median Revenue	75th Percentile	90th Percentile	Sample Size
1 BR	$11,191	$18,010	$28,801	339 listings
2 BR	$15,178	$26,729	$42,534	357 listings
3 BR	$18,242	$32,354	$50,229	642 listings
4 BR	$31,375	$54,378	$80,729	289 listings
5 BR	$39,545	$65,467	$98,207	91 listings
6+ BR	$59,146	$107,010	$171,851	74 listings

Source: AirDNA market data, trailing 12 months. Sample includes 1,861 active listings. Data sourced from AirDNA analysis of 1,861 active listings, trailing 12 months as of May 2026.

The story in Sedona is all about the spread between median and top performers. A median 3-bedroom earns $18,242, but the 75th percentile earns $32,354 — nearly double. That gap is driven almost entirely by property positioning: red rock views, hot tubs, and proximity to trailheads separate the top performers from the pack.

The 4-bedroom segment shows the sharpest jump in median revenue — from $18,242 (3BR) to $31,375 (4BR), a 72% increase. This reflects Sedona’s group travel demand: multi-generational families, friend groups, and retreat organizers need space and are willing to pay for it. With 289 tracked listings, this is a well-established segment.

Five-bedroom properties hit a median of $39,545 with the 75th percentile at $65,467. The 6+ bedroom luxury segment is where Sedona truly shines — a median of $59,146 and a 90th percentile of $171,851, confirming that luxury vacation rentals in Sedona can generate extraordinary returns.

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. The Sedona traveler wants privacy, outdoor space, and views — amenities that homes deliver far better than multi-unit buildings.

Luxury homes with premium red rock views occupy a class of their own. The AirDNA data confirms this: 6+ bedroom properties at the 90th percentile earn $171,851 — these are the properties with direct red rock views, hot tubs, and resort-level amenities commanding $1,000+ per night during peak seasons.

What Affects STR Revenue in Sedona?

Seasonality

Sedona benefits from one of the most balanced seasonal demand profiles in the vacation rental industry. Unlike beach markets with dramatic summer peaks or ski towns with narrow winter windows, Sedona attracts visitors across every season:

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 perfect hiking weather driving strong demand. October is typically the single highest-revenue month as fall foliage against red rocks creates a visual spectacle. Summer sees some softness due to Arizona heat, though Sedona’s elevation (4,350 ft) keeps temperatures 15–20°F cooler than Phoenix. Winter is the softest period but still generates meaningful revenue — holiday travel and winter retreats provide a floor.

This balanced seasonality is a significant advantage for investors. Sedona doesn’t have a three-month peak season that makes or breaks the year. Revenue is distributed more evenly, which means more predictable cash flow and less financial stress during shoulder months.

Location Within the Market

Sedona is small, but location matters enormously:

• West Sedona — Most STR inventory, varied price points, accessible to trails and shopping. Solid all-around performer.
• Uptown Sedona — Walkable to restaurants and shops, tourist-central. Higher occupancy, moderate ADR.
• Village of Oak Creek (VOC) — South of Sedona proper, lower prices, popular with hikers. Good value entry point.
• Chapel Area / Back O’ Beyond — Premium red rock views, luxury positioning. Highest ADR in the market.
• Oak Creek Canyon — North of town, scenic and secluded. Seasonal access issues in winter can impact bookings.

Amenities That Drive Revenue

Sedona guests pay premiums for specific amenities — and the data shows it. The gap between median and 90th percentile revenue is massive, and amenities are a key driver:

• Red rock views — The single most valuable amenity. Unobstructed views can add $75–$150 per night to ADR. This is likely the biggest factor separating median earners from 90th percentile earners.
• Hot tub — Near-essential for top performers. Stargazing from a hot tub is a core Sedona experience.
• Outdoor living space — Decks, patios, fire pits. Guests come for the outdoors and want to enjoy it from the property.
• Proximity to trailheads — Walking distance to popular hikes like Bell Rock, Cathedral Rock, or Devil’s Bridge adds appeal.
• Dark sky features — Sedona is an International Dark Sky Community. Telescopes, stargazing guides, or simply an unobstructed sky view add value.

Management and Regulations

Sedona’s STR permit cap is the single most important regulatory factor. The city limits the total number of active vacation rental permits, which creates a barrier to entry but also protects existing investors from runaway competition. If you’re considering Sedona, confirming permit availability and transferability is step one.

Property management in Sedona typically costs 22–28% of gross revenue. The market is competitive enough that professional management with dynamic pricing, professional photography, and strong listing optimization can push a property from median performance to the 75th percentile — a difference of $14,000+ annually for a 3-bedroom.

Expenses and Net Income

Here’s what a typical 3-bedroom Sedona short term rental expense structure looks like:

Expense Category	Annual Cost	% of Gross Revenue
Property Management	$4,000–$5,100	22–28%
Cleaning & Turnover	$4,200	23%
Utilities	$3,600	20%
Insurance (STR policy)	$2,800	15%
Supplies & Consumables	$1,600	9%
Maintenance & Repairs	$3,500	19%
Platform Fees (Airbnb/Vrbo)	$550	3%
Permit/License Fees	$800	4%
Total Operating Expenses	$21,050–$22,150	115–121%

At the median revenue of $18,242 for a 3-bedroom, the math is tight — expenses can exceed revenue for a median-performing property. This is exactly why property selection matters so much in Sedona. Properties at the 75th percentile ($32,354) have healthy margins, and 90th percentile properties ($50,229) are highly profitable.

The takeaway: Sedona is not a market where you can buy any property and expect it to cash flow. You need to be at or above the 75th percentile to generate meaningful net operating income. That means views, hot tubs, prime location, and excellent management.

Property taxes in Sedona are relatively moderate at approximately 0.55–0.7% of assessed value.

Investors should also explore the short term rental tax loophole, which allows qualifying STR owners who materially participate in their rental activity to use cost segregation and accelerated depreciation to offset active income. In a high-value market like Sedona, this tax strategy can be worth tens of thousands of dollars in tax savings — even if cash flow is modest.

Is Sedona a Good Place to Invest in Short Term Rentals?

Sedona is one of the strongest vacation rental investment markets in the country — but only for the right property. Here’s the honest assessment:

Strengths:

• Exceptional revenue potential for top performers (90th percentile for 6+BR: $171,851)
• Balanced seasonality — no dead months, revenue spread across the year
• Supply-constrained by permit caps, protecting existing operators
• Strong and growing tourism base (3M+ annual visitors)
• Premium traveler demographic willing to pay high nightly rates
• Iconic destination with timeless appeal — not trend-dependent
• Deep data: 1,861 tracked listings provide robust benchmarks

Considerations:

• High acquisition costs (median home price ~$750K+)
• Median revenue for 3BR ($18,242) requires careful property selection to achieve cash flow
• The gap between median and top performers is among the widest of any STR market
• Permit availability is limited and may not be available in all areas
• Regulatory environment can change — stay informed on local politics
• Limited inventory means finding the right property takes patience

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 at the 75th percentile or above. The data shows that median performers can struggle with cash flow, but properties at the 75th percentile ($32,354 for 3BR, $54,378 for 4BR) generate attractive returns. It works especially well for investors who also want personal use — Sedona is one of those places where your investment doubles as a personal retreat.

As Avery Carl, founder of The Short Term Shop, often emphasizes: markets with natural supply constraints — like Sedona’s permit cap — tend to protect investor returns better over the long term than markets where unlimited new listings can dilute demand. But the AirDNA data makes clear that in Sedona, the property you choose matters more than in almost any other market.

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Ready to invest in a Sedona vacation rental? The Short Term Shop’s team of STR-specialized agents can help you navigate Sedona’s permit requirements and find properties optimized for vacation rental income. Visit theshorttermshop.com or contact us today to get started.