Vacation Rental Market Analysis: Sedona, AZ

The Evolve Team
The Evolve Team
February 22, 2023

Surrounded by stunning natural beauty and packed with soul-nourishing adventure, Sedona is a highly sought-after vacation destination.

Nearly 3 million visitors flock to this desert hotspot every year. Travelers can’t get enough of the endless outdoor activities and rich downtown scene, which includes numerous shops and art galleries. With tourism at the heart of Sedona’s economy, buyers can be very successful with a Sedona investment property.

To help you understand the investment opportunity this top vacation rental market presents, we created a free, downloadable vacation rental market analysis — perfect for potential buyers

Inside you’ll find: 

  • Rental income potential by property size
  • Average occupancy by property size
  • Average daily rate by property size
  • Average days booked in advance
  • Average length of stay
  • Vacation rental inventory by property size
  • Occupancy rate by month

The findings in this analysis are based on Evolve’s average Sedona real estate market trends in the last year and provide a general baseline for performance potential. They’re designed to help inform smart buying decisions when shopping for Sedona investment properties.

Download Our Complete Sedona Vacation Rental Investment Analysis

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Why Sedona Is a Great Place to Own Vacation Rental Property

Sedona’s epic landscapes, spiritual energy, and wide range of things to do draw a broad base of interest — from solo adventurers and relaxation seekers to large families (especially those celebrating weddings). Given this group size variety, investors can earn the attention of guests with vacation rentals big or small.

Guests tend to flock to Sedona during the spring and fall when temperatures are ideal for hiking and mountain biking. So while many destinations only see one, Sedona experiences two high seasons. For investors, this translates to double the opportunity to grab peak season bookings (and income).

That said, Sedona is an expensive market to buy into, with median home prices hovering around $860,000. However, there are properties available above and below that price point. If your budget only allows for a smaller upfront investment, keep an eye on the market to find options that best fit your price range.

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How Much Money Can You Earn with a Sedona Vacation Rental?

The annual draw of Sedona means investors can take home solid earnings with the right property. To gauge what your full potential looks like, consider these important factors:

Property Size

Larger homes tend to perform better in Sedona, with five-bedrooms earning the highest occupancy rates and the most annual income. This makes sense given they’re prime options for group gatherings and family-friendly reunions. Five-bedrooms make up the smallest percentage of inventory, though, so they may be harder to find.

Just because larger Sedona investment properties are the highest-earners doesn’t mean smaller alternatives aren’t great options. Three-bedroom homes, for example, fall just behind five-bedrooms when it comes to annual nights booked on average, and make up about a quarter of the local supply. 

And since solo adventurers and relaxation-seeking couples flock to Sedona, studio apartments and one-bedroom homes can see strong demand, too. (A studio was actually Evolve’s top-booked home in the area last year.) So regardless of the number of bedrooms you’re seeking, you have profitable options across the spectrum.

Property Location

Since hiking and outdoor recreation are major draws for Sedona travelers, proximity to trails and state parks is major. Our real estate experts say the ability to drive or take a shuttle to popular outdoor destinations is a huge plus for guests, and could grab you more bookings at higher rates.

Thankfully, Sedona offers epic landscapes at nearly every turn. If you’re unable to invest in a vacation rental close to popular outdoor attractions, securing a property that offers stunning views is another great way to impress guests.

In addition, Sedona’s booming art scene makes easy access to town important. Centrally-located properties give guests more opportunities to dine, shop, and learn about Sedona’s rich culture. So, look for homes that offer a balanced commute between downtown hotspots and outdoor must-sees — it can add value and help you nail down five-star reviews.

Property Amenities

According to our experts, the most successful Sedona investment properties take cues from their environment. Consider homes with expansive windows that capture the views, and then translate Sedona’s look and feel to how you decorate the interior. Incorporate local artwork and southwest-inspired color palettes that complement the red rock of the mountains to create an immersive and unforgettable experience for your guests.

Since travelers spend most of their time enjoying the natural beauty of Sedona, having usable outdoor spaces can help boost their comfort levels at your home. Set up shaded areas with lounge furniture for easy unwinding after a day of exploring.

In addition, our data shows that a pool is one of Sedona travelers’ top amenity picks, likely because the summer temperatures skyrocket. If you’re not able to invest in a rental with a private pool, look into options that offer access to a community one. You’ll likely have to pay a monthly visitor fee, but won’t have to worry about the extra expenses that come along with maintaining a pool on your own.

Lastly, offering updated kitchen appliances, televisions, streaming services, and gaming consoles will help set your property apart from the market. See how you can implement each of these amenities when buying a Sedona investment property to create right-at-home comfort.

When you’re ready to ride the Sedona real estate market trends, make your search easier by starting with vetted homes for sale.

Download Our Full Sedona, AZ Vacation Rental Market Analysis

With a stronghold on outdoor adventure and culture, Sedona’s tourism industry continues to be a huge part of what makes this peaceful desert town so valuable for vacation rental investment.

Whether you’re looking to buy an investment property or hoping to turn an existing home into a money-maker, download our free Sedona Vacation Rental Market Analysis to get a head start.

It’s filled with helpful insights, like:

  • Average daily rate by property size
  • Expected seasonality in vacation rental demand
  • Average length of stay in high and low seasons
  • Inventory breakdown based on property size

Evaluating Sedona investment properties shouldn’t leave you between a red rock and a hard place. Use our report to gear up with key industry knowledge and start earning passive income as a vacation rental owner.

Get Your Vacation Rental Market Analysis

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