Sedona AZ Short-Term Rental Market 2026. What StaySTRA Data Shows for One of Americas Most Competitive STR Destinations

Sedona’s average daily rate reached $440 in early 2026, placing this red rock desert town among the highest-priced short-term rental markets in the American Southwest. Think of it this way: a single four-night booking in Sedona generates what some urban STR markets produce in an entire month. That pricing power, combined with $83,895 in trailing 12-month revenue per listing, makes Sedona one of the most interesting data stories in our Sprint 3 series.

But the numbers are not all moving in the same direction. Occupancy has been sliding for four consecutive years while supply keeps climbing. Whether that combination spells opportunity or warning depends on where you sit in the performance distribution. I have spent my morning with a particularly strong cup of black coffee and every data point our system has on Sedona. Here is what I found.

Sedona STR Market Snapshot, February 2026

StaySTRA data shows 1,805 active short-term rental listings in Sedona as of February 2026. For a city with a permanent population of just 10,303, that ratio is staggering. Roughly one in every six households operates as a vacation rental.

The headline numbers for February 2026:

• Average Daily Rate: $440
• Occupancy Rate: 49%
• RevPAR: $212
• Average Monthly Revenue: $5,934
• Trailing 12-Month Revenue: $83,895

February is not Sedona’s peak month. It sits in the lower-middle range of the seasonal curve, which means that $440 ADR reflects a market that commands premium pricing even during its shoulder periods. The revenue percentile spread tells an even more important story:

• Bottom 25%: $2,320/month ($230 ADR, 27% occupancy)
• Median: $4,571/month ($350 ADR, 49% occupancy)
• Top 25%: $7,934/month ($546 ADR, 72% occupancy)
• Top 10%: $12,174/month ($813 ADR, 85% occupancy)

That gap between the bottom quartile and the top quartile is a 3.4x revenue multiple. In my four decades of looking at market data, I have rarely seen a spread that wide in a single market. It tells us that operational quality, listing optimization, and property positioning matter enormously in Sedona. The market rewards excellence and punishes mediocrity with equal intensity.

For a deeper dive into how Sedona stacks up against other market types, see our STR revenue benchmarks by market type.

Supply Growth and Occupancy: The Five-Year Trade-Off

Sedona’s STR supply has grown from 1,113 listings in 2021 to 1,805 in early 2026. That is a 62% increase in just five years. Don’t let that number scare you on its own. What matters is whether demand grew alongside it.

It did not. At least, not proportionally.

StaySTRA data shows Sedona’s occupancy rate declining steadily from 67.9% in 2021 to 53.0% in 2025. Think of it like adding more chairs to a restaurant without adding more tables: each chair gets used less often, even though the restaurant itself is busier than it was before.

The saving grace has been ADR growth. The average nightly rate climbed from $353 in 2021 to $440 in early 2026, a 25% increase that has partially offset the occupancy compression. Monthly revenue per listing peaked at $8,656 in 2021 and settled into the $6,335 to $6,965 range through 2024 and 2025 before dipping to $5,934 in February 2026 (a softer shoulder month).

The pattern here is clear and worth understanding: Sedona is absorbing more supply by spreading demand across more properties, and the properties that remain competitive are doing so by commanding higher nightly rates. The bottom of the market is where occupancy loss concentrates. Top-performing listings maintained 72% to 85% occupancy even as the market average fell.

Seasonal Patterns: Sedona’s Dual-Peak Calendar

What makes Sedona different from the ski resort markets we have covered in this series is its dual-peak seasonal pattern. Ski towns like Park City and Vail concentrate their revenue into one intense winter window. Sedona spreads its strongest months across two distinct seasons.

Spring Peak (March and April): Occupancy reaches 72% with ADR between $389 and $451. Monthly revenue pushes past $10,000 in March and $9,675 in April. This is red rock hiking season, when temperatures sit in the comfortable 70s and wildflowers bloom across the desert.

Fall Peak (October and November): Occupancy reaches 61% in October and 55% in November, with ADR climbing to $471 in October (actually the year’s highest per-night rate). Revenue hits $8,923 in October.

Summer Trough (July and August): Here is where Sedona pays the desert tax. August drops to 39% occupancy with a $357 ADR, producing just $4,610 in monthly revenue. Triple-digit temperatures keep visitors away.

Holiday Bump (December): A $506 ADR in December (the year’s highest nightly rate) signals strong holiday and New Year demand, though occupancy stays moderate at 48%, bringing in $7,618 for the month.

That dual-peak structure is valuable for investors who understand seasonal pricing. Sedona’s average booking lead time of 56 days gives hosts enough runway to adjust rates strategically, and the 4.3-night average length of stay (with a 3-night median) means fewer turnovers per booking dollar than many urban markets.

Scottsdale vs. Sedona: The Arizona STR Comparison

Investors evaluating Arizona STR markets inevitably compare Sedona to Scottsdale. StaySTRA data makes the comparison straightforward.

The surprise here is that Sedona generates 14% more annual revenue than Scottsdale despite a lower point-in-time ADR. Stay with me on why. Scottsdale’s seasonal curve drops more sharply in summer (its June through August ADRs fall into the $306 to $326 range, well below Sedona’s $357 to $398 summer floor). Sedona’s higher summer pricing and its strong fall peak create more consistent revenue across the calendar.

Scottsdale wins on sheer market size (2.5 times the listing count) and peak ADR ($588 in February vs. Sedona’s $440). But for total annual cash flow, Sedona’s smaller, tighter market produces more per listing. That said, Scottsdale’s typical home value sits around $838,000, making the entry cost comparable. The investment math depends heavily on which property you buy and how well you operate it.

For how Sedona compares to mountain and coastal STR markets nationally, see our coastal vs. mountain STR market analysis.

Investment Analysis: Revenue, Yield, and DSCR Viability

Here is where Sedona’s numbers require careful examination. The gross revenue looks attractive, but the entry price creates a challenging financing equation.

The basic math:

• Typical home value: $888,808
• Median sale price: $1,063,333
• Trailing 12-month revenue (market average): $83,895
• Gross yield on typical home value: 9.4%

That 9.4% gross yield looks reasonable until you run it through a DSCR loan structure. At 75% LTV on the typical home value with a 7.5% interest rate over 30 years, the annual debt service (principal, interest, taxes, and insurance) comes to roughly $64,300. After a standard 25% operating expense deduction on gross revenue, the net operating income lands at approximately $62,900.

That puts the DSCR ratio at about 0.98. Just below the 1.0 minimum most DSCR lenders require.

Don’t close the tab just yet. The math changes significantly for above-average operators. Top-quartile Sedona performers generate $7,934 per month ($95,208 annually). After the same 25% expense deduction, their NOI reaches $71,400, pushing the DSCR to 1.11. That clears most lender thresholds comfortably.

The takeaway: Sedona is not a market where you can buy a median property, list it with default settings, and expect the loan to pay for itself. It rewards operators who invest in professional photography, dynamic pricing, and guest experience. The 3.4x revenue gap between bottom and top quartile performers is not random. It reflects real operational differences.

For a full breakdown of how DSCR loans work for STR properties, see our STR financing guide.

Regulatory Landscape: What Sedona Requires and What Arizona Prevents

Sedona operates within Arizona’s state preemption framework, established by SB 1350 in 2016 and refined by HB 2672 in 2019 and SB 1168 in 2022. The framework prevents cities from banning short-term rentals outright or capping the number of permits issued. This is why Sedona’s supply has been able to grow 62% in five years with no regulatory ceiling.

That does not mean Sedona is unregulated. The city’s STR permit program requires:

• Annual STR permit: $210 per unit (increased from $200 in January 2025)
• Transaction Privilege Tax (TPT) license from the Arizona Department of Revenue
• Liability insurance: Minimum $500,000 (unless your listing platform provides equivalent coverage)
• Neighbor notification: Written notice to all adjacent, opposite, and diagonal neighbors with permit number, property address, and 24-hour emergency contact
• Guest background checks: Sex offender registry checks on prospective guests at least 24 hours before check-in, with records maintained for 12 months
• Permits are non-transferable and valid for one year

The big question for Sedona investors is HB 2429, which passed the Arizona House 36-19 in March 2026 and is now before the Senate. If enacted, HB 2429 would allow cities to establish occupancy formulas, permit caps, and minimum distance requirements between STR properties. For a market like Sedona, where STR density is already one of the highest in the state relative to population, this legislation could reshape the competitive landscape in ways that matter for both existing operators and prospective buyers.

If HB 2429 passes, existing permitted operators could gain a significant regulatory moat. New entrants would face a harder path. If it fails, the current open-entry model continues, and supply growth will remain governed by market forces alone.

We do our best to keep our data accurate and up to date, but markets move fast and we are only human. Always verify current figures directly with local sources before making investment decisions.

Run Your Own Sedona STR Analysis

Every number in this article comes from StaySTRA’s Sedona market data. If you want to see how a specific property pencils out, run it through our free Sedona Airbnb calculator. It pulls comparable listings, occupancy projections, and revenue estimates for any address in the Sedona market.