What’s going to happen with Sedona short-term rentals in 2022?
Here is the forecast- And this is all based on what happened in 2021 & 2020, as well as expected market and economic changes this year, including raised interest rates.
Cash on cash return (for our clients) this year will be over 15% and more likely, 20% – 40%. Cash flow will be over 10%, and more commonly at 15%. With some improvements, cash flow will be closer to 20%.
In 2021 Sedona Short term rentals received approximately 30% appreciation. Even with raised interest rates this year, as well as other predicted changes, STR’s in Sedona will receive 30% – 35% appreciation.
The buyer pool for STR’s in Sedona is aggressive. The available STR inventory is extremely limited. As a result, we have high appreciation and high rental occupancy. As a result, it’s an excellent time to buy in Sedona. However, it’s important to know that due to the aggressive buyer pool and fierce competition, it’s helpful to mentally and emotionally prepare yourself for the offer/bid experience.
Expect 10% to 60% purchase price above asking price, and commonly half of the offers will be cash. Usually the financed offers come in higher than the cash offers.
Also, it’s important to financially prepare for offers. You need proof of funds or a pre-qualification/pre-approval lender letter before making any offers. In addition, based on purchase/contract prices being higher than listing prices- For EX: If you know that your maximum price is $1,000,000, then you likely will not want to offer on properties that are over $950,000.
