Comparison

Sedona vs Cottonwood: where should you buy an Airbnb?

Two very different markets 20 minutes apart. Here's how they compare on revenue, prices, taxes, and rules, from an agent who operates five rentals in Cottonwood and helps clients buy in both.

Last updated October 18, 2026

SedonaCottonwood
Average annual STR revenue~$63.3K~$38.2K
Occupancy (TTM Sept 2026)57%57%
Average daily rate$337$202
Active STR listings3,729 (broader market)282
Home pricesMedian sale ~$1.08MTurnkey STRs listed ~$515K–$995K
Combined lodging tax~13.3% (Yavapai) / 13.9% (Coconino)~8–9%
Local requirement$210/unit annual permit, $500K insurance, guest background checks, no eventsAnnual city registration (Ord. 731), emergency contact, neighbor notice
Casita/ADU rentalsEach unit permitted separately; newer detached ADUs limitedDepends on zoning and permitted structures
Best forPremium, view-driven, appreciation and personal useCash flow, small units, multi-unit parcels

Sources: AirDNA Sedona, AirDNA Cottonwood, Redfin Sedona, City of Sedona, Cottonwood Ord. 731. Third-party estimates, not guarantees.

Choose Sedona if…

  • You want a premium, view-driven property
  • Appreciation and personal use matter as much as cash flow
  • You can carry a $1M+ purchase and stricter compliance
Sedona guide →

Choose Cottonwood if…

  • You want lower entry prices and a clearer path to cash flow
  • You like small units, casitas, or multi-unit parcels
  • You want a lower lodging tax and lighter rules
Cottonwood guide →

Don't forget the Village of Oak Creek

If you want red rocks without Sedona city rules, the Village of Oak Creek became far more interesting in 2026, when its master HOA's rental ban was declared unenforceable.

Run both scenarios in the STR return calculator or read our operator's take.

Sedona vs Cottonwood FAQ

Is Cottonwood or Sedona better for an Airbnb?

Sedona earns more per listing on average (about $63.3K vs $38.2K per AirDNA), but costs far more to buy and has stricter rules and higher taxes. Cottonwood often suits investors focused on cash flow and lower entry prices; Sedona suits premium, appreciation-focused buyers.

How far is Cottonwood from Sedona?

About 15 to 25 minutes by car, depending on where you are in each town. Many Cottonwood guests spend their days in Sedona.

Thinking about an Airbnb in Sedona or the Verde Valley?

Book a free consult. We will talk through your budget, timeline, and goals, and give you a straight answer about whether a short-term rental here fits.

Book a free consult