Arizona is a very sought-after location for real estate investors. The Grand Canyon State is home to a number of hot housing markets like Scottsdale, Tucson, and Phoenix – which is actually one of Trulia’s Top 10 Housing Markets to Watch. On top of that, Arizona is also incredibly welcoming to Airbnb real estate investors!
According to our data and predictive analytics, buying Arizona vacation home rentals can be a very profitable investment. Wondering which are the best cities to buy Airbnb properties in the state? Keep reading as we explain why and where to invest in a vacation rental property in the Arizona real estate market.
What Makes Arizona Vacation Home Rentals a Smart Investment?
1) Arizona Is a Hot Tourists’ Destination
Arizona is home to a number of American landmarks such as the Grand Canyon, Hoover Dam, and Petrified Forest. Not only that, but it also hosts a number of unique events that are sure to keep bringing in visitors all year round.
As a matter of fact, the vast land of Arizona welcomes over 40 million tourists each year! Both nature lovers and those looking to spend time in big cities continue to flow into Arizona for the favorable climate and entertainment venues that the state offers.
Horseshoe Bend, Arizona
Of course, the strong tourism industry supports the short-term rental market. It’s become very common for tourists (both domestic and international) to look at Arizona vacation home rentals rather than hotels. As a result, many cities in Arizona are emerging as desirable locations for investing in short-term rental properties.
2) Properties Are Diverse and Well-Priced
Buying vacation homes can mean something different depending on your budget and the type of rental property you’re hoping to invest in. But in a state as vast as Arizona, any real estate investor is bound to find what he/she is looking for.
Whether you’re looking to invest in a luxury condo in an urban environment or a quiet cottage with refreshing pools and mountain views, there’s a vacation home in Arizona that meets your criteria.
Furthermore, while the Arizona real estate market is more popular now than it was a few years ago, it’s still very possible to find rental properties for sale at a very reasonable price in many cities.
According to data from Mashvisor’s Investment Property Calculator, the Arizona median home price is $409,172. While this is above the national average, it’s much more affordable for real estate investors than neighboring states like California ($1,026,681) and Colorado ($547,100).
Moreover, that is only the median price for the state. You’ll notice in the list below that the median home price in the best cities to buy Arizona vacation home rentals is cheaper.
No matter what your taste or budget is, you can find lucrative rental properties for sale that meet your criteria in a matter of minutes with our Property Finder!
3) High Airbnb Rental Income
According to Mashvisor’s Investment Property Calculator, Airbnb real estate investors in Arizona make a median monthly rental income of $2,044. Combined with reasonable property prices, this makes Arizona vacation home rentals a smart investment as investors are able to get the most out of their investment.
A high Airbnb rental income helps property investors pay the costs that come with investing in a vacation rental property. These include state and local taxes, cost of utilities, property maintenance, and insurance. In fact, according to Airbnb Citizen, the short-term listing site generated $11.5 million in tax revenue in Arizona in 2017 alone!
Also, if you keep your investment property in good shape and are a good Airbnb host, you can easily pay down your mortgage and generate profit by renting out your Arizona vacation home when you’re not using it!
In addition, by choosing the right property management company, your Airbnb rental income becomes passive and you won’t even have to set foot on the property to make money in real estate.
If you want to learn more about how to generate high Airbnb rental income, read our 4 Tips for Successful Short Term Rental Properties.
4) Arizona Short-Term Rental Regulations
The final reason why Arizona vacation home rentals make for a smart investment is the fact that the state is incredibly friendly to the home-sharing economy.
New Airbnb laws protect property owners’ rights to use this rental service and Arizona has gone as far as making it illegal for cities to ban or restrict Airbnb rentals. There are also no restrictions on how many rental properties investors can own or a limitation on the number of days that a home can be rented out.
Furthermore, Arizona signed Senate Bill 1382 which requires all short-term rental sites to collect and remit state and local taxes. Airbnb has already been doing so after a voluntary agreement with the state in 2017. Now, other sites like VRBO and HomeAway have to register with the Arizona Department of Revenue and collect taxes on short-term bookings.
Therefore, real estate investors of Arizona vacation home rentals don’t have to collect additional taxes from their guests and make payments to the state and local authorities. Instead, the site will do that on their behalf. All of these regulations make owners of Airbnb investment properties happy investors.
To start looking for and analyzing rental properties in the best cities to invest in Airbnb in Arizona, click here.
One thing to keep in mind, however, is homeowner’s associations. If your vacation home is governed by an HOA community, you need to carefully review their rules around Airbnb investments. HOAs in Arizona have a right to place restrictions or completely ban Airbnb rentals.
So, Airbnb investors should seek a consultation with an Arizona real estate lawyer to better understand how laws and HOA restrictions may impact their ability to invest in Arizona vacation home rentals.
Related: Four Things to Consider Before Purchasing an Airbnb Investment Property
Where to Invest in Arizona Vacation Home Rentals
Do you want to find a vacation home for sale in Arizona to rent out as a short-term rental? Then you must be wondering where exactly should you start your property search. Don’t worry, Mashvisor’s got you covered! Below is a list of the best cities to buy Airbnb properties in the Grand Canyon State according to Mashvisor’s Investment Property Calculator.
Our predictive real estate analytics show that investing in Airbnb short-term rentals here will more than cover your expenses, providing you with good cash on cash return. To learn more about our tool and how we will help you make faster and smarter real estate investment decisions, click here.
Sierra Vista
- Median Property Price: $214,609
- Price/Square Foot: $111
- Airbnb Rental Income: $2,295
- Airbnb Occupancy Rate: 61%
- Cash on Cash Return: 6%
Tombstone
- Median Property Price: $190,663
- Price/Square Foot: $143
- Airbnb Rental Income: $1,662
- Airbnb Occupancy Rate: 45%
- Cash on Cash Return: 5%
Kingman
- Median Property Price: $217,576
- Price/Square Foot: $123
- Airbnb Rental Income: $1,721
- Airbnb Occupancy Rate: 53%
- Cash on Cash Return: 5%
Page
- Median Property Price: $328,243
- Price/Square Foot: $160
- Airbnb Rental Income: $3,053
- Airbnb Occupancy Rate: 54%
- Cash on Cash Return: 5%
Cottonwood
- Median Property Price: $322,161
- Price/Square Foot: $184
- Airbnb Rental Income: $2,626
- Airbnb Occupancy Rate: 49%
- Cash on Cash Return: 4%
Avondale
- Median Property Price: $252,763
- Price/Square Foot: $132
- Airbnb Rental Income: $2,142
- Airbnb Occupancy Rate: 51%
- Cash on Cash Return: 4%
Tempe
- Median Property Price: $337,365
- Price/Square Foot: $200
- Airbnb Rental Income: $2,389
- Airbnb Occupancy Rate: 51%
- Cash on Cash Return: 3%
Tucson
- Median Property Price: $282,402
- Price/Square Foot: $147
- Airbnb Rental Income: $2,147
- Airbnb Occupancy Rate: 55%
- Cash on Cash Return: 3%
Gilbert
- Median Property Price: $384,694
- Price/Square Foot: $174
- Airbnb Rental Income: $2,418
- Airbnb Occupancy Rate: 45%
- Cash on Cash Return: 3%
Sedona
- Median Property Price: $859,647
- Price/Square Foot: $312
- Airbnb Rental Income: $3,949
- Airbnb Occupancy Rate: 66%
- Cash on Cash Return: 3%
The Bottom Line
If you want to buy Airbnb properties, you can’t go wrong with Arizona vacation home rentals. Not only is it one of the most Airbnb-friendly states in the US, but it has everything investors look for in a profitable location for real estate investing. This includes strong rental demand, affordable properties for sale, and high rental income.
The best time to buy an investment property in Arizona is NOW before home prices start to go up. So, what are you waiting for? Start out your 7-day free trial with Mashvisor now to start and end your search for lucrative rental properties in some of the best cities for Airbnb investment.