Our Airbnb Finances — From Purchase to Profit

Martin Beechen
May 7
3 min read

Quick Summary:

Bought for $1.03M in April 2024
Spent $170K on renovations and setup
Launched in October 2024 with no reviews
Grossed $14,387.50 in March 2025
On track for a 6.2% annual cap rate

Why Sedona?

Sedona is small—just 9,000 people—but it draws over 3 million tourists a year with it's stunning views, dining, and options for outdoor fun in the sun. With strict limits on hotel development, short-term rentals like Airbnbs meet the demand that hotels can’t. That made it the perfect place for us to try something new.

The Purchase

The home was originally listed at $1.2 million, but it had been sitting on the market for a while. It had issues—bright pink paint, orange interior, awkward staging, old fixtures—and was listed as a 3-bed, 2-bath, even though there was a fourth bedroom and a massive laundry room that could easily be turned into a bathroom. Amazing location though and stunning views.

Here are some shots from the original listing.

We negotiated the price down to $1,030,000. That worked out to just $380 per square foot—a significant discount, considering most homes in Sedona were going for $500 to $750 per square foot at the time.

This gave us a solid foundation to create value through renovations.

Renovation Breakdown

We put in $170,000 to turn it into a modern, vacation-ready home. Here's how that broke down:

$40,000 – Bathroom upgrades + new 3rd bath
$30,000 – Backyard and spa
$10,000 – Exterior paint + stucco
$8,000 – Interior paint
$100,000 – Furniture, lighting, and guest essentials

The final result: a stylish 4-bed, 3-bath home made for short-term stays.

The Launch

We opened in October 2024 with no reviews and low rates—around $250 a night—to build momentum. Early on, we hit bumps: broken appliances, damaged furniture, and more hands-on effort than we were used to from long-term rentals.

But slowly, things turned around. Rates climbed. Bookings increased. And as of today, we’ve earned 42 five-star reviews, which has directly translated into stronger pricing power and weekend rates that now regularly hit $500–$600 per night.

March 2025 Financials

Here’s what a steady month looks like:

Rent collected: $12,797.50
Cleaning fees collected: $1,590.00
Total revenue: $14,387.50

Expenses:

Airbnb fees: $431.62
Cleaning: $1,704.01
Utilities: $410.34
Management: $3,583.30
Maintenance: $888.07
Property taxes: $405.04
Insurance: $166.17

Gross profit: $6,798.95

Occupancy: 75% (21 nights booked)

Property Management

Trying to manage this ourselves from out of state would have been a headache. We hired a local team that handles everything: bookings, cleanings, guest questions, and small repairs. That’s been key.

It costs a lot but we get a lot for it.

Final Thoughts

Right now, this Airbnb holds a steady 6.2% cap rate, making it one of the stronger performers in our portfolio. And that will just go up over time. When we first launched, it hadn’t stabilized, we had no reviews, and we had to price aggressively just to get bookings. It took some faith and patience to get here—but we’re really happy with how it’s turned out.

One of the biggest perks? We actually use it. Every month or so, we head down for a weekend or a few days during the week. It’s not why we bought it, but it’s a huge bonus. And staying there ourselves keeps us in touch with the guest experience—we love it, and that reassures us that others will too.

**Note: I intentionally didn't discuss debt or loans as part of this post. Yes, we used debt to buy this. No, I don't include that when evaluating cap rate. That's a subject for another post. :)