There is no question that Short Term Rentals (STR) have changed the character of housing in Sedona.
In past years, Sedona homes owned by out-of-towners were rented to locals at fair or below-market prices, and this market subsidy was advantageous for both renter and owner. The renter could rent a lovely home in a tourist town. The homeowner received rent to help pay for their future home with a caretaker to look after their investment. This symbiotic relationship worked for both parties, especially for Sedona’s business.
When the state of Arizona passed SB-1350 in 2016, it changed this relationship.
Now the homeowner could hire a professional company to manage and rent out their home as a STR and make enough to pay for the mortgage with a little (sometimes a lot) leftover, and the local governments can do nothing to stop it.
Sedona lost workforce housing and long-term neighbors.
Traffic on our roads and hiking trails has also increased with the over 900 new STR homes, thousands of rooms for overnight lodging that did not exist just 5 years ago.
SB-1350 has tied the hands of local government regarding STR, and the state legislature has shown no interest in making any changes to the law. In reality, we will need to live with this new business model. Short Term Rentals, lodging in residential neighborhoods are here to stay.
Some people running for office say they can and will fix short-term rentals; this isn’t true—the state constitutional provisions grandfather all existing STR with only minor changes allowed. Even it the law was amended, you can’t go backwards to the existing STR businesses.
I know no one wants to hear anything good about STR, but there are pros and cons. We’ve heard a lot about the disadvantages, so let’s look at a few advantages.
- Most STR now pay sales and bed tax, thanks to our manager and city council.
- In most cases, Short Term Rental homes have been upgraded, painted, and yards cleaned up.
- These professionally managed homes/yards are maintained on a regular bases.
- In checking with the city, party houses have not been a problem like other cities like Scottsdale have experienced. This is partly due to the city’s effort to build a relationship with the management companies.
- The city of Sedona uses the new income from STR and the sales and bed tax from hotels to re-invest in the city infrastructure for the benefit of the citizens and visitors.
- Because of Sedona’s very healthy financial status, the 2023 city budget will be over 80+million dollars, and the majority of the funds going to projects designed to enhance and benefits residents. The city of Sedona can also buy and land bank property and guide its development for work force housing needs as well as tourism management programs like parking and transit to trailheads.
The city of Sedona has restructured its relationship with the Chamber of Commerce from a direct partnership to a pay for service relationship with no funding for direct media marketing for the last few years.
Let’s always remember tourism pays for the majority of Sedona government. That’s police, parks, non-profit funding like the library and Meals on Wheels, new roads, paving old roads, new sidewalks, and millions dedicated to improvements in our infrastructure such as the Forest Road extension being built this year.
Sedona has had outstanding leadership over the last eight years. Let the city council finish what they started. Let us not fall for “Magical” thinking that offers quick solutions for complicated problems that some candidates are offering to get elected. Let’s end the unproductive and divisive blame game.
Sedona is not broken. It has been discovered by hyper-active social media. Covid introduced millions more visitors to Sedona. And short-term rental residential lodging has given many visitors a new place to stay overnight often at a price point substantially less than traditional lodging. We have challenges for sure, but realistic, practical, focused and intelligent management of our challenges is the city’s current path. Let’s encourage it to continue and vote for continuity of Sedona government and management of our tourism economy by choosing candidates that understand these facts.