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55 Willow Way, Sedona, AZ 86336, USA
Priced too high to cash-flow with a loan — an equity or tax play, not income.
Investment potential
Your scenario · adjust the levers below or open advanced settings to see how returns change
$77,944
$6,495/mo · at 70% occupancy & $426/night
-$1,468
-$122/mo after costs & mortgage
Cap rate
5.8%
Cash-on-cash
-0.7%
DSCR
0.97
Confidence
Your assumptions
Revenue
$77,944/yr
Market avg: $77,944/yr · 70% occ · $426 ADR
Financing
$44,776/yr
Operating costs
$34,636/yr
How this property compares to similar short-term rentals nearby.
Comparable set · 50 properties
$192–$528
Median $428
30%–92%
Median 70%
$35.0K–$146.2K
Median $71.2K
176–365
Median 287
This property · $77.9K
Comparable properties (50)
Cash flow potential Medium · Appreciation potential Medium
365 days available · 241 days booked ·
365 days available · 245 days booked ·
365 days available · 245 days booked ·
365 days available · 238 days booked ·
365 days available · 241 days booked ·
365 days available · 244 days booked ·
365 days available · 241 days booked ·
365 days available · 242 days booked ·
365 days available · 226 days booked ·
365 days available · 228 days booked ·
266 days available · 219 days booked ·
257 days available · 234 days booked ·
365 days available · 209 days booked ·
300 days available · 212 days booked ·
270 days available · 166 days booked ·
284 days available · 172 days booked ·
256 days available · 199 days booked ·
311 days available · 211 days booked ·
265 days available · 183 days booked ·
252 days available · 162 days booked ·
300 days available · 174 days booked ·
262 days available · 169 days booked ·
232 days available · 186 days booked ·
276 days available · 149 days booked ·
234 days available · 157 days booked ·
315 days available · 174 days booked ·
262 days available · 164 days booked ·
339 days available · 205 days booked ·
233 days available · 165 days booked ·
252 days available · 196 days booked ·
291 days available · 157 days booked ·
298 days available · 163 days booked ·
268 days available · 181 days booked ·
252 days available · 131 days booked ·
217 days available · 127 days booked ·
290 days available · 222 days booked ·
272 days available · 132 days booked ·
318 days available · 121 days booked ·
268 days available · 146 days booked ·
281 days available · 134 days booked ·
249 days available · 129 days booked ·
334 days available · 217 days booked ·
185 days available · 138 days booked ·
257 days available · 143 days booked ·
319 days available · 135 days booked ·
298 days available · 103 days booked ·
235 days available · 118 days booked ·
337 days available · 201 days booked ·
176 days available · 134 days booked ·
365 days available · 101 days booked ·
Revenue and occupancy reflect Chalet's modeled estimates from observed booking activity for comparable active listings. Individual results vary with management, seasonality, and pricing.
Who this property is for
The same property is a great buy for one investor and a trap for another. Here's the honest read.
1031 / high-equity buyer
~$184.7K
Year-1 tax shield
Buying with cash or low leverage removes the debt-coverage problem entirely, so the thesis rests on appreciation plus a large first-year write-off. At roughly 25% of purchase price, the shield is substantial enough to carry the deal on its own.
Price-disciplined buyer
$723.3K
Break-even purchase price
Break-even sits only ~3% below the Zestimate, which is inside normal negotiating range. A disciplined buyer has a realistic path to making this work at close to asking.
DSCR cash-flow buyer
0.97
DSCR at asking
At asking price the property doesn't cover its own debt service, so it won't qualify for DSCR financing as modeled. If you need cash flow from day one, look at a mid-term-rental fallback or a different Sedona submarket.
For a buyer who materially participates and qualifies for the STR tax treatment.
$184.7K
Estimated first-year deduction · range $153.3K–$210.6K
Why this matters here
At a marginal bracket, this deduction can be worth $56.7K–$77.9K in estimated federal tax saved.
This only applies if you meet the IRS material-participation tests for short-term rentals and are not using a full-service property manager.
Estimate, subject to CPA review. Cost-segregation percentages shown here are illustrative and depend on an actual study of the property.
Some states do not conform to federal bonus depreciation, so your state may not allow the same first-year treatment shown above.
Chalet can introduce a cost-segregation partner — this is not tax, legal, or financial advice.
How cash-on-cash return moves with purchase price. The marked line is break-even (1.0 DSCR).
At this price: cash-on-cash -0.7%, DSCR 0.97, cash flow -$1,468/yr
| Price vs asking | Price | Cash-on-cash | DSCR | Band |
|---|---|---|---|---|
| -25% | $560,850 | 5.9% | 1.29 | Positive |
| -22% | $583,284 | 4.9% | 1.24 | Positive |
| -15% | $635,630 | 2.8% | 1.14 | Positive |
| -8% | $687,976 | 1.1% | 1.05 | Positive |
| Asking | $747,800 | -0.7% | 0.97 | Below break-even |
| +8% | $807,624 | -2.2% | 0.90 | Below break-even |
| +15% | $859,970 | -3.4% | 0.84 | Below break-even |
Break-even price
$723,276
~3% under Zestimate. Where this property reaches 1.0 DSCR and neutral cash flow.
Discount needed
−$24,524
The gap between asking and the price a cash-flow buyer can underwrite.
If refi to 5.5% in 24 mo
+$6,563/yr
Illustrative cash-flow improvement at asking price if rates fall. Planning figure, not a forecast.
Annual avg $6,495 · peaks at $8,115 in Oct
Annual avg 63% · peaks at 80% in Mar
−$122/mo after all expenses
Cash to close
Down payment, closing costs, and furnishing
$216,862
Return on cash:16.6%
DSCR below 1.0 — but you can still qualify
Your DSCR is 0.97 · lenders typically require 1.0+.
Get matched with 2–3 vetted STR lenders, free.
What the deal returns over the hold — including the tax shield, which is the whole point for an appreciation buyer.
Levered IRR
18.6%
over 5-yr hold, with tax shield
Equity multiple
2.0×
total proceeds vs. $216,862 invested
Projected value at exit
$954,403
year 5 · 5.0% annual appreciation
Tax shield contribution
+7.1 pts
of IRR comes from year-1 depreciation
| Year | Equity | Appreciation | Cumulative cash flow | Total value |
|---|---|---|---|---|
| Year 1 | $192,647 | $37,390 | $66,873 | $296,911 |
| Year 2 | $198,756 | $76,650 | $66,575 | $341,980 |
| Year 3 | $205,307 | $117,872 | $67,462 | $390,641 |
| Year 4 | $212,331 | $161,156 | $69,555 | $443,041 |
| Year 5 | $219,863 | $206,603 | $72,870 | $499,336 |
Projection, not a promise.
Assumes 5.0% annual appreciation, 1.5% rent growth (operating costs held flat), and that the property qualifies for short-term-rental tax treatment. The year-1 depreciation shield depends on a real cost-segregation study and your tax situation — consult a CPA.
Appreciation is the dominant driver of this return. When cash flow is negative, the deal depends on the property gaining value — it is not paying for itself from income.
Appreciation, rent growth, and financing rates are editable under Edit financials.
STR deals turn on local rules and demand that a generalist agent misses. Chalet matches you with a vetted Sedona agent who knows which properties actually cash flow — and which to avoid.
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This analysis is generated by Chalet's Airbnb Calculator
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Real Estate Investment Analysis & Market Insights
Disclaimer
This page and the data presented are for informational purposes only. The information provided should not be construed as financial, legal, or investment advice. Market conditions can change rapidly, and past performance does not guarantee future results. Always consult with qualified professionals before making investment decisions.
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