Realtors’ Association Launches Comprehensive STR Study Across the County

The Sedona Verde Valley Association of Realtors (SVVAR) is launching a study to assess the economic impact of the short-term rental (STR) industry in the Verde Valley and Yavapai County. This initiative reflects a growing concern among local realtors regarding the misrepresentation of STRs within the community.

With approximately 1,100 members, SVVAR has about 560 primary members active mainly in Sedona and the adjacent Verde Valley. SVVAR president Wyndie Whitney emphasized the necessity of this research, stating, “While many within our community demonize STRs for the various ‘problems’ they experience day to day, we empirically know the vital role they play in our vibrant community.” She added that the study aims to highlight both the economic advantages of STRs and the risks associated with their removal.

Whitney attributed the region’s housing challenges to a lack of development and significant opposition from local residents towards new building projects. The research is being conducted by RRC Associates, a firm renowned for similar analyses in Aspen, Breckenridge, and Jackson Hole. Funding for the study comes from SVVAR’s mobilization fund and the Arizona Association of Realtors.

Local broker Ron Volkman, who previously chaired SVVAR’s government affairs committee, pinpointed property rights as a key motivation for the research. He remarked, “Realtors are defenders of property rights… telling people what they can or can’t do with a home they own is a big deal.” Volkman emphasized that STRs significantly influence the economy in Sedona and beyond.

SVVAR broker Phil Terbell noted the confusion surrounding STRs, stating, “There’s a lot of discussion and a lot of ‘facts’ thrown out that have no substantiation.” He expressed hope that the study would clarify misconceptions, particularly the assumption that eliminating STRs would automatically improve workforce housing availability.

The study will analyze several economic variables, including rental and occupancy rates over the last five years, the actual number of STRs in Sedona and the Verde Valley, their ownership by corporations, tax contributions, and the employment generated by the STR sector. Terbell highlighted that prior studies indicated STRs accounted for up to 50% of tourism-related jobs in other markets, raising curiosity about their role in the local economy.

Volkman pointed out troubling outcomes from STR regulations in other regions. In South Lake Tahoe, for instance, a ban on STRs led to 44% of homes remaining vacant. As communities grapple with STR regulations, some advocates suggest vacancy taxes, aiming to compel homeowners to utilize their properties differently.

Furthermore, both brokers highlighted the adverse effects of overregulation on housing development in the valley. Volkman criticized local governments for hypocrisy in their attempts to reduce development impact fees while simultaneously raising them dramatically. “It’s not genuine. It’s not real,” he asserted.

Terbell suggested that exploring new zoning districts could pave the way for more workforce housing options—a model already adopted by Cottonwood. “How can we create some zoning districts?” he questioned, contemplating innovative housing solutions.

A recent Harvard Business Review study indicated that building restrictions have compounded perceptions that STRs are monopolizing housing units at the expense of residents. Volkman reinforced the idea that homeownership is a fundamental American value, warning against ongoing declines in ownership rates.

SVVAR anticipates the study’s findings by the end of the year and plans to host a town hall in early 2024 to discuss the results with community members. “Hopefully there will be some people on city staff who say, ‘this is true, this could sock us big-time,’” Volkman said. His hope is that tangible data will promote a more rational discourse around STRs, moving beyond emotional arguments to focus on facts.