12/16/2025
🌵WHAT BREAK EVEN ACTUALLY LOOKS LIKE FOR A SCOTTSDALE AIRBNB👇
Imagine you’re considering buying a 4 bedroom, 2 bath home with a heated pool in Scottsdale to run as an Airbnb. Let’s break down the numbers in a straightforward way so you can see what “break even” really means in this scenario. We’ll look at it with a typical mortgage (since most people finance these deals) and also consider what it looks like if you paid all cash. All the figures here assume the property is already fully furnished (so you’re not shelling out extra for furniture) and that you’ll use a professional property manager charging about 18% of your rental revenue. We’ll use hard numbers throughout based on a detailed forecast for this specific property!
The Scenario: 20% Down, 6.75% Interest, 30-Year Loan...
First, let’s set the stage with the purchase and financing details. We’re assuming:
Purchase Price: roughly in the ballpark of $1.1 million for this Scottsdale home (since it’s a 4 bed with a pool, fully furnished).
Down Payment: 20% of the purchase price (around $220k down).
Loan: 80% financed (about ~$880k loan principal). We’ll use a 6.75% interest rate on a 30 year fixed mortgage for calculations.
Monthly Mortgage Payment: Approximately $5,800 per month for principal and interest. This comes out to about $69,600 per year in debt service. (Yes, rates are pretty high right now – that’s a big chunk of the expenses!)
Along with the mortgage, you have the usual suspects for holding costs: property tax, insurance, utilities, etc. We’ll get into those numbers next. But keep in mind: with financing, your upfront cash investment is the down payment (~$220k) plus closing costs, instead of the whole purchase price. The trade off is you’ll have a hefty mortgage payment every month eating into your rental income....
👉 Now let’s talk about what kind of income this property might generate as an Airbnb in Scottsdale. You can expect to gross around $75K on the low-end & $125K on the high end for a property like that.
For this example we will be assuming $95,000 in gross Airbnb income for the year.
That number can happen a few different ways depending on nightly rates and occupancy. For example, if average nightly rates were around $500, that would mean roughly 190 booked nights for the year or about 52% occupancy. If nightly rates averaged closer to $400, then $95,000 would require closer to 238 booked nights which puts occupancy closer to the mid 60% range.
Some months are strong. Some months are weak. That’s Scottsdale!!
March (peak season) might bring in about $14,000 to $15,000 for the month.
July (dead of summer) might only bring in around $5,000 to $6,000.
Most other months fall somewhere in between. Overall, the yearly gross rental revenue in this scenario comes out to $95,000. This $95k is before any expenses. It’s the top line number.
Note: We are not counting cleaning fees in this gross revenue because typically you charge guests a separate cleaning fee that essentially gets passed through to your cleaners. In other words, the guests pay for cleaning and that money goes to pay the cleaning crew. It’s usually a wash for you as the owner.
👉Operating Expenses Breakdown...
Running a short-term rental isn’t cheap especially if you factor in full-service management. Here’s a breakdown of the annual expenses you’d have for this property, given the assumptions:
Property Management (18% of gross): About $17,100 per year at $95k revenue.
Listing/Platform Fees (10% of gross): Approximately $9,500 per year.
Mortgage (Principal & Interest): $69,600 per year.
Property Taxes: Around $5,124 per year.
Homeowners Insurance: Approximately $5,004 per year.
Utilities (Electricity, Water, Sewer, Trash): About $4,200 per year total.
Pool Maintenance: $1,800 per year.
Landscaping: $1,800 per year.
Pest Control: $1,200 per year.
Cable/Internet/Streaming: $1,500 per year.
Supplies & Misc: $900 per year.
Short-Term Rental Permit: $250 per year.
Cleaning Fees: $0 shown here because the guest pays this separately and it passes through to the cleaner.
If you total up all those annual expenses, you’re looking at roughly $117,978 per year in costs to run this property with a mortgage and a manager.
Total Expenses (with financing): ≈ $117,978/year
👉With the given assumptions, the property does NOT break even on a yearly basis when you have a mortgage.
At $95,000 in gross revenue and approximately $117,978 in expenses, the property is running at a loss of about:
-$22,978 per year, or roughly -$1,915 per month.
That is not a rounding error. That is not a few extra booked nights. That is a meaningful monthly out-of-pocket expense.
Another way to look at it is this: because management and platform fees together take about 28% of gross revenue, you only keep about 72% of what the property makes to cover fixed costs.
Your fixed costs are roughly $91,378 per year.
To truly break even with financing you would need gross revenue of approximately $127,000 per year OR need to increase your initial downpayment.
That is the break-even number for this setup.
👉Now let’s run the exact same $95,000 revenue scenario assuming you bought the property all cash.
The only thing that changes is the removal of the $69,600 per year mortgage payment.
Your fixed expenses drop from $91,378 down to about $21,778 per year.
Management and platform fees remain $26,600 per year.
So total annual expenses in the cash scenario come out to about $48,378.
With $95,000 in gross income and $48,378 in expenses, that leaves you with roughly:
$46,622 in net income per year, or about $3,885 per month.
The Reality Check
Same house.
Same guests.
Same management.
The only difference is the mortgage.
At $95,000 gross revenue, a financed deal is not breaking even.
At $95,000 gross revenue, a cash deal can still be a solid income property.
This is why gross income numbers matter and why I always walk buyers through this before they write an offer.
Break even isn’t a feeling. It’s math. And the math changes fast when revenue drops.
With today’s interest rates, financing a Scottsdale Airbnb usually doesn't mean breaking even. That doesn’t make it a bad deal. It just means the return is long term, not monthly cash flow.
If you buy cash, it can be a strong income property.
If you finance, it’s usually a long term hold that mostly pays for itself.
Neither option is wrong. They’re just very different. Most people hear “$120,000 a year Airbnb” and assume that’s what they make. It isn’t. I’d rather show you the real numbers upfront than have you surprised later!
If you’re still interested in getting into the Scottsdale Airbnb market, you can view...
👉Old Town options here: https://www.unrivaledmountainviews.com/old-town-scottsdale-short-term-rentals-airbnb-vrbo-properties-for-sale/
👉And Kierland options here: https://www.unrivaledmountainviews.com/north-scottsdale-short-term-rentals-airbnb-vrbo-properties-for-sale/
All of these properties have a pool and are located in NO HOA areas with no short term rental restrictions. Some may already be operating as Airbnbs.
IF YOU WANT A LIST OF ONLY EXISTING AIRBNB PROPERTIES THAT ARE TRUE TURNKEY BUSINESSES, SHOOT ME A MESSAGE AND I’LL SEND IT OVER. I HAVE TO MANUALLY RUN THE SEARCH FOR YOU.
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Fathom Realty
Https://www.christopher-drusen.fathomrealty.com
