Airbnb Success in the Catalina Foothills – A Family Wealth Builder

[Marcus Adam]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $900,000
Cash invested: $180,000

This was a remarkable investment opportunity and is already operating as a highly successful Airbnb. Located in one of Tucson’s most desirable luxury markets, this single-family residence was purchased on August 19, 2024, for $900,000 with $180,000 cash invested. Designed as a buy-and-hold strategy with short-term rental income, the property is currently producing exceptional results.

Financially, it delivers an impressive monthly cashflow of $16,250, which translates to more than $195,000 annually. This represents an extraordinary 108% cash-on-cash return, far surpassing the typical 8–12% most investors consider strong. In other words, this property is performing at nearly ten times the standard benchmark for Airbnb investments in Tucson.

The success of this Airbnb is driven by several key factors. First, its prime location in the Catalina Foothills provides breathtaking mountain views, privacy, and quick access to both downtown Tucson and Sabino Canyon, making it an attractive retreat for vacationers. Second, it appeals strongly to luxury travelers—especially out-of-state visitors from California, Texas, and the Midwest—seeking a high-end desert experience. Third, comparable homes in this area command nightly rates of $500–$700 during peak seasons, with strong occupancy rates of 75–85%. Finally, its scalability means that even with conservative projections, the property is on track to generate more than $1 million in revenue within five years, before accounting for appreciation and tax benefits.

From a long-term wealth perspective, the home also offers significant upside. Catalina Foothills properties historically appreciate 4–6% annually, which would add $36,000 to $54,000 in equity growth per year on a $900,000 property. In addition, depreciation and potential cost segregation strategies create substantial tax advantages that further enhance returns. The exit strategies are equally strong: the property can continue generating outstanding cashflow as an Airbnb, be converted into a long-term executive rental for consistent income, or be sold in five to seven years with built-in appreciation and a proven rental history, making it highly attractive to future investors.

Ultimately, this investment is more than just a property—it’s a legacy asset. With its combination of powerful cashflow, a prime luxury location, and long-term appreciation potential. Positioned to deliver financial freedom and generational wealth for Alex and his family.

What made you interested in investing in this type of deal?

Alex was drawn to this deal because it combines rare cash flow and long-term security. The property generates $16,250 per month, placing it among Tucson’s top Airbnbs. Its prime Catalina Foothills location—luxury views, proximity to Sabino Canyon and downtown—ensures steady demand from high-paying travelers. For Alex, it wasn’t just about strong returns, but also stability, diversification, and appreciation potential. With 75–85% occupancy and nightly rates of $500–$700.

How did you find this deal and how did you negotiate it?

I found this deal by consistently tracking luxury properties in the Catalina Foothills and targeting homes with strong Airbnb potential—large layouts, great views, and proximity to attractions like Sabino Canyon. This home stood out for its location and high nightly rental demand. During negotiations, I focused on the seller’s motivation and leveraged market data to show realistic pricing while emphasizing a smooth, quick close. By presenting strong terms and positioning ourselves properly.

How did you finance this deal?

Alex financed this deal using a conventional loan, putting 20% down—about $180,000—while the bank covered the remaining $720,000. By choosing a conventional loan, he secured competitive interest rates and avoided higher costs tied to alternative financing. This structure allowed him to keep monthly payments manageable while leveraging the bank’s money to maximize returns. The property generates $16,250 in monthly cash flow.

How did you add value to the deal?

I added value to this deal by identifying and highlighting its short-term rental potential, something the average buyer might overlook. Instead of viewing it as just a luxury home, I positioned it as a high-yield Airbnb by analyzing occupancy rates, nightly rates, and traveler demand in the Catalina Foothills. Alex also guided the setup with professional photography, optimized listing strategies, and pricing adjustments to maximize revenue.

What was the outcome?

The outcome was outstanding. Alex secured the property at $900,000 with $180,000 down using a conventional loan, and it immediately became one of the top-performing Airbnbs in Tucson. The home now generates about $16,250 per month in cash flow, far exceeding typical returns, while also building equity and long-term appreciation in the Catalina Foothills market. Beyond the numbers, the deal provided Alex and his family with diversification, tax benefits, and a proven model they can replicate.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Marcus’s expertise was the key to Alex’s success with this investment. He didn’t just locate a property—he uncovered a hidden opportunity in the Catalina Foothills that many buyers would have overlooked as simply a luxury home. By combining his deep understanding of Tucson’s real estate market with short-term rental performance data, Marcus was able to reveal the property’s true potential as a high-performing Airbnb.