Managing a short-term rental yourself is no easy task. What obstacles must flat owners overcome?
The long-debated areas of the sharing economy, flat-sharing and short-term rentals are major topics across the Czech Republic. This type of business attracts interest not only from prospective buyers of investment flats, but also from existing flat owners in tourist-friendly locations and residents, who in the overwhelming majority of cases resent short-term rentals being operated near their homes. Some city districts also take a negative view of the issue as a whole.
One view held by professionals is that a higher number of flats intended for short-term rental causes city residents to move to the outskirts. While there is no disputing that greater tourist interest in this type of accommodation is one of the factors driving up rents, we must not overlook the positive effects of a greater concentration of tourists in city centres. “For Prague specifically, tourism revenue makes a significant contribution to its GDP. Prague needs tourists, and as long as we, as short-term rental operators, meet all requirements and pay all statutory charges, I see no reason why the city or its residents should conduct such a witch-hunt against us,” says David Novotný, founder and CEO of the independent real estate company Bohemian Estates.
The company also specialises in managing flats intended for short-term rental. “According to the methodology of the Financial Administration, operating a short-term rental is considered an accommodation service, which makes the whole process more difficult for flat owners. Compared with the past, they must now have a trade licence, pay all taxes and charges, and accommodation services are also subject to EET. Although these conditions are fair and entirely understandable, they represent a considerable administrative, time and financial burden,” Novotný points out regarding the challenging aspects of short-term rentals.
Bohemian Estates has therefore come up with a solution that relieves property owners wishing to engage in short-term rentals of all concerns. “If someone decides to work with us and use our rental management service, we sign a lease agreement with them and assume full responsibility. We act as the landlord, so we are responsible for all administrative steps and for paying statutory charges. We then advertise the flat, accommodate guests, and arrange cleaning and maintenance. The flat owner can simply watch their short-term rental generate income,” explains David Novotný about how the service works.
This comprehensive solution enables flat owners in tourist-friendly locations to let their flats on a short-term basis and earn more than they would through a long-term rental. By using a management company, property owners also avoid potential unpleasantness from other residents of the building who dislike the frequent turnover of tenants. “It appears that this dislike is not so much due to noisy tourists, but rather to the fact that more strangers are moving around the building. However, thanks to our many years of experience, internal database and careful selection process, we can influence who rents the flat. In my view, professional flat management for short-term rentals is therefore the most practical solution for everyone involved,” concludes Novotný on behalf of Bohemian Estates International.