Short-term vs long-term rental

Is it worth letting your flat to tourists on a short-term basis? A property can generate very attractive income. A higher nightly rate also increases the overall profit. On the other hand, long-term letting offers greater certainty of regular income and removes the hassle of accommodating guests. Sometimes, it can even earn more than a short-term arrangement. How should you decide, and what should you take into account?

Published 26/3/24, 2:25 pm

Short-term rentals

Tourists remain highly interested in accommodation in private apartments or cottages. They prefer privacy, the option to cook, use a washing machine and so on over hotel services, and are happy to pay for it. One advantage of short-term rental for owners is being able to use the property themselves when it is not rented out.

What not to forget with short-term rentals

When focusing solely on the financial return from a property, effective pricing is essential for short-term rental to be worthwhile for the owner. At different times and in different locations, a property can be advertised at entirely different prices; the overall context of the property, its location, and the state of supply and demand must all be taken into account.

If you accommodate tourists, remember that you need a trade licence and must pay health and social insurance contributions. Given these costs, it is certainly worth considering whether it is still worthwhile.

You are also required to report foreign nationals to the Foreign Police.

A simple solution

If this seems like too much work and too many obligations, you can rent the flat to us as a company that already holds all the necessary accommodation licences. At Bohemian Estates, we will rent it out on your behalf and take care of the entire process ourselves. We will arrange advertising, communication with guests, guest accommodation and cleaning, and then send the net profit to your bank account. You can still earn considerably more than with long-term rental.

Get advice on short-term rentals

Long-term rental

However, some locations may be so sought after for living that long-term rental prices are already very high. It also makes no sense to try to rent to tourists in purely residential neighbourhoods that hold no tourist appeal. Long-term rental has one clear advantage: regular, stable income.

What not to forget with long-term rentals

Long-term rental also requires effort to bring results.

You need to arrange high-quality advertising for the property so that it stands out among other listings and can be rented out on the best possible terms.
You can consider whether to invest in making the property more attractive and then rent it out for more.
You will also need to communicate with prospective tenants and conduct viewings; choose those with sufficient financial standing.
When signing the agreement, make sure it protects the owner's interests.
Also remember to renew agreements in good time, ensure that liability insurance is taken out, communicate with tenants, keep informed about the condition of the flat and resolve any problems as quickly as possible, so that tenants remain satisfied and the property does not deteriorate.
You will also have administration to deal with, including utility transfers, annual statements of utilities in accordance with regulations, tax returns and so on.

If you would like to leave these concerns to someone else, we are here for you.

If you are still unsure which rental arrangement is more suitable for your property, do not hesitate to ask – we will be happy to advise you.

Get advice on renting out your property