31 Aug Long term rental Vs. Short term rental
For landlords renting out their property, the dilemma between Long-term rental and Short-term rental is always complicated.
You have to know that each option represents a different segment of the rental market and comes with its own challenges!
Let’s start: what’s a short-term rental?
A short-term rental is the renting out of a furnished home or apartment on a nightly basis when the landlord is not present at the property.
Nowadays, short term rental properties are so popular for two reasons: For guests they are cheaper than hotels and, at the same time, landlord incomes are higher than long-term rentals.
These aren’t the only differences. In fact, there are many other Pros and Cons to consider for each scenario.
Long-Term Rental: Pros and Cons
There are some advantages to renting a property long-term. Firstly,landlords will receive monthly rent payments, which provides a constant income even if it’s lower than a short-term rental. In addition, monthly fees can be charged to the tenant should the property require maintenance and so on.
However, it is important to realise that a landlord has a lower flexibility than short-term renting. In fact, the landlord has to choose well in advance when the property can be used by the landlord.
Moreover, the number of tenants looking for a long-term renting is much lower than the number of guests looking to rent on a short-term.
It is difficult to find the right tenant who passes relevant reference checks, and consequently, the risk of having the property vacant for long periods of time is rather high.
Short-Term Rental: Pros and Cons
Short-term rentals provide many advantages like flexibility; the landlords can choose when to rent out the property to short-term guests on a daily/weekly basis.
Additionally, landlords can receive much higher income than long-term rental by charging higher nightly rates; particularly around seasonal peaks.
The disadvantage is that there are many things to manage; booking calendars, check-ins, check-outs and cleanings for example.
A long-term rental represents a good solution for owners that don’t use their flats for long periods of time. The management of long-term rentals is much easier than short-term rentals.
However, by considering total income per year, short-term rental option provides higher final income than long-term rentals. This is the main reason why most landlords choose the short-term rental solution.
As the guests turnover is high, managing check-ins, check-outs, and pre and post rental cleanings become a big hassle for a short-term rental landlord.
Fortunately, there’s the perfect solution that trumps the disadvantages of short-term rentals. You needn’t worry as at FGproperties, we manage your short-term rentals for you. We take care of everything for you.