Out of all the questions new Airbnb hosts might encounter, one of the most important is whether they should rent long-term or short-term. While it might seem like a simple question at first, there are many things to consider. After all, with Airbnb becoming such a great way of making money in the last couple of years, it is natural that hosts want to come up with an optimal strategy for renting out their property. We will now attempt to answer a few key questions about these different types of Airbnb rentals:
What are short-term or long-term rentals?
What are the pros and cons of short and long-term rentals?
What are short-term or long-term rentals?
While the answer may seem straightforward, it actually differentiates based on where you live. Generally, a reservation time of one month or longer is considered long-term by the Airbnb website. While long-term renting is beneficial for both hosts and guests, hosts must keep up with the laws in their area regarding this subject. Some guests in some areas may be considered tenants after staying for more than a month and are therefore subject to certain rights due to local law.
What are the pros and cons of short and long-term rentals?
As with any two-way decision, renting short or long-term has benefits and hassles. Generally, hosts will want to read up and choose between these two business plans before getting started on Airbnb. We encourage that hosts take time to think about making this important decision regarding their business as it can prove to be a make-or-break moment in their venture into Airbnb.
Pros and cons of long term rentals:
More stable income:
Generally, you can expect stable income when renting your place out for a period equal to or more than a month. This is beneficial because hosts don’t need to worry about check-ins and welcoming new guests as much.
Ability to require agreements:
Long-term hosts can ask their guests to accept a rental agreement form when renting. This can be helpful in regards to managing things such as mailing address permissions.
Guests pay for Utilities:
In long-term Airbnb rentals, hosts can require their guests to pay for utilities such as electricity or water. However, hosts must write about this in advance in their description or notify the guests before they book.
Less flexibility:
Hosts renting out their vacation homes should look out for this one. If you happen to be renting out your villa to a guest, you can’t just cancel it whenever you see fit. So don’t rent out long term if you want to be able to travel to your property on a whim.
Less earning potential:
Long-term rents are synonymous with discounts, and this means that while your income is going to be stable and your worries are going to be less, you simply won’t earn as much. There are no hot seasons to rent your property if you’re in for the long term.
Pros and cons of short term rentals:
Booming income:
With renting short-term comes the ability to rent to tourists during holiday seasons. If you live in a vibrant city, renting short-term might be the thing for you. Tourists looking for short stays for their vacations will generally pay more to stay in the perfect holiday getaway. With all this, and a good Airbnb pricing strategy you can make tons of more money.
More social interaction:
If you’re the type of host that enjoys giving their guests an experience rather than just a rented-out apartment, then short-term rentals are for you. With shorter reservations come more guests, and with more guests comes a variety of new people and cultures to know about.
More flexibility:
This is pretty self-explanatory, but renting short-term allows the host to decide what to do with their property and grants them more time to make decisions.
More maintenance costs:
You are definitely taking more of a risk when accepting short-term reservations. Some of your guests may not be kind to the utilities and equipment at your place, so expect to pay more for maintenance than if you were renting long-term.
Unpredictable income:
While the income may be higher than renting long-term during the holiday season, there’s also always the chance that no one books your place for a few weeks at the time. So if you’re looking for consistent money, this isn’t the best option.
More hassle:
The hotel-like side of Airbnb management really shows itself when renting short-term. With constant check-ins and check-outs and cleaning routines, etc., hosts should be on their toes at all times.
To summarize, Airbnb is a great way to make money for anyone with a place they are willing to rent. But how they make this money depends on what suits them best and what they’re looking for. We hope that hosts can reach that conclusion for themselves using the information presented here and have a great business!
Interesting, helpful points. Thank you!