Short-term apartment rental – pros and cons

It is said that real estate is currently a very good investment. Year after year, the prices of apartments, plots and houses rise significantly. So it’s worth investing and buying an apartment in an interesting area. Even if you need to take out a mortgage for the apartment, the rent can easily cover the monthly installment. If you already have an apartment in a big city or a tourist town, short-term rental can bring quite decent profits. However, you have to be prepared to devote your time and constantly keep an eye on the business.

Of course, in a small town or a location of little interest to tourists, long-term rental will be more profitable, because with short-term rental the owner may not find enough guests per month. But for an apartment by the sea, in the mountains, or in larger cities attractive to tourists such as Wrocław, Warsaw or Łódź, short-term rental is a great business idea.

Pros and cons of short-term rental

Renting out apartments by the night means a greater investment of time and money, but also a chance for higher monthly earnings.

Why is short-term apartment rental profitable?

• specifying the maximum number of children allowed in the apartment and, possibly, the preferred age of the children, if this matters to the owner;
• There is currently strong demand for apartments, which are an interesting alternative to expensive hotels. In addition, savvy customers prefer to organize their own trips, accommodation and attractions rather than use the services of travel agencies.
• The opportunity to earn well. Assuming you rent out a two-room apartment for PLN 200 per night, you can already earn PLN 2,800 a month with just 14 days of rental. If the apartment were rented for 25 days a month, the owner would earn PLN 5,000. After deducting costs, you can count on higher earnings than with long-term rental.
• The highest income can be earned by owning apartments in cities and places attractive to tourists.
• You can protect your interests with a security deposit or an additional fee for cleaning the apartment after the guests leave.

What are the downsides of short-term apartment rental?

• The need to invest your own time. Accepting bookings, answering phone calls, organizing cleaning. It’s a business in which you have to keep your finger on the pulse all the time.
• There is always a risk that outside the tourist season we will find few people interested in renting the apartment, so earnings may not always be satisfactory.
• The standard of the apartment should be very good, so every now and then it’s necessary to invest in refreshing the apartment or changing the decor.

What can you offer guests besides the stay itself?

When we want to go to the mountains, the seaside or a bigger city for a few days, we look for a cozy apartment in a good location where we can spend a pleasant time. So it has to be interestingly furnished, impress with its accessories and be tidy. Nowadays, thanks to the internet and platforms such as Booking, AirBnb or OLX, when looking for an apartment to rent we are literally flooded with offers. Therefore, the apartment owner has to make their apartment stand out and provide the highest quality of service so that guests choose that particular offer.

Many people visiting a given city for the first time don’t know where to look for specific services. So you can prepare a small information guide (on paper or on a website) about the most important tourist attractions, interesting places, good restaurants or service companies that may come in handy.

For people with children, an added bonus will be a children’s corner in the apartment (with a few toys or games) and the option of adding a travel cot or a child’s chair. When going away for the weekend or on vacation, not everyone has someone to look after their dog, cat or guinea pig. So pet owners look for a place where they can come with their pet. Of course, the apartment owner can state in the rental terms that pets or children under 10 are not allowed, but this will narrow the target audience.

Apartment guests may come to the city for tourism, family or business purposes. It’s worth preparing something for bad weather or a lazy evening in the apartment after a tiring day, too. In such situations, internet access, a TV with Netflix or HBO Go, and board games will be an additional asset.

Marketing an apartment for short-term rental

To rent out an apartment and make a profit from it, you need to take marketing actions that will let potential guests learn about your offer. So it’s worth:

• creating a fan page on social media, e.g. on Facebook;
• investing in a website with the option to book the apartment;
• registering the property on Booking.com and AirBnb.com;
• creating a business profile for the apartment on Google My Business.

Loyalty programs work not only in the restaurant industry but also in the property rental industry. You can offer guests a 10% discount for 3 visits to the apartment, or a free night on their next visit for stays of at least 5 days. Loyalty programs help build a lasting relationship with the guest. Every single visit is welcome, but a satisfied regular guest will choose the offer again and recommend it to friends.

Keep in mind that when choosing an apartment to rent, guests are guided by reviews of the place. Unfortunately, the tendency is that dissatisfied people post reviews online much more often than people who are fully satisfied with the service. So it’s worth encouraging your guests to post positive reviews on Facebook or Google if they were happy with the service. You can even offer a small discount for adding such a review. The more of them there are, the greater the chance that the apartment will be highly competitive on the market.