Short-Term Rental and Long-Term Rental

While both fall under the umbrella of rental property investments, these are two different ways to put your money to work in real estate. Short-term rental is letting out a property to holidaymakers for short period usually less than a month. Long-term rental or traditional real estate rental is generally classified as letting out a property for a minimum of 6 or 12 months. 

 

The return on investment on any property will depend on several factors, such as the initial amount invested, location, brand awareness, market demand, and business strategy. It is highly recommended to conduct intensive research into the realistic rental income to set proper expectations.

 

Short-Term Rentals 

Short-term rentals have an amazing surge in popularity because of the online marketplace such as Airbnb, TripAdvisor, and Agoda, these booking platforms connects people who want to rent out their properties to guests who are looking for a place to stay in the locality. 

 

Desert City Stays aspire to make it easy for people to rent their homes in the short term and host some great guests. The most important aim is to make it hassle-free. The guest will also be treated to a luxury stay, enjoying the wonders of Dubai.

 

How much money can you make from short-term rentals? 

At peak season like December, a holiday let can earn as much in a week as you would in a month from long-term rental. Short-term landlords can earn up to 40% more yield than the long-term counterparts.  

 

How short-term rental could earn you three times more income than long-term rental?  

Experts say you can typically earn more from a short-term rental than with a long-term rental with a fixed monthly rent. Whilst the cash flow may not be consistent if you look at the annual income, the short-term rental market will be more rewarding than the long-term one. 

 

Short-term and long-term rental routes can prove to be great investments, but there are factors to consider. Below we look at the advantages of short-term and long-term rental that you should be thinking about before you make that final decision.

 

Advantages of Short-Term Rental 

1.  Higher Rental Incomes 

The biggest advantage of having short-term rental is the potential rental income. Holidays and peak seasons offer an excellent opportunity for vacation rental property owners. You can raise your prices due to in-demand seasons and certain events such as Dubai Expo and holidays. In the peak months like December and January, for example, owners can charge upwards of 100 AED a week for an apartment. 

 

2. Tax Breaks and Great Deductions 

There are many tax perks and deductible property expenses you can benefit from if your property is not being let long-term.  Also, there are lots of common deductions for rental owners. Maintenance, insurance, management fees, and utilities, and more. With enough deductions, you could record a loss and avoid taxes altogether. 

 

4.  Passive Income                                          a

Are you planning to go on holiday? Getting a tenant will not leave your home empty. And, you will have someone take care of your house. By choosing Desert City Stays you would have nothing to worry about and will see your property pay for itself and make you an excellent passive revenue stream. 

 

5.  Flexibility 

Vacation homes give the flexibility to sell, flexibility to rent either short or long-term, better occupancy. For instance, if owners wish to enjoy the space for personal use, they can do it as long as they block off the dates during which they would like to visit. 

 

6.  Less Wear and Tear 

Guests going in and out frequently, you can keep up on small repairs before they turn into big problems. And, since the property is not occupied the whole year round, there is likely to be less wear and tear as compared to a long-term let. 

 

7.  More control

The property owner has more control over a short-term rental and its maintenance, as tenants stay for just a couple of days, weeks, or months. For instance, at Desert City Stays, if you want to still live in your apartment or visit on holidays, we can work out a monthly timetable where you can rent out with us for 18 % +Vat. This gives you the ability to keep using your place or will work best for landlords who are away on holiday and want to make an extra income to cover the holiday costs. 

 

 Advantages of Long-term Rental 

1. Consistent Rental Income 

The ultimate goal of any business is to gain profit, and the way to make money with rental properties is through rental income. Tenants interested in long-term properties plan on staying in that location for an extended period. This leads them to sign long-term leases, which ensures stability and consistency for you and your rental income.   

 

2. Stable Rental Demand 

Demand for long-term rentals come steadier occupancy rates. Renters stay longer in long-term rentals, unlike the nightly or weekend bookings for vacation rentals.  The demand for traditional rental properties has remained unchanged over time. You have a set rental income you can reliably count on, as long as you have tenants.  

 

3.Not as important to have a good agent as the Short-term market 

Your agent expertise won't be as important as in the short-term market. Luckily Desert city stays helps you in reaching your properties full potential by listing it in website with booking available through it and will also be using all other platforms like Airbnb, TripAdvisor, Booking.com, and many more. 

 

4. Less Turnover and High Return on Investment 

Long-term rental is leased on a monthly or sometimes even yearly basis, the turnover is significantly less than with short-term rentals. This is a major benefit for investors as it brings about predictability and a sense of stability. Also, renting to long-term tenants means less administrative worries and generally less guest turnover. 

 

With the set of advantages of short-term and long-term rental, you might want to start renting your property. 

 

If you want to know more, get in touch now, Desert City Stays will help you every step of the way in building your passive revenue stream and reaching your properties full potential.  

 

Tel: +971 45705682 

Mob: +971 506485635 

Website: www.desertcitystays.com 

Instagram and Twitter: @desertcitystays 

Email: contact@desertcitystays.com