LONG TERM VS SHORT TERM RENTAL

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Gray Frame Corner

This is written from the perspective of pre-acquisition. Once you own a property, the decision is a bit different.

Which one makes more money?

In most situations, short-term rentals will make more than long-term.

Which one takes less time to manage?

With Airbnb, you have to constantly turn the property, maintain utility contracts, replenish consumables, maintain the property, and maintain the furniture. With long-term rentals, you have to do many of these processes, but most of them are on an annual or quarterly basis.

How Important is Scalability?

If you plan to add capital to your real estate investment pool quickly, then scalability might be essential. If you grow your portfolio at a few units per year, scaling short term probably will not present any major management problems.

Difference in headaches

I am sure you know the broken toilet at 2 am objection that most people have to real estate investing. While I have actually never had that particular issue come up, there are fires that the owner or manager has to put out on a routine basis. 

The hiccups that come along with a short-term rental are usually different. By the nature of going in and cleaning between each stay, fewer maintenance items build up over time. However, there are a lot of communication-related tasks which require work.

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