Short-term rental - how to start? 10.07.2019

The purpose of a flat or a flat for a short-term rental is undoubtedly a solution that allows you to get income at an attractive, high level throughout the year. At the same time, it is a form of activity that everyone can deal with in theory.

However, before we make the final decision, we should consider several factors and consider whether this is definitely the solution for us?

Bearing in mind the current investment possibilities, including the average interest rate on bank deposits, investing capital in real estate, especially those located in an attractive location, is one of the most reliable methods of earning money. In particular, short-term rental deserves attention. The factor that supports such a solution is certainly the fact that renting a day allows you to get a higher income annually than it is in the case of a long-term lease. In addition, the transfer of property management to a specialized operator significantly reduces the duties belonging to the owner of the premises.

How much can you earn on renting a day?

Monthly income from rental for a day, if the property management entrusted to a professional company, in the vast majority of cases exceed the expectations of the owners. However, to achieve this, it is necessary to trust the selected operator. What's more, a fair company should reliably inform the owner whether a given property in the selected location and finishing standard will actually generate better financial results than in the case of long-term rental.

However, it should be noted that in the case of this type of activity, the quality of guest service is not the only factor influencing the amount of revenue. The others are, among others the standard of the premises, its location, equipment and size, which we wrote about in one of the previous articles on our blog. Apartments in poor condition, before refurbishment or located far from the center, even with the greatest efforts of the manager, will not give the expected income, which also results from the current situation on the market. What does this mean in practice?

The short-term rental market is characterized by large and dispersed competition in the form of not only other apartments for day rental, but also hotels and hostels. So if we want to get to the final customer with the offer, the standard of the premises and the quality of the services provided should be at the highest possible level. Of course, this approach generates additional costs in the form of, among others laundry, cleaning, commissions from intermediary services (eg Booking.com, AirBnB or Expedia), commissions for internet payments etc. Therefore, fully professional rental management in the case of just a few properties does not always go to the proverbial plus.

To sum up: if we plan to transfer one, two or three properties for a short-term rental (eg inherited inheritance) and treated with profit as the only source of income - it will be a high-risk solution and its effects can not be certain. Therefore, especially in this situation, it is worth considering cooperation with a professional operator.

Additional costs

When arranging a flat, which will eventually be intended for rent, we do not have to choose the most expensive materials or products, because a higher finishing cost does not always mean higher sales prices or higher revenues. What is necessary, however, is the basic quality of home appliances and RTV equipment. Thus, if we arrange an apartment in the developer's state, then we should take into account an additional cost of about PLN 1000-1100 / sq m depending on the quality of the equipment.

 

As RentPlanet, we provide our customers with a home staging service, and if they report to us at the stage where the premises are in the raw state, we will advise on its finishing and equipment. In addition, our experienced employees consult the ideas of the owner or architect responsible for the interior design. We will also help in choosing the right insurance, because every owner of an apartment rented for a day should have an appropriate policy.

Who settles the income from short-term rental?

The obligation that is strictly on the owner of the apartment is the settlement of the income received. If the owner has appropriate competences, he can take care of it himself, however, taking into account the complexity of this matter, as well as often imprecise provisions, the recommended solution is to obtain tax advice every time or hire an appropriate accounting office.

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