The Benefits of Short-Term Rentals for Apartment Owners

Short-term rentals, also known as vacation rentals, offer numerous advantages for property owners. This model has gained significant popularity in recent years, especially in tourist cities like Paris. As an owner, it is essential to understand why more and more people are opting for this type of rental and how it can benefit you. Here’s an overview of the main advantages.

1. Higher Rental Income

One of the primary benefits of short-term rentals is the potential to generate more significant income compared to long-term rentals. The nightly rate for a short-term rental is often higher than what you would get from a yearly rental. For instance, if you rent an apartment in Paris for €150 per night with an average occupancy rate of 70%, you could earn more than you would with a standard monthly rent for the same property.

Additionally, you have the flexibility to adjust your rates according to the season, local events, and demand. During peak times, such as holidays or cultural events, you can increase your prices and maximize your earnings.

1. Flexibility for the Owner

Unlike traditional rentals, short-term rentals offer great flexibility. If you need to use your property for personal reasons or wish to live in it part of the year, this is possible with vacation rentals. You can control when your property is available, allowing you to maintain control over your real estate.

Moreover, if you plan to sell your property in the near future, short-term rentals allow you to generate income while waiting for a favorable transaction.

1. Reduced Risk of Non-Payment

With long-term rentals, one of the biggest risks for owners is non-payment of rent. With short-term rentals, this risk is significantly reduced, if not eliminated. Rental platforms like Airbnb or Booking require payment at the time of booking, ensuring that you are paid even before the guest arrives.

This secures your income and spares you from dealing with debt recovery procedures.

1. Active Management, Simplified by Platforms

Managing a short-term rental requires more involvement, but platforms like Airbnb, Booking, or Vrbo have made this task much easier. These sites handle many of the administrative aspects for you, such as payments, booking confirmations, and even communication with guests. There are also specialized concierge services that can take care of day-to-day management, from check-in to check-out, as well as cleaning and maintenance of the property.

For owners who lack time or prefer not to be directly involved in property management, these services are an excellent option.

1. Improved Property Maintenance

With frequently changing tenants, you are regularly prompted to check the condition of your property. This allows you to quickly identify minor maintenance or renovation tasks before more significant issues arise.

Additionally, the constant turnover of guests gives you better visibility into the overall condition of your property, helping to prevent substantial damage that can sometimes occur with long-term tenants.

1. Diversifying Rental Risks

With long-term rentals, you generally rely on a single tenant for your income. If that tenant leaves or stops paying, your income can drop. However, short-term rentals allow you to diversify your risks. Even if a booking is canceled or a guest cannot stay at your property, you always have the option to find other renters, often on very short notice.

This enables better handling of unforeseen events and helps maintain a steady flow of income.

1. Benefiting from Attractive Tax Advantages

In France, owners who opt for non-professional furnished rentals (LMNP) can benefit from advantageous tax arrangements. Income from furnished rentals is considered business income (BIC), allowing you to deduct certain expenses and amortize the property.

The micro-BIC system offers a 50% flat-rate deduction on rental income, significantly reducing the taxable base.

For more information on the taxation of short-term rentals, check out this article: https://www.journaldunet.com/patrimoine/immobilier/1173555-la-location-meublee-les-regles-du-jeu/

Conclusion

Short-term rentals offer numerous advantages for apartment owners. Whether in terms of flexibility, higher income, reduced risks, or tax benefits, this model can be particularly lucrative and well-suited to the needs of property owners. However, it is essential to understand the associated legal and administrative constraints and ensure that the management of your property is optimized to attract quality tenants.