Seasonal rental vs. long-term rental

The debate between seasonal and long-term leasing is one that has received increased attention in recent years. Long-term rentals can offer more security in uncertain times, but at the expense of flexibility. Learn more about the advantages and disadvantages of traditional versus seasonal rentals


Advantages of seasonal rental

More opportunities to maximize your income

You will rent your property at a higher rate per night if you have a good occupancy rate. In seasonal rentals, you can also sell additional services to your guests, which can help you generate additional income on top of the rental income.

More flexible pricing

You have the ability to adjust your prices each day based on a wide variety of factors. For example, you can offer discounts for longer reservations or mid-week stays.

The reverse is also true. For weekend bookings, you can charge more. This means you can have two (or more) sets of rates to meet current demand.

You can use dynamic pricing as a lever to optimize your revenues and better manage your cash flow to compensate for variable occupancy rates throughout the year.

Disadvantages of the seasonal rental

Risk of damage

The risk of damage is higher than with a traditional rental. While the majority of bookings do not result in damage, some guests specifically book via Airbnb or other OTAs with the intention of using your property as a party venue. At Swikly, we regularly make collections related to damage caused by parties taking place in our guests' accommodations.

As a result, many guests are more concerned about whether their property will be damaged when renting for a short period of time than when renting for a long period of time. However, since you are renting your property for shorter periods of time, you will have more opportunities to check the condition of your property.

Higher expenses

After each reservation, you will need to clean your property, restock certain items, and possibly replace items that have been damaged or are no longer in working order.

These maintenance costs need to be controlled and complex processes need to be put in place to provide an optimal experience for your travelers.

Irregular income

Don't assume that you will be able to rent your property every day of the year. One month you may be fully booked, while the next month you may only receive one reservation.

In general, your revenues will be seasonal: the location of your properties will play a major role in your occupancy rate because its attractiveness will be the keystone.

In addition, some cities limit the number of days that you can rent out your home on a short-term basis. The current trend is to restrict short-term rentals, especially in large cities. Analyze your market taking these risks into account before committing yourself.

A necessary commitment

To be a successful property manager, you will need to market your properties. To do this, you'll need to take high-quality photos and change them often to fit the season, write captivating descriptions and write reviews for guests. You'll also need to make sure your property is fully prepared for each guest and keep your communication channels open to provide a memorable experience for your guests. Given the much higher turnover rate, this is a lot more work. In short, it's a lot more than just being a landlord!

The seasonal rental is an exciting job but very demanding. It covers an extremely wide range of skills and you must be aware of the task in order not to be disappointed.

Advantages of long-term rental

Regular income

The main advantage of traditional rental is that you are assured that your property will be occupied for a long period of time. This means that you are certain of the amount of rental income that will be paid to you at the end of the month.

Lower tenant turnover

A lower turnover of clients means less work to be done. The time you have to spend cleaning or maintaining your property will be significantly reduced.

In fact, you will only have to act when major interventions are required. Moreover, you can delegate their management to agencies that will be in charge of making the link with the tenant on a daily basis.

Disadvantages of long-term rental

Less flexibility

Long-term rental rates are very strict, especially in large cities, which leaves you little room for maneuver in managing your income.

Not only do you have less flexibility with your pricing, but you also do not have the ability to get your property back on your terms. This can be a handicap if you find that you are not profitable and would like to sell or move to vacation rentals.

Fewer opportunities to maximize your income

You also need to monitor your long-term tenants to make sure they pay the monthly rent on time. Even if a single month's payment is missed, it can have a huge impact on your income. Depending on your location and local rent laws, it can also be difficult to find sufficient grounds to evict a tenant. In addition, if he or she disappears, it may take some time to find a new tenant.

On the other hand, in seasonal rental, the price of the rental is paid before the arrival of the traveler, which assures you to be paid.

You are bound by a lease

You and your host must sign a lease before the rental period begins. This means that you cannot change the price to accommodate demand or introduce new rules until the end of the rental period.

In a nutshell

When it comes to comparing vacation rentals and long-term rentals, there is no clear winner. Seasonal rentals can generate higher rental income, but at a price: Guests must ensure that their accommodations are in an ideal location, which can result in higher upfront costs. Also, if you are not willing to put in the extra work required for this activity, traditional rentals will be the best rental strategy for you.

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