🏠 Real Estate
Short-Term vs Long-Term Rental: Which Earns More?
Short-term lets can gross more than long-term tenancies — but they cost and demand more too. Compare the income, costs, effort and risk of each so you can choose the right strategy.
Updated 20 August 2026 · 2 min read
"Airbnb makes way more than a normal tenancy" is half true — and the missing half is where people lose money. Short-term rentals (STR) often gross more than long-term rentals (LTR), but they also cost more to run and demand far more of your time. Here's how to compare them properly.
Gross income: STR usually wins
On headline revenue, a well-run short-term let in a good location typically out-grosses a long-term tenancy of the same property, sometimes by a wide margin in peak season. That's the number that gets people excited — and it's also the number that hides all the costs.
Costs: STR is far heavier
A short-term let carries expenses a long-term tenancy simply doesn't:
- Cleaning between every stay
- Utilities, wifi and consumables (you pay them, not the guest)
- Furnishing and regular replacement of wear-and-tear items
- Platform fees and higher management costs
- Void nights — every empty night is lost income, not just a late rent payment
By the time these come out, the gap between STR and LTR net income is much smaller than the gross figures suggest. This is exactly why net yield, not gross, is the number that matters.
Effort and risk
A long-term tenancy is close to passive: one tenant, one monthly payment, occasional maintenance. A short-term let is a small hospitality business — guest communication, turnovers, reviews, pricing, and demand that swings with the season and the economy. It's also more exposed to regulation, as more cities introduce short-term-let licensing and night caps.
How to decide
- Estimate STR revenue from real comps using the Airbnb revenue estimator.
- Estimate LTR income and check the net rental yield.
- Subtract each strategy's costs honestly, then compare what actually lands in your pocket — and how much of your time it takes to get there.
For many properties the answer is closer than the headlines suggest, and the right choice depends as much on how hands-on you want to be as on the numbers. Run both and let the net figures — not the gross — make the call.
Frequently asked questions
- Is Airbnb always more profitable than a long-term tenancy?
- On gross income, often yes. On net income after cleaning, utilities, furnishing, fees and void nights, the gap narrows a lot — and sometimes reverses. Always compare net figures, and factor in the extra time a short-term let demands.
- What could stop a short-term let working?
- Local regulation is the big one — many cities now require licences or cap the number of nights a property can be let short-term. Seasonality and weaker demand can also pull occupancy down. Check the rules in your area before committing.