The Pros and Cons of Short Term Letting

A holiday rental can be a good source of income, but many landlords who seek assistance will pay extra for the higher rental rate on offer. The perception of short-term rentals has significantly shifted in recent years thanks to Airbnb. When compared to a hotel or serviced apartment, a shorter stay in a private home can frequently offer renters or visitors a more relaxing, individualized experience.

Short-term rentals can fetch rates that are around 30% higher than a long-term rental, giving short-term landlords access to a lucrative market. Additionally, the terms of rental agreements and lease extensions are more flexible with short-term rentals.

The process of renting out your home for small periods of time, typically less than six months each year, is referred to as short-term rental. You can charge a higher rental rate with a short let to cover any vacant times. Generally speaking, a rental will cost more when the length of the tenancy is shorter. For a list of benefits and drawbacks of short-term rentals from UpperKey, continue reading.

Should I Consider Short-Term Leasing My Home?

If you're interested in making an investment in a short-term rental property, you'll probably have business professionals who are traveling to or within the UK, tourists searching for a place to stay, or people who require temporary housing as potential tenants. The location is the most important aspect to take into account when selecting a house to rent out temporarily.

Picking a home in the heart of one of the UK's big cities, like London, Edinburgh, or Manchester, is a smart choice. Popular vacation rental homes frequently have convenient access to local amenities including stores, dining options, and public transportation.

The Benefits of Short-Term Rentals

What are the main advantages of vacation rentals?

Most landlords find that short-term leases give them the most freedom and flexibility because they’re able to choose the days, weeks, and months they wish to let out their property. Since tenants will be moving in and out more regularly, there will probably be less wear and tear on your property. As a result, minor problems can be discovered earlier rather than growing into larger ones.

Short lets are very simple to extend. You may benefit from a longer rental period at a higher rental rate, for instance, if you have a tenant who is in town on business and needs to stay a little while longer to close an important deal, or if your tenant is a family who needs a place to stay while their house is being renovated and it is taking longer than they expected.

Important Things to Keep in Mind for Short Lets

In order to determine if managing short-term rentals is the best option for you, there are a number of important factors to take into account. If you want to use short-term rentals as your primary source of income or if you own multiple properties, you might want to think about hiring a company or letting agent to handle your short-term rentals.

Depending on your properties and your needs, property management for a holiday let may include rental property management by letting agents in Europe and the UK, a concierge service for Airbnb and seasonal rentals in tourist hotspots, or key management for holiday lets.

Homeowners in London are now permitted to rent out their property for up to 90 days each calendar year without needing permission thanks to recent changes in the local laws in the UK. If you wish to rent out your property for a longer period of time, you will need to apply for planning clearance, which can be more difficult. Along with this, you must make sure you have the appropriate insurance.

Make sure all of your bases are covered when buying insurance so that you are not put in a difficult situation if something is lost, stolen, or damaged. Additionally, you should carefully review the terms and conditions of your mortgage with your mortgage lender or freehold lease as this may forbid you from renting out your home for vacations.

It's crucial to double-check your information before choosing on the type of letting you give because a mistake now could have serious consequences afterwards.

Finally, with your short lease, be ready for unoccupied times. While it would be ideal if a new tenant moved in at the same time the previous one was leaving, this is almost never the case.

The Drawbacks of Short-Term Leases

While short-term rentals have many benefits, there are also some drawbacks to take into account.

It's critical to be reasonable about what to anticipate from short-term rentals and to acknowledge that it's not always about having more flexibility and earning more money. In contrast to a long-term rental property, you will typically need to be ready to put in a lot more work.

Short-term rentals frequently come fully furnished and with all utilities included, which might result in higher up-front costs for the landlord. You are responsible for making sure the property is furnished with all necessary items, such as fire extinguishers if necessary, and that the costs of gas, electricity, internet, council tax, and the TV license or TV streaming are covered. Take these costs into account when deciding on the rental rate.

While short leases help you identify wear-and-tear issues earlier, there is also a greater risk of wear-and-tear to be cautious of since short-term tenants may not always take good care of a property that they are staying in for a shorter period of time. As a result, you might need to budget more time and money for cleaning, essential repairs, and check-in and check-out procedures.

Last but not least, it's crucial to be aware that short leases are very unpredictable, and it's usual for your short lease property to sit empty during the less busy seasons, which can hurt your profits. Property management firms for short-term rentals can be helpful in this particular situation.

Setting Up a Rental and Collecting the Council Tax

There are a few things you will need to do to set up if you have weighed the advantages and disadvantages and determined that a short-term lease is the best option for you. The first step is to confirm with your local council whether short lets are permitted and, if they are, whether there is a minimum rental duration you must observe when letting out the home.

Next, if you intend to rent out your primary house for a brief period of time, you must confirm that doing so is permitted by the terms and circumstances of your mortgage. The next step is to obtain enough insurance that covers liability for any damages brought on by tenants if you receive approval in both situations. A property damage protection plan, if necessary, is also an excellent choice. These insurance policies will make sure you are financially protected in the event that the rental property is temporarily unavailable for whatever reason.

Making sure that your property complies with all legal criteria for health and safety standards, including fire, electrical, and gas restrictions, as well as fire safety measures, is the last stage in preparing it for rental.

Getting Your Property Ready for a New Era of Renting

After you have taken care of the fundamentals, it is time to prepare your home for marketing and short-term rental. Typically, you'll have to buy furniture for your temporary rental.

It can be wiser to purchase more furnishings for a short-term rental than you would typically do for a furnished long-term rental home. This is because tenants who are only going to occupy a property temporarily are unlikely to buy accessories and other small furniture for it.

All white goods, major furniture pieces including a sofa, bed, bedside tables, dining table and chairs, TV stands, coffee tables, wardrobes, and storage equipment will be requested from you. Additionally, you ought to purchase electrical devices like televisions, lamps, a microwave, a kettle, and at the very least a toaster.

Since tenants looking for a short let will frequently be searching for a more home-from-home feel than something that they will be able to make their own over time, you can sometimes get away with doing more than the neutral décor that is often recommended when renting out a long-term property.

Having said that, keep in mind that with short-term rentals, you may need to touch up the decor more frequently, so it's a good idea to keep it simple with materials and colors that are simple to replace. Last but not least, make sure that the property's utility bills are paid so that the internet, gas, and electricity are all operational throughout the property, and that the council tax is current.

You have the choice of renting out a property for a short period of time or for an extended period of time. Since short-term leases are frequently more expensive than long-term leases, private landlords may find them to be more lucrative. To handle the day-to-day tasks, such as key management and repairs, think about hiring a short-term property management business.

Choosing a Management Company Like UpperKey to Manage Your Short-Term Rental Property

After learning about the advantages and disadvantages of short-term rentals, you may want to rent out your house without having to deal with the hassles associated with managing bookings, listings, guest expectations, and other issues. An Airbnb concierge service like UpperKey can help in this situation.

In London and Paris, UpperKey provides full-service Airbnb property management. We not only take care of all the work involved in running a vacation rental, but we also pay property owners a monthly rent with no effort on their part. To find out how much extra monthly rental income you could receive by giving your property to UpperKey and joining their guaranteed rent program, get in touch with them right away.