Long-Term Rentals vs. Vacation Rentals 

Anyone who wishes to invest in property to put it up for rent, later on, can consider both long-term and short-term rentals. Any real estate investment can be turned into a long-term rental while vacation properties are the best choice for short-term ones.

It is possible to turn your own home into a long-term rental by renting out a specific portion or one floor. Alternatively, if you wish to become a vacation rental host, then it is a good idea to opt for an Airbnb hosting masterclass. However, if you are confused regarding both, then you are in the right spot. Today, we shall look at the advantages and disadvantages of vacation rentals and long-term rentals to help you decide.

What Is a Long-Term Rental?

A long-term rental is leased out to a tenant on a year’s lease and a fixed monthly rate. Some landlords may allow leases for greater than a year.


Defined Income

The rental income stays the same throughout the year. The landlord is paid on time and can lease out their property for a year or even more. Budgeting, maintenance, and utility costs are easier to manage with fixed rent coming in every month. This way, profits also stay steady.

Lower Turnover

Signing/negotiating a lease, marketing, and property maintenance often take a toll on the landlord. These tasks need to be conducted less often with a long-term rental. Single-family home renters may often renew their leases which eliminates repeated paperwork.

Reduced Financing

Long-term leases allow the landlord to enjoy reduced bouts of inoccupancy and high repair/maintenance costs. Long-term tenants usually clean and take care of basic duties around the property such as yard cleaning, utility bill payment, and home maintenance which reduces the financial and task burden on the owner. Management and maintenance fees for a long-term property can be anywhere between 8% and 10% monthly. This is as high as 30% of the rent amount for short-term rentals due to constant tenant movement.


Greater Need for Repairs and Maintenance

Repairs and maintenance requirements may be sometimes difficult to get a hold of before they blow out of proportion in the case of long-term rentals. To ensure tenants stay comfortable and their privacy is not violated, landlords often conduct inspections quarterly or biannually. Requiring notice and fewer inspections means that problems can often not be solved immediately.

Rent Cannot Be Raised As Freely

A major drawback of long-term rentals is the inability to raise the rent whenever you wish. A lease ensures the rent price stays consistent for each month and landlords can only raise the rent once a new lease needs to be issued.

What Is a Short-Term Rental?

Short-term rentals are offered to tenants on a monthly, weekly, or daily notice. Short-term rentals include vacation rentals, house hacking, or a single-family home with monthly rent.


Allows Flexibility

Renting short-term allows an owner to practice flexibility especially if they are hoping to sell off their property. Most buyers do not want their home to be rented out to a tenant so keeping tenants short-term eradicates this issue.

Greater Earning Potential

Since rent can be adjusted easily and often with a short-term rental, investors can make a great income by focusing on seasons, events, and weekends. This pays off greatly with a vacation rental where demand is greater for short-term stays and there are loads of visitors. This can help an owner generate income two to three times greater than the average monthly rent made on a long-term rental.

Easy Maintenance

Since tenants stay for a short duration, the landlord can easily inspect the property regularly. This prevents repairs and faults from blowing out of proportion and also means reduced maintenance costs. It also becomes easier to clean and refurbish a property right after a tenant leaves in preparation for the next one.


Strict Laws

Some municipalities and towns have very strict laws and regulations for short-term rentals, especially vacation rentals. Based on the HOA or city, owners may be restricted to certain times during the year and may also have to pay occupancy tax. Occupancy tax is similar to hotel room tax charged for tourist stays.

Greater Operational Expenses

A vacation or short-term rental may be easier to maintain, but it has greater operational expenses. This is because tenants often use short-term rentals as an alternative to a hotel stay. You will have to make sure the property is clean and well-furnished and offers basic luxuries to keep tenants attracted. You will have to purchase cleaning supplies, kitchen utensils, snacks, sanitary, and bedding and will also have to pay utility bills. A landlord is responsible for gas, water, electricity, Wi-Fi, cable, and even garbage disposal. All of these have to be cut out from the profit an owner makes.


Both types of rentals come with their own list of pros and cons. It is totally up to you to decide which one you think suits your taste and requirements best. Make sure to input thorough research before investing so that you do not face any troubles later on.

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