What is short rent and how profitable is it to rent a luxury apartment?

The real estate market is constantly evolving, and one of the latest trends in the sector is the so-called short rent, which stands in contrast to long-term rentals. Is it worth renting a luxury apartment? What are the pros and cons? How profitable is it? These are the questions we will answer in the following paragraphs.

What is Short Rent?

Short rent can be translated as short-term rental and involves renting out fully furnished apartments for a limited period. Short-term rentals are further divided into two categories: tourist rentals and transitional rentals.

Tourist rentals involve a maximum stay of 30 days and do not require the registration of the contract with the Revenue Agency. Transitional rentals range from 30 days to 18 months and do require contract registration.

Short rent provides greater flexibility for property owners, allowing them to rent out the property when they desire, possibly when they are not using it themselves. Depending on the season, different rates can be set. For example, higher rates can be applied during high season and a minimum rental period can be required to maximize profits. One-day stays are not particularly advisable because the earnings are limited and they require additional activities such as check-in and check-out within 24 hours, cleaning, and other bureaucratic tasks.

On the flip side, due to seasonality, income is not always guaranteed, especially during low season when bookings are scarce. In the long run, short rent can become demanding, especially for those who want to manage this activity as a hobby or as a secondary income without too much commitment.
How Profitable is it to Rent a Luxury Apartment?

Currently, the greatest opportunities in the real estate market are concentrated in the luxury segment, which is not yet fully saturated and therefore holds potential to be discovered. A luxury home rented through short rent can yield a gross return of 5% to 7% per year.

However, it is important to consider that while short-term rentals offer the possibility of higher returns, they also come with higher costs. Tenants with short-term contracts might perceive the house as a “disposable” item rather than something to be preserved. The final return naturally also depends on the location and type of apartment, but in general, there is a significant growth in short-term rentals of houses and luxury properties.