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Compare a year of short-term letting with a year on a conventional lease for the same property, and see the occupancy short-term letting needs to come out ahead.
Results
Short-term earns more
$9,209.17 a year, before costs both share
Short-term, per year
$33,149.17
Long-term, per year
$23,940.00
Break-even occupancy
49.5%
Below this occupancy, the lease earns more.
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Short-term income is the nights booked times the nightly rate, plus the cleaning fee guests pay on each stay. From that come the platform's host fee, any co-host's share, the cleaner on every turnover, and the running costs a furnished let carries: utilities, internet, supplies and replacements.
Long-term income is twelve months of rent less vacancy, minus management and anything else you pay only as a conventional landlord. The mortgage, property tax and insurance are paid either way, so they are left out: they would lower both results by the same amount and change nothing about which one wins.
The break-even occupancy is the share of nights short-term letting has to fill to earn exactly what the lease does. If your realistic occupancy sits close to it, the extra work and risk of short-term letting may not be worth it.
Short-term letting is closer to running a small hospitality business than to being a landlord: messages, check-ins, restocking and reviews take time every week, and furniture wears out faster. Price your own time, or a co-host's fee, into the comparison.
Many cities restrict short-term rentals with permits, night caps or outright bans, and some charge occupancy taxes. Check the rules, your HOA and your insurance before you count on short-term income.
A unit that would rent for $2,100 a month with 5% vacancy earns $23,940 a year on a lease. Let short-term at $165 a night with 65% occupancy and three-night stays, it books about 237 nights over 79 stays and guests pay $46,263.75 including a $90 cleaning fee per stay.
After a 3% platform fee of $1,387.91, $6,326.67 of cleaning at $80 a turnover and $5,400 of extra running costs, short-term letting nets $33,149.17, which is $9,209.17 more than the lease. It breaks even with the lease at 49.5% occupancy.
This is an estimate from the numbers you enter. Occupancy and nightly rates vary by season and market, and local rules may limit short-term letting.
It can be in strong tourist or business-travel markets, often by a wide margin in gross income. After platform fees, cleaning, furnishing, utilities and the time it takes, the gap narrows, and at low occupancy a lease usually wins.
Look at comparable listings in your area over a full year rather than at peak season. Many markets average somewhere between 50% and 70%, and a new listing with no reviews usually starts lower.
You pay them whichever way you let the property, so they reduce both results equally. Leaving them out keeps the comparison on what actually differs; subtract them from both figures if you want profit.
It depends on the platform and fee model. Some split the fee, charging the host around 3% and the guest the rest; others charge the host the whole fee, often 14% to 16%. Use the figure from your own host account.
Whichever way you let a property, Porchyard keeps its income and expenses together: import your bank statements, categorize each transaction to its property, and compare your rentals side by side. Try it free for 30 days.