Long Term Rentals V Short Term Rentals
If you’re considering investing in Niseko, you will have no doubt thought about the benefits of renting out your property. Niseko has a thriving tourism trade and there is a considerable return on investment to be had if you choose to rent out the property some – if not all – of the year.
Yet once you have bought a property, the decision as to whether to rent it out to short or long term tenants can often be a difficult one. Indeed, with the rise of platforms such as Airbnb, the choice to rent out in the short term has become a lot easier. However, there are benefits to long-term rentals that can mean it is also a worthwhile option.
There are pros and cons to each model, and this article will walk you through each of them.
Long -term rentals typically mean renting out your property to a single tenant for 8-months or more. This has historically been the most popular avenue for renting a property and provides a host of benefits – as well as some downsides.
What are the benefits of renting my property in the long-term?
Stable and dependable income
With long-term rentals, there is the obvious benefit of a guaranteed income every month. The contract will ensure that the tenant pays you each month – and should they break such a contract – you can typically enforce a fee, or retain a deposit to tide you over until the next tenant signs.
Easier to manage
Whether you choose to manage the property on your own or use SnowDogVillage to manage it for you, there is usually considerably less hassle involved in long-term rentals. With SnowDogVillage you need only worry about the money coming in each month!
What are the downsides to renting my property in the long-term?
Lower return on investment
If you want to get a greater return on your investment, a long-term rental is typically not the most effective way of doing so. In Niseko’s peak winter season you can make a considerable sum from holiday goers in the area if you rent in the short-term. With a long-term rental you will have a consistent income, but miss out on the gold mine of the winter tourism trade.
With short-term rentals, there is always an end to the tenancy around the corner, with long-term, less so. If you find there are difficulties with a tenant, or you simply want to end the contract for reasons of your own, there is often a defined notice period in the contract that will restrict your flexibility.
Short term renting of your property has risen in popularity in recent years. Platforms such as Airbnb and Stayz have made renting out your condo easier than ever. Short-term rental typically constitutes anything from a night to eight months, and come with their own benefits and downsides.
What are the benefits of short-term rentals?
You can rent at your own leisure. Fancy a bit of extra money over the Christmas period? Not in need your property over the summer period? Short-term rentals offer you the flexibility of being to bring on tenants quickly and have them leave just as quickly too.
Higher return on investment
Like any high demand tourist destination, Niseko has its peaks and troughs for visitor arrivals. To make the most out of renting your property, renting in the short-term and charging more for these peak times will garner a greater return on investment.
What are the downsides to renting in the short-term?
Renting out your property in the short-term requires a lot more leg work between tenancies. Cleaning, organising, and getting each tenant set-up in a property can be arduous if you have a high turnover of tenants. However, the benefit of investing in property at SnowDog Village is that all this is managed for you. We have a team based in Niseko who will manage the tenancy process from beginning to end.
This can apply both financially and in respect to the tenant. With short-term rentals, you can’t always guarantee that your property will get an occupant in the low-seasons. Plus, with a higher turnover, there is a greater risk of delinquent tenants – it’s difficult to screen each tenant with the same rigour as if you would for a long-term contract.
What does investing in Snow Dog Village look like?
If you choose to invest one of our stunning condos based in Niseko, you have the added benefit of our services to help you find and manage tenancies for you.
Take the hassle out of either short-term or long-term rental of your investment with our property management services.
There is no right answer when it comes to long-term or short-term rentals. It entirely depends on your needs as well as what reasons you have for renting in the first place.
Each option holds its own pros and cons and will suit each investor differently. Get in contact with us if you would like to learn more or check out some of the properties we have on offer, all ideal for renting!