Short Term Rental vs Long Term Rental: 5 Signs Your Dubai Property is a Short Term Rental Gold Mine
Updated: Sep 12, 2021
If you have a rental property in Dubai, you may be wondering, “What are the perks of a short term rental business model vs a long term rental?”. Many assume that any rental property located in a touristy neighborhood has obvious short-term rental potential; however, that is often not the case. Below are 5 signs your property has superior earning potential as a short-term rental.
Consider the Short Term Rental Business Model
As hotels and other traditional forms of accommodation lose their appeal, short-term rental properties have become a much more attractive option for those looking to explore new places for a staycation, travel or business. One of the most important factors in any short term rental business model is flexibility. If you can envision your property appealing to a wide cross-section of accommodation seekers, you could be taking your first step to realizing better real estate investment returns.
5 Signs That Your Property Shows Promise in the Short Term Rental space
There are clear differences between what makes a good short-term rental vs long-term rental, there are certainly features of your property that can help you decide if yours has short-term rental potential. Below, you’ll find what are considered as positive signals that you may be sitting on a mini ‘gold mine’
1. The Right Neighborhood and the Right Building
Dubai is home to many bustling and friendly communities which appeal to wide variety of accommodation seekers. To name just a few, Downtown, DIFC, Dubai Marina, and Palm Jumeirah all have their own charm and cater to so many different sorts of lifestyles and audiences.
Your building plays a significant role in your property’s ability to drive short-term income. Those that are centrally located and/or have favorable amenities can make a short-term renter’s trip much more enjoyable. These features are also what helps to set your property apart from the rest.
Pro Tip: If you own a property in The Five Residences on Palm Jumeirah, you’ll be doing yourself a favor by contacting a reputable short-term rental operator for an earnings assessment. The earning potential can be shocking!
2. The WOW Factor
In the relentlessly competitive world of Airbnb search algorithms, user engagement begets user engagement. Meaning, when a listing possesses 2 or 3 photos that users just can’t help but click, there’s a snowball effect which is sure to produce significantly better returns for an investor.
In this regard, it is instructive to highlight a very common mistake many short term rental ‘1st-timers’ make. Often, an investor will be inclined to fill a property with a hodgepodge of tattered furniture, with no cohesive interior aesthetic. After six months, they’ll conclude that short term rental ‘didn’t work’.
Pro Tip: If you’re considering short term rental, and are thinking I’ll just “give it a try with some old furniture I have”, you’d likely be better off just renting it long term, because you’re very likely setting yourself up for failure (that being said, properly outfitting a property for short let, does not require expensive furnishing - it does require a clean and cohesive design aesthetic however)
3. Amazing Amenities
Dubai is a location associated with luxury, top-notch amenities, and exclusivity. The city’s average apartment building features conveniences and comforts that rival those of five-star luxury resorts – think: Fitness Centers, Pools, Children's Play Areas, etc.
Accentuating amenities and highlighting the nuances that make a property standout is critical. No amenity is too small to mention, as something which seems inconsequential to you, may just be the deciding factor for a guest. The availability of a range of different amenities ensures that your property is in competition for the most number of searches.
4. Size Counts
Believe it or not, larger properties perform better in relation to smaller ones. Studios and one-bedroom properties have too much direct competition with hotels and resorts in Dubai. When it comes down to pricing and inclusions, for those smaller-sized properties, the hotels will usually make the most money here. On the other hand, larger properties that hotels can’t offer, provide the opportunity to accommodate more people in a luxury setting. Much more economical than trying to book multiple hotel rooms for upwards of ten or more people!
5. Having The Right Operator
Dubai is a city of excellence, so accommodations must meet these standards. A short-term apartment rental agency is essential to ensuring that your property is home to the best service. Short-term rental properties require a sophisticated approach to operations and customer service.
It’s just simply not possible to match the sophistication on offer with hotels and resorts by managing a short term rental without an agency. More people are flooding to these well-managed high-end short term rentals in a market that exceeded half a billion AED in 2020 alone!
It’s a necessity to manage your property's pricing with AI technology that monitors current trends in holiday-stay accommodation – If you don’t have the tools of the trade working on your side, your property is just not going to deliver the returns that an investor should expect.
Short Term Rental Property Management Company
A short-term rental property management company provides the many services required to successfully manage and run your rental locations to their most optimized capacity. The right short-term rental agency can use AI-powered pricing tools and daily operational services that offer hospitality rivaling the city’s international resorts.
If you think your property matches this description, let’s chat over some coffee about how we can turn out the best profits from your Dubai real estate OR share this article with someone you may know – they may just be sitting on a ‘gold mine’.
If you'd like to learn more about why the Short term rental market is set to thrive in Dubai, check out our blog post on the topic here