Vacation Rental Profitability Calculator

The profitability of a vacation rental is calculated by evaluating the income generated by the property compared to the associated costs, obtaining a figure that reflects how profitable the investment is.

• Location: Tourist or central areas are usually in higher demand.
• Season: Varies according to high and low season.
• Competition: Number of similar apartments in the area.
• Expenses: Taxes, maintenance and fees.
• Purchase and renovation costs: High initial investment reduces profitability.

The net amount is more realistic because it reflects what you actually have left after all expenses. The gross amount is only useful for a quick comparison with other investments.

• Analyze similar rental prices in the same area.
• Consider the average annual occupancy: for example, an apartment can be rented 200 days a year.
• Multiply the daily price by the estimated days of occupancy.

The profitability of a vacation rental versus a long-term rental depends on several factors. Vacation rentals can generate higher revenue per night, especially in tourist destinations, but have variable occupancy and high operating costs. Long-term rentals, on the other hand, offer stable income, lower management costs and less work, but typically generate less monthly income than vacation rentals. The choice depends on location, demand and preference for stability over flexibility.

• Set competitive prices: Research local rates and adjust prices according to seasonality, demand and property characteristics.
• Increase occupancy: Use multiple booking platforms, offer discounts for longer stays and optimize your listing with great photos and descriptions.
• Enhance the guest experience: Offer amenities, ensure cleanliness and offer personal touches to encourage positive reviews and repeat bookings.
• Enhance the property's appeal: Regularly renew furnishings and décor, and maintain the property to attract high-quality guests.
• Automate operations: Use property management tools to automate bookings, payments and communication, reducing workload and improving efficiency.
• Minimize operating costs: Carefully manage utility, cleaning and maintenance expenses to maximize profit margins.