Profitability of seasonal rentals: our pieces of advice!

Are you planning to buy an apartment in the city center for rent to tourists? You plan to buy a nice house by the sea that will serve as a second home to rent the summer? Before embarking on a seasonal rental investment, you must ask yourself an essential question: that of return. How profitable are seasonal lettings?  

Seasonal rental: a good investment?

Investing in a second home can be very advantageous if you choose to rent it when you do not stay there. This is a great way to finance your mortgage and your expenses, and thus to make a good investment with, ultimately, the prospect of becoming an owner without having to put it out of your pocket. Also think about the quality of the welcome: a human presence upon arrival of the tenants, good advice and good local plans. But to achieve this, you still need to offset your expenses with sufficient cash flow. And for that, you must organize your investment project around this question: how to optimize the profitability of a seasonal rental? What are the criteria to be respected for a better filling rate and revenues high enough to finance the good?

For a good return, you need good management

The profitability in seasonal hiring is generally superior to that of a conventional hiring, that is furnished or empty. Depending on numerous criteria, the net profitability can oscillate between 4 and 10% on average.   However, the advantages and disadvantages must be balanced. Among the advantages is the fact that a seasonal rental removes the risk of unpaid rent (these are often even paid when booking online or at the time of entry into housing). Among the disadvantages, remember that a vacation rental involves a management fee if you are not on site to accommodate tenants and take care of maintenance. In fact, a good profitability in seasonal rentals stems from two prerequisites: the geographical location of your investment, and the dynamism of your management.

The geographic location

As is the case for a conventional rental, the rate of return depends on the difference between the purchase price and the rent income that you can expect from your home.   The location is therefore crucial at two degrees:  
  • The accommodation must be in an attractive area - beachfront villa, apartment in the city center close to tourist sites, chalet in the mountains not far from the ski resorts, etc.
  • It must also be able to be rented enough time in the year to become profitable.

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