Short-Term vs. Long-Term Rentals: Which Strategy Works Best in 2025?

Maximising Rental Profits: Which Approach is Right for You?

For landlords and property investors in West Sussex, Surrey, and South London, deciding between short-term and long-term rentals is a crucial factor in maximising rental income. With market shifts, changing tenant preferences, and evolving regulations, 2025 presents new opportunities and challenges for both rental strategies.

So, which approach is best for your property? Let’s compare short-term and long-term rentals to help you make an informed decision.

What’s the Difference?

Short-Term Rentals (Airbnb, Holiday & Corporate Lets)

Typically rented for days, weeks, or a few months
Higher nightly or weekly rates
More hands-on management required
Demand varies based on seasonality and location

Long-Term Rentals (Traditional Tenancies, AST Agreements)

Fixed-term contracts (6–12 months or longer)
Consistent monthly income
Lower management workload
More stable, but lower per-night returns

Short-Term Rentals: Pros & Cons

Pros of Short-Term Rentals

Higher Income Potential – Nightly/weekly rates can be 2-3x higher than long-term rentals.
Flexibility – Choose when to rent and when to use the property yourself.
More Control Over the Property – Frequent inspections help maintain property condition.
Tax Benefits – In some cases, holiday lets qualify for business rates instead of council tax.

Cons of Short-Term Rentals

Higher Management Effort – Frequent check-ins, cleaning, and guest management are required.
Seasonal Variability – Demand fluctuates, particularly in non-tourist areas.
Stricter Regulations – Some councils have licensing rules or restrictions on short-term lets.
Higher Operating Costs – Utilities, furnishing, cleaning, and maintenance add up.

Long-Term Rentals: Pros & Cons

Pros of Long-Term Rentals

Steady, Predictable Income – Rent is guaranteed every month, reducing financial risk.

Lower Management Demand – Fewer tenant turnovers mean less work and lower costs.

Fewer Voids – Longer tenancies mean fewer gaps between occupants.

Fewer Compliance Risks – Short-term rental regulations don’t apply.

Cons of Long-Term Rentals

Lower Rental Yield – Monthly rent is typically lower than short-term rates.
Less Flexibility – You can’t use the property whenever you want.
Tenant Risk – Late payments or difficult tenants may be harder to remove.
Less Frequent Property Inspections – Issues may go unnoticed for longer.

Which Strategy Works Best in West Sussex?

Short-Term Lets Work Best In:

Tourist Areas (e.g., Chichester, Worthing, Arundel, Bognor Regis)
Business & Corporate Hubs (e.g., Crawley, Gatwick area)
High-Demand Seasonal Markets (e.g., South Downs National Park)

Long-Term Rentals Work Best In:

Family-Friendly Suburbs (e.g., Horsham, Haywards Heath)
Commuter Towns (e.g., Burgess Hill, East Grinstead)
University Areas (e.g., Brighton, Chichester)

Which Option Makes More Money?

Revenue Comparison Example (West Sussex, 2025)

Property Type	Short-Term Rental (Airbnb)	Long-Term Rental (AST)
2-Bed Flat in Worthing	£150 per night (80% occupancy) = £3,600/month	£1,500/month
3-Bed House in Horsham	£180 per night (70% occupancy) = £3,780/month	£1,800/month
1-Bed in Chichester	£100 per night (85% occupancy) = £2,550/month	£1,200/month

Short-term rentals earn more, but require more work and higher costs.

What’s the Best Strategy for YOU?

Choose Short-Term Rentals If:

You have time for active management or a lettings agent
Your property is in a high-demand area
You’re willing to handle seasonal fluctuations

Choose Long-Term Rentals If:

You want passive, steady income
You prefer lower maintenance & management effort
Your property is in a family-friendly or commuter area

Final Thoughts: Which Strategy Wins?

Short-term rentals offer higher income but require more work & management.
Long-term rentals provide stable, passive income with less hassle.
Location, demand, and regulations should guide your decision.

Let CPA Property Help You Maximise Rental Profits

Whether you choose short-term or long-term rentals, CPA Property provides:

Expert market analysis to help you decide
Tenant sourcing & management services
Short-let & long-let property strategies