Short-term or long-term apartment rental in new builds?

Long-term rental is a simpler and more predictable choice for most new-build investors. Short-term rental can yield higher returns, but requires more work, building approval and tolerance for fluctuating occupancy. Before deciding, check the specific building's rules and review your finances with professionals.

How the two models differ

With long-term rental, you enter into a long-term lease, the tenant lives in the apartment as their home, and you receive regular payments. With short-term rental, you accommodate guests for days or weeks, manage each stay separately, and income varies by season and demand.

Aspect	Long-term rental	Short-term rental
Income	Regular, predictable	Fluctuating, season-dependent
Owner's effort	Lower, mainly focused on handover and maintenance	High: bookings, cleaning, key handovers, guest communication
Wear and tear	Lower, tenant takes care of the apartment	Higher, frequent guest turnover
Furnishings	Basic or unfurnished	Fully furnished apartment, furniture and linens
Building relationship	Usually no special restrictions	May conflict with building rules
Risks	Non-payment of rent, longer search for new tenant	Vacant periods, neighbour complaints, rule changes

Building rules and legal framework

New builds are typically apartment buildings with an owners' association or management company and building regulations. It is often decided there whether short-term accommodation is permitted. Before buying, request the bylaws, building rules and information on how the building handles short-term rentals. Some buildings restrict or prohibit them, and rules can change over time.

Short-term rental may also be subject to local taxes, guest registration, reporting to authorities and property usage requirements. Conditions vary by local authority and change. Don't rely on general internet information. Verify with a lawyer or the relevant authority, and check how the apartment is registered in the cadastre and building documentation.

How much work is involved

Long-term rental requires work mainly at the start: selecting a tenant, drawing up the lease, and signing the handover protocol. After that, you mainly handle routine repairs and service billing. If you live elsewhere or hold the investment alongside employment, this is the easier model.

Short-term rental is like running a small accommodation business. Bookings, guest communication, cleaning and linen changes happen constantly. You can outsource these tasks, but that reduces net returns. When comparing, calculate net income after deducting all costs, not the gross nightly rate.

How returns and risks differ

Short-term rental can generate higher gross income with good occupancy. However, occupancy depends on location, season, competition and apartment furnishings. In areas with tourism or business travel, demand is more stable; elsewhere, there may be more fluctuations. Learn more about how locations differ in our locations overview.

Long-term rental offers smaller fluctuations. However, vacant periods between tenants also cost money, as mortgage payments and monthly expenses continue. To compare both options, create a budget with reserves for empty periods, repairs and management. A calculator can help you try different scenarios.

Financing and tax

Banks may assess rental income differently depending on whether the contract is long-term and documented. Short-term rental income is harder to verify. If you plan to finance the investment with a mortgage, consult a mortgage specialist before selecting your apartment.

Tax treatment of income may differ between the two models, for example depending on the scope of services and business structure. Verify conditions with a tax advisor or accountant and don't rely on estimates.

How to decide when choosing an apartment

• First, clarify how much time and energy you want to invest in this.
• Find out the building's rules and the developer's policies. You can browse these in the developers section and the projects catalogue.
• Compare purchase prices and indicative rents in the area. The new-build prices overview can help.
• Smaller apartments rent easily to both types of tenant; larger apartments are more often rented by families on longer terms.
• Choose an apartment with practical layout, quality facilities and good accessibility.

The general purchase process is described in the buying guide. If you're not sure where to start, you can use our housing inquiry form.

Frequently asked questions

Can I combine both models?

Theoretically yes, for example seasonal short-term and otherwise long-term. In practice, building rules and tenancy agreements limit this. Have a lawyer verify the approach.

Which model is better for a beginner?

Usually long-term rental, as it's less time-consuming and easier to plan. Short-term rental suits those who have time to manage it or can outsource it to professionals.

Should I rely on the seller's projected returns?

Treat it only as a guide. Verify independent comparable rents, costs and building rules, and discuss the calculation with an expert.