If you haven’t opened a short-term rental, what is holding you back?

Question

Curious what the real barriers are right now. A lot of investors seem interested in STRs but never actually pull the trigger.

Local regulations, Startup costs, not sure you'll know how to run it/ get it set up, markets/ area concerns, Something else?

I’m seeing more investors debate this lately, especially in markets where LTR cash flow is tightening.

Devvrat Kumar · Answer

I enjoy long term rental because it gives me more time to scale my portfolio. With the effort and time spent in short-term rental, the margins are not that huge compared to long-term rental.

Mohammed Rahman · Answer

Regulations are usually the first thing that makes people pause. Even when STRs are allowed, investors want clear answers on zoning, HOA rules, and how enforcement actually plays out in a specific pocket of the city. A lot of hesitation comes from not wanting to close on a place and later find out there is a restriction they missed or a rule that suddenly tightens up and changes the numbers.

Startup costs are another big one. People often underestimate what it really takes to get STR-ready. It is not just furnishing a place, it is furnishing it specifically for short-term guests, durable setups, staging, photography, supplies, insurance differences, and sometimes small upgrades just to make the home perform well. That upfront cost tends to feel higher than expected compared to a traditional rental.

Operationally, that is where a lot of deals slow down. Investors like the income potential, but running it like a hospitality business is a different level of involvement. Guest messaging, pricing, turnovers, cleaning coordination, and handling issues quickly can feel like a lot, especially if they do not already have a solid co-host or property manager in place.

Chris Rich · Answer

From what I've seen in the Central Florida market, it's a lot more work and the numbers don't justify the additional work. You also have higher startup costs to furnish the property. There is also more wear and tear on the property. It can work, yes. But it it is not nearly as profitable or easy as many people make it seem.

Consider the ADR for a LTR at $2,000 a month, that's $67 a day. Airbnb says 46-48% occupancy is average and 75%+ is a top performer. So if you have an average occupancy rate you need $135 a night to generate the same revenue as the LTR rate, and that's without cleaning costs, repairs, or management fees. I just did a quick search on Airbnb and the out the door costs for 4 nights in Kissimmee ranged from $800 to $1800, with most being around $1,200. So you're having a lot more work to come close to the same amount of revenue as a LTR.

Stacy Raskin · Answer

Short term rentals (STR)s are more work and can be more stress depending on if systems are in place, how many rentals an owner has and what minimum stay requirements for the STR are in place. Also, usually hiring and screening for help such as cleaners is often required if the owner doesn't want to do this work. It's worth considering net profit for a long term rental versus the short term rental when all costs are considered such as cleaning costs etc. Besides net profit, the investor deciding what kind of landlord experience makes sense for his or her personality and goals is important. Also worth considering, if doing the work or hiring a property manager to manage the process can make sense for the local market.

Diego Alvarado · Answer

Starting up, the main constraints are the regulations and as any other investment what it makes sense in terms or many.

STRs are Operation heavy do you should need to hire someone if you don't have the time.

When hiring someone the most important point is to cash flow. After the investment you will look to get your money back as soon as possible.

LTR.even though it is not passive, it is easy to self-manage.

STR requires starting costs and time similar than any other business idea that you would like to launch.

David Krulac · Answer

I like the less work of LTR, where tenants stay very long terms (up to 30 years, not 3 days), take care of all utilities, bring their own furniture and appliances, mow the lawn and shovel the snow.

If you haven’t opened a short-term rental, what is holding you back?

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