Serviced accommodation can generate significantly more income than long-term letting, but it requires different management. Here's everything you need to know.
Serviced accommodation — providing short-term, furnished accommodation typically through platforms like Airbnb and Booking.com — has become a mainstream income strategy for UK property investors. This comprehensive guide covers everything from whether your property is suitable to how to maximise occupancy and profitability.
What is serviced accommodation?
Serviced accommodation refers to furnished properties let on a short-term basis (typically nights to weeks) with hotel-like amenities: professional-grade linens, a cleaned and prepared property for each guest, and usually wifi, a fully-equipped kitchen and customer service support. Unlike traditional B&Bs or hotels, guests have a self-contained property to themselves.
Is your property suitable?
Not every property is well-suited to serviced accommodation. The key factors that determine success are: location (proximity to employers, hospitals, tourist attractions, transport hubs); property type (compact, well-specified apartments or houses work best); and your ability or willingness to manage the operational requirements or appoint a professional operator.
Properties near major NHS trusts, research parks, universities, Gatwick Airport or London corporate districts can achieve exceptional occupancy from contract workers, relocating families and business travellers year-round. Tourist-focused locations are more seasonal.
The income potential
A two-bedroom flat that achieves £1,300 per month on a long-term let might achieve £90-£150 per night on Airbnb at 75% occupancy — producing £2,000-£3,000 per month. Even after cleaning costs (£50-£100 per turnover), platform fees (15-20%), consumables and higher utility costs, many properties net significantly more than on long-term lets.
The key variable is occupancy. At 50% occupancy, many properties barely break even after costs. At 80%+, the economics are compelling.
Regulatory considerations
In London, short-term lets are restricted to 90 days per year without planning permission under the Deregulation Act 2015. Outside London, planning restrictions vary — check with your local authority. The government has proposed a national registration scheme for short-term lets.
Some leases contain clauses prohibiting short-term subletting. Always check your lease and mortgage terms before operating serviced accommodation.
Operational requirements
Serviced accommodation requires intensive operational management: responding to guest enquiries within hours, managing bookings across multiple platforms, coordinating professional cleaning between each stay, maintaining high review scores, handling maintenance issues quickly, and managing guest access (typically through smart locks or key safes).
Most investors cannot handle this operationally alongside a full-time job. Professional management by an experienced operator is essential for most landlords to make serviced accommodation viable.
Our serviced accommodation management
Arete Lettings provides full serviced accommodation management for suitable properties in our operating areas. We handle platform management, guest communications, cleaning coordination, pricing strategy and all operational requirements. Our service enables landlords to benefit from serviced accommodation income without any operational involvement.
Contact us on 01268 944120 to discuss whether your property is suitable and what we could achieve for you.