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D2
Airbnb vs Long-Term Let vs Serviced Accommodation
Three operating models, three tax regimes, three risk profiles. Pick the right one for your property and time.
Compare your options
Airbnb / short-let
Pros
- Higher gross yield in tourist areas
- Flexibility to use yourself
- No AST eviction risk
Cons
- High turnover costs
- 90-day rule in London
- Planning permission risk
- Income tax on full profit
Best for: Holiday locations with strong year-round demand and active hosting.
Long-term let (AST)
Pros
- Stable income
- Low management overhead
- Mortgage products plentiful
Cons
- Renters' Rights Act limits flexibility
- Section 24 hits higher-rate landlords
- Longer void costs
Best for: Most landlords. The default, lowest-risk model.
Serviced accommodation
Pros
- Higher yields than AST
- VAT registration unlocks input VAT
- Corporate tenant base possible
Cons
- Operationally intensive
- Mortgage availability limited
- Planning + licensing in some councils
Best for: City-centre 1–2 beds near hospitals, business districts, transport hubs.
Worked scenarios
Coastal cottage, 6-month season
| Option | Outcome |
|---|---|
| Airbnb | Likely highest income but variable; high-touch operation. |
| Long-term let | Lower income but predictable; low operational load. |
| SA | Usually weak fit — relies on year-round corporate demand. |
City 2-bed near hospital
| Option | Outcome |
|---|---|
| Airbnb | Strong if tourist or event demand exists. |
| Long-term let | Solid baseline; mortgage friendly. |
| SA | Often the highest net — corporate weekly stays. |
London 1-bed (Greater London)
| Option | Outcome |
|---|---|
| Airbnb | 90-day cap forces hybrid model or planning application. |
| Long-term let | Default — yields low but rent strong. |
| SA | Possible if the property qualifies under planning use class. |
Decision checklist
- Check council planning rules for short-lets / SA.
- Check leasehold restrictions if applicable.
- Model gross income with realistic occupancy (don't trust agency forecasts).
- Add cleaning, linen, platform fees, council tax, utilities.
- Check mortgage permits the use case.
- Consider FHL changes (FHL regime abolished April 2025).
Relevant tools
Related guides
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