Short-term rentals in Cambridge can be highly lucrative, with high demand from tourists, business travelers, and visiting academics. However, running a successful Airbnb or serviced apartment isn’t just about collecting rental income—it also comes with various costs. Understanding these expenses is crucial for landlords before entering the market, ensuring profitability and avoiding unexpected financial burdens. This guide outlines all the key costs associated with short-term rental management in Cambridge, helping landlords make informed decisions.
Fixed Costs
Mortgage or Rent
For landlords who still have a mortgage, monthly repayments remain a primary expense. If leasing a property to sublet as an Airbnb, rental payments to the landlord are another fixed cost.
Council Tax and Licensing Fees
Cambridge landlords must factor in council tax, which varies based on property size and location. Additionally, some properties may require a short-term rental license, depending on evolving local regulations.
Insurance
Standard home insurance is insufficient for short-term rentals. Specialized landlord insurance, including public liability coverage and protection against property damage by guests, is essential to mitigate risks.
Variable Costs
Utilities
Unlike long-term rentals, where tenants cover utility bills, short-term rental owners must pay for electricity, gas, water, and WiFi. High-speed internet is non-negotiable, as guests expect seamless connectivity.
Cleaning and Maintenance
Frequent guest turnovers require regular professional cleaning services, which can cost between £40-£90 per clean, depending on property size. Routine maintenance, such as plumbing or electrical repairs, also adds to expenses.
Furnishing and Restocking Essentials
A well-furnished property attracts more bookings. Costs include furniture, appliances, linens, and decor. Consumables like toiletries, coffee, and kitchen essentials must also be replenished regularly.
Operational Costs
Airbnb Service Fees and Platform Commissions
Airbnb charges hosts a 3% service fee per booking, while other platforms like Booking.com may take 15% or more. Factoring in these commissions is crucial for pricing strategies.
Property Management Fees
For landlords who prefer a hands-off approach, professional property management services—like Cambridge Stays—offer full-service solutions. Fees typically range from 10-20% of monthly revenue, covering guest communication, cleaning coordination, and maintenance.
Marketing and Advertising
To maximize occupancy rates, landlords should invest in professional photography, listing optimization, and direct booking websites with strong SEO strategies. Targeted online advertising, such as Google Ads and social media promotions, can also boost visibility.
Unexpected Costs
Emergency Repairs
From broken boilers to appliance failures, urgent repairs can arise at any time. Setting aside a contingency fund prevents financial strain.
Wear and Tear on Furnishings
Frequent guest stays lead to faster wear on furniture, requiring periodic replacements or refurbishments.
Legal Compliance
Ensuring compliance with fire safety regulations, gas safety certificates, and planning permissions is non-negotiable. Ignoring legal requirements can result in hefty fines or operational shutdowns.
Managing a short-term rental in Cambridge requires careful financial planning. While self-management may seem cost-effective initially, the time commitment and unexpected expenses can add up. Working with a professional property management company like Cambridge Stays ensures streamlined operations, higher occupancy rates, and maximized profitability—all while saving landlords valuable time and effort.
If you're a Cambridge property owner looking for hassle-free Airbnb or long-term rental management, contact Cambridge Stays today for expert solutions tailored to your needs.
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