Short term rentals through Airbnb's platform - the basics you need to know.
In recent months, it is possible to hear and read much about short-term rent of property, generally by means of electronic platforms (where the most known is the Airbnb platform). More and more house owners are focused on acceptance of this method, pushing the prices up. In some regions, prices rose so much that it led, in some cases, to the inability of many Greeks to rent.
The option of short-term rentals began to be chosen by property owners in relatively poor areas, where it was difficult for them to find tenants, or in tourist areas for property that they did not use or used for several days a year.
Obviously, this choice has worked positively, as these platforms have the advantage of bringing owners and prospective tenants more directly into contact, comparing with other traditional methods. In addition, the prospective tenant can find what he/she wants at a better price than the most economical hotels can offer.
This subject has affected also owners of the properties in relatively good and attractive areas where the properties were already under great demand and as a sequence it pushed the prices further high. Already many other European countries facing this issue and have been trying for a long time to deal with it effectively.
However, before choosing option of short-term rent, it is very important to consider some expenses to understand in figures whether there will be this decision eventually profitable or unprofitable, despite the fact that since 2014 the Unified Property Tax (ΕΝΦΙΑ) has begun to apply in Greece, so that it is not in the interest of anyone to keep his property untapped. But is it always a good choice such (Airbnb) option?
Possibly the main cost is the commission paid on the electronic platform with each lease agreement and is usually based on a percentage of the agreed price. This percent can vary depending on the electronic platform (there is not only the Airbnb platform; it is simply the most widespread).
Many owners of the properties are also not familiar with using of the Internet, giving the management of the property on the electronic platform to other persons, generally agents. These owners will also have to calculate a commission fee at the cost of all process. They should also consider the cost of uploading the property data and the reservation to the relevant site of the Independent Authority for Public Revenue (IAPR) from an accountant - a tax consultant or a third party.
Other owners, either due to the significant distance of their permanent residence from the rented property or for other reasons, are unable to maintain the rented property on their own and pay the related costs to third parties (eg for cleanliness). Finally, there are also the necessary operating costs of the property (electricity, water, etc.).
The rent is assessed with a tax of 15% for annual rent income up to 12,000 Euros and 35% over 12,000 Euros. Taxation is based on the agreed price of all bookings in a calendar year, not deducting the costs mentioned above, which should be taken seriously into account when calculating.
Taking all above in consideration, the interested owners need to estimate the choice concerning short-term rent.
A traditional renting offers fixed and specific income each month, without any particular bureaucratic procedure. The option of short-term offers monthly income depending on the number of bookings and conceals an increased cost for its realization.
Of course, if to assume that the maximum number of days of reservation will be reached every month, it will give a greater benefit than a traditional rent, but to achieve this, it is quite difficult for many property owners. But how easy is for someone, to combine all the parameters to effectively determine the number of actual days of rental per month and how realistic would it be to rely on this scenario?
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ATTENTION! This article intends to give only a general informative picture and should not, in any case, be taken as a rule. It is strongly recommended to seek a full and professional guidance specifically for your circumstances before making any decisions.