Serviced accommodation investment: A smart strategy for property owners
As the short-term rental market continues to evolve, more landlords are considering serviced accommodation investment as a flexible and potentially lucrative alternative to traditional lets. With growing traveller demand for high-quality, fully furnished spaces that combine the comfort of home with the convenience of a hotel, serviced apartments are an increasingly attractive asset class.
What is serviced accommodation?
Serviced accommodation refers to fully furnished properties available for short or medium-term stays. They provide hotel-like amenities such as cleaning services, included utilities, and concierge support. These properties cater to business travellers, tourists, and relocating professionals looking for a home-from-home experience.
In contrast, non serviced accommodation typically includes long-term rentals where tenants are responsible for their own cleaning, utility bills, and maintenance. While both models cater to specific lifestyles, serviced accommodation generally yields higher returns and offers landlords greater flexibility.
Why invest in serviced accommodation?
Higher income potential
Many landlords ask, “How much profit should I earn on a rent-to-serviced accommodation (R2SA)?”. While it varies, net yields are often considerably higher than traditional lets. Profitability can be maximised by:
- Using dynamic pricing to match market demand
- Listing across multiple platforms
- Offering optional services like early check-ins or premium welcome packages
Flexible usage
Serviced accommodation gives landlords the option to block out time for personal use or adapt availability around seasonal trends. This flexibility is ideal for second homes or properties in tourist areas.
Appealing to corporate clients
Business serviced apartments attract longer, more predictable bookings from companies. Offering features like workstations, high-speed Wi-Fi, and central locations enhances appeal to this audience.
Key considerations for investors
Insurance
Standard landlord policies aren’t suitable. Instead, serviced accommodation insurance should cover:
- Guest stays
- Public liability
- Accidental damage
- Loss of income due to cancellations or property damage
Management
Landlords can choose between full-service management or hybrid options. Partnering with experts such as GuestReady ensures:
- Professional guest communication
- Housekeeping and maintenance
- Pricing optimisation using data-driven tools
Legal and regulatory compliance
Regulations vary. Key areas to address include:
- Planning permissions
- Health and safety standards
- Short-let licensing
Non-compliance can result in fines, so staying informed and supported is essential.
Serviced vs non serviced accommodation
Serviced accommodation typically supports short to mid-term stays and includes full guest amenities, such as cleaning and maintenance, often yielding variable yet higher returns. It usually requires moderate to high involvement from landlords unless management is outsourced. On the other hand, non serviced accommodation is intended for long-term tenants who manage their own utilities and upkeep. While it generally offers stable but lower yields, it demands minimal input from landlords.
Here’s how they compare:
| Feature | Serviced Accommodation | Non Serviced Accommodation |
|---|---|---|
| Stay length | Short to mid-term | Long-term |
| Guest support | Full amenities and services | Tenant-managed |
| Income potential | Variable, high yield | Stable, lower yield |
| Landlord involvement | Moderate to high | Low |
Unique interior design, standout locations, and excellent guest reviews are key performance drivers.
Launching a serviced accommodation business
To build a strong foundation:
- Research your market: Understand demand, competitors, and optimal price points.
- Prepare the property: Furnish tastefully, ensure legal compliance, and prioritise guest comfort.
- List smartly: Use compelling copy, professional photos, and relevant keywords.
- Deliver service: Provide smooth check-ins, timely communication, and added touches.
- Manage efficiently: Automate where possible and monitor performance metrics.
Related read
Want to improve your profitability? Read our guide on how to increase serviced accommodation income
Future trends and opportunities
The industry is advancing rapidly:
- Smart technology: Enables contactless entry, automated messaging, and operational efficiency.
- Sustainability: Guests are seeking eco-friendly practices.
- Hybrid living: Demand is growing from digital nomads seeking work-life flexibility.
New opportunities include niche markets like co-living, pet-friendly units, and themed stays.
Final thoughts
Serviced accommodation investment offers landlords a chance to unlock new income streams, build a more resilient property portfolio, and cater to a growing global market.
GuestReady offers comprehensive solutions for landlords entering or scaling in the serviced accommodation sector. From staging and photography to guest communication and performance analytics, we help you run a successful operation without the day-to-day stress.
Fill in our contact form today and let’s help you unlock your property’s full potential.
