How to make money from short-term rentals in Cyprus

High profitability, favorable legislation and high demand for rental housing have turned Cyprus into an investment Mecca. Investing in real estate will protect them from inflation and turn them into a profitable asset. The influx of tourists to the island increases by 10-20% annually, renting apartments on a daily basis is more profitable financially than making money on long-term rent.

Why short-term rent is in demand in Cyprus

The ability to work in many areas remotely allows people to travel and continue working from any corner of the world. Therefore, Cyprus is often chosen by digital teams, business leaders, and wealthy tourists.

Short-term rental housing is the best alternative to a hotel. The tenant feels at home in a Mediterranean country, gets acquainted with the local culture, and can simultaneously retire and remain in society.

He pays for the property per day, and not for the number of residents. Short-term rental is beneficial for family vacations or large companies. You can prepare it yourself, choose a property closer to places of interest – attractions, beaches, festivals.

Which properties generate the most income

High ROI from real estate bring elite apartments on the first line from the sea. Not only premium class housing is valued, but also location in good areas.

In demand:

• fashionable apartments;
• luxury houses;
• villas.

The investment potential of elite properties is high. Income drivers:

• location – housing in prestigious areas of Limassol, Famagusta, Paphos, Larnaca, in elite villages, surrounded by greenery, with a designer landscape and sea view attract tourists;
• infrastructure – proximity to medical institutions, developed transport highways, low crime rate increase demand for properties;
• amenities – the presence of parking, a swimming pool, a gym, several guest rooms and bathrooms have a positive effect on the demand for housing.

Projects of the urban concept “city within a city” are especially popular.

Registration and licenses for renting out property

Since 2020, the Cypriot authorities have obliged owners of real estate renting out their property for short terms to register with the Unified National Housing Register and obtain a license. It is issued for 5 years, the license fee for each property is €222.

You can register online on the official portal of the Ministry of Tourism of Cyprus. The license is issued within a month after submitting an online application. The registration number is indicated in each advertisement for renting a property.

How to find reliable tenants

You shouldn’t focus on one approach to finding tenants, you should use all available methods:

• online ads on thematic Internet platforms – these are social networks, international platforms such as Airbnb, Booking.com, Cypriot Zyprus or Bazaraki.com;
• use the services of Cypriot real estate agencies – they help to select tenants according to the owner’s requirements;
• use property management companies – it is beneficial for foreigners who own property in Cyprus to cooperate with them.

You should choose tenants carefully, otherwise the rent will result in losses.

Marketing and promoting your property

The online article by the Humans of Globe publication describes the transformative trends in the real estate sector, allowing you to get the maximum profit from rent. The main theses of the journalists’ research can be applied to promoting your own property:

• PropTech technology simplifies the rental process;
•  “smart” and eco-friendly houses are at the top of demand;
• the demand for multifunctional housing is growing.

It is important to present rental services competently, create VR tours, take high-quality photos, detailed descriptions of the property and the surrounding environment, and adapt prices to demand.

Calculating profitability and expenses

When calculating the profitability of a property for short-term rent, the following is taken into account:

• purchase price of the property;
• property taxes;
• license cost;
• insurance;
• cleaning;
• downtime;
• current repairs;
• utility costs.

If the property is owned by a non-resident of the country, it is worth adding the costs of servicing by management companies.

Tips for managing properties remotely

It is possible to safely remotely manage property in Cyprus if you cooperate with trust management companies. They resolve current issues with tenants, are responsible for the security of the property and financial reporting, perform building maintenance, and are engaged in short-term rent. This is a sure way to profitably operate real estate, if the owner is unable to be permanently in Cyprus.