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Long-Term vs Short-Term Rentals in Israel: Which Option is Right to Rent Out Your Property?

Updated: May 7, 2023


Property Rental Israel


If you own a property in Israel and are considering renting it out, you may be wondering whether to rent it out on a long-term or short-term basis. There are pros and cons to both options, and the decision ultimately depends on your individual goals and circumstances. In this blog post, we'll discuss the benefits of both long-term and short-term rentals in Israel, and help you make an informed decision.


Long-Term Rentals


Long-term rentals typically refer to leases that last for a period of 6 months or more. Here are some of the benefits of renting out your property in Israel on a long-term basis:


1. Stability: Long-term rentals provide a stable and predictable source of income. You can rely on a steady stream of rental income for the duration of the lease, which can be beneficial if you have ongoing expenses related to the property.


2. Reduced Turnover: With a long-term rental, you'll have fewer turnovers, meaning less time and money spent on cleaning and repairs.


3. Lower Maintenance Costs: Long-term tenants are more likely to treat the property with care, meaning you'll have fewer maintenance and repair costs than with short-term rentals.


4. Reduced property charges: Long-term rentals include payments by the tenant of building management charges ("Vaad Bayt") and also municipal taxes ("Arnona").


Short-Term Rentals


Short-term rentals refer to rentals that last for a few days or weeks, and are popular among tourists and business travelers. Here are some of the benefits of renting out your property in Israel on a short-term basis:


1. Higher Rental Rates: Short-term rentals often command higher rental rates than long-term rentals, especially during peak season (ie summer, Passover and Sukkot holidays).


2. Flexibility: Short-term rentals provide you with the flexibility to use the property yourself during times when it's not rented out.


3. Lower Risk: With short-term rentals, there is less risk of non-payments, as every stay is paid upfront.


Location is going to be an important factor in your decision. Touristic cities such as Tel Aviv, Herzliya Pituach, Eilat and Jerusalem are more suitable for short-term rentals; the regular inflow of tourists and business travelers ensures a good occupancy rate throughout the year. On the other hand, if your property is in a city like Ramat Aviv, Raanana, Netania or Bat Yam, a long-term rental is probably the best option to maximize your income.


Conclusion


Ultimately, the decision to rent out your property in Israel on a long-term or short-term basis depends on personal goals. If you're looking for stability and lower maintenance costs, long-term rentals may be the better option. If you're looking for higher rental rates and would like to keep enjoying your property, short-term rentals may be the way to go.

Whatever you decide, make sure you research the local rental market and work with a reputable property management company, such as ID Real Estate to ensure a successful rental experience.

Contact us for more information.

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