Airbnb or a long lease: which nets more?

A nightly rate looks big next to a monthly rent until cleaning, platform fees, empty winter weeks and SARS come off it. This compares Airbnb against a long lease on what you actually keep for the year.

The model runs a year of short letting at your nightly rate and occupancy, strips out the costs that scale with bookings and the fixed monthly ones, taxes the profit, and lines the result up against the same property on a long lease with its own vacancy and management assumptions. Both sides land on one comparable number: net in your pocket for the year.

Occupancy decides everything. The same flat at 60% full can comfortably beat a lease, and at 35% often loses to it. So the break-even occupancy card is the figure to watch, with your assumed occupancy sitting next to it, and the gap between them is your margin for a bad season.

Gather:

  • the average nightly rate, annual occupancy, typical stay length and cleaning cost per stay
  • the platform and management percentages
  • levies, rates, utilities and other monthly running costs
  • the long-let rent, expected vacancy and any management fee
  • your taxable income, and the property value so both paths can be read as a yield

One local rule is built in. Cape Town's 2026/27 Rates Policy, adopted on 29 June 2026, rates a property as commercial accommodation when it is listed for short letting more than half its annual room nights, with billing from 1 July 2027. The rate-in-the-rand is 2.41 times the residential one, and the same test strips the R620,000 residential relief, so a typical R2m home pays about three and a half times its current bill. The calculator works that out from the rates bill you enter. The rates tariff toggle lets you stress-test the outcome or leave it residential for occasional letting of your own home.

The city presets are vendor estimates, not booking promises, so edit them. And the model can't price your own time. Self-managing a short let is a real job, and it doesn't appear anywhere in the arithmetic.

Money Cat is an information tool, not financial advice. Confirm any figure that matters with your bank, lender or a registered professional.