A short term rental is a furnished home or room rented for brief stays, usually under about 30 days, though your city's code sets the real definition. Dallas, San Bernardino County and New York City all draw the line near 30 days. Compare the same property as a short term and a long term rental below.
Short term vs long term rental calculator
Enter one property both ways. The tool shows net income for each, the occupancy where they tie, and return on the cash you put in. It also shows what the management fee does to the answer.
Short term vs long term rental calculator
As a short term rental
As a long term rental
The same property either way
On these numbers the long term rental nets $5,281 more a year before income tax. Check the result against your own market data and advisor.
Side by side, per year
| Line | Short term | Long term |
|---|---|---|
| Revenue | $55,520 | $25,502 |
| Platform fees | $8,606 | $0 |
| Management | $13,880 | $2,168 |
| Cleaning | $8,380 | $0 |
| Operating and property costs | $14,600 | $8,000 |
| Net before loan | $10,054 | $15,335 |
| Cash flow after loan | -$3,946 | $1,335 |
| Cash invested | $100,000 | $86,000 |
| Return on cash | -3.9% | 1.6% |
Short term net by occupancy and management fee
| Occupancy | You manage | 10% fee | 25% fee |
|---|---|---|---|
| 40% | $12,253 | $8,384 | $2,581 |
| 50% | $18,966 | $14,130 | $6,876 |
| 57.4% | $23,934 | $18,382 | $10,054 |
| 65% | $29,036 | $22,749 | $13,318 |
| 75% | $35,749 | $28,495 | $17,614 |
Shaded cells beat your long term net. The "You manage" column counts your own time as free, and it is not.
Average stay of 7 days or less: under 26 CFR 1.469-1T(e)(3)(ii)(A), the activity is not a rental activity for the passive loss rules. Ask your tax advisor what that means for you.
Runs in your browser. Nothing is stored or sent. Before income tax. Sourced defaults: 57.4% occupancy is AirDNA's 2026 US forecast, as reported in July 2026; 15.5% is Airbnb's fee for most hosts; 25% is the low end of the full-service range on Evolve's fee guide; 7.6% is the Census Q3 2026 rental vacancy rate. All other defaults are editable assumptions, not market data. This compares numbers and is not investment or tax advice.
Key takeaways
- There is no single US definition. Local codes commonly use a line near 30 days, and federal tax rules use separate tests for specific purposes.
- In the example, the short term rental nets 10,054 dollars a year with a 25 percent manager, and the long term rental nets 15,335 dollars.
- Those numbers tie at 69.7 percent occupancy. Without the manager, the tie falls to 44.6 percent, and you take on the work.
- AirDNA forecast 57.4 percent US occupancy for 2026, as reported in July 2026. Your block may differ.
| Source | The line | Note |
|---|---|---|
| City of Dallas | Fewer than 30 consecutive days or one month, whichever is less | City page says a December 2023 temporary injunction blocks enforcement of its two ordinances |
| San Bernardino County | Transient occupancy, generally 30 consecutive calendar days or less | Covers a dwelling or part of one |
| New York City | Whole units cannot be rented for under 30 days | Host must stay in the unit, at most 2 paying guests. Registration law exempts 30 or more days |
| 26 CFR 1.469-1T(e)(3)(ii) | Average customer use of 7 days or less, or 30 days or less with significant personal services | Tests for the passive loss rules |
| IRS Topic 415 | Used as a residence and rented fewer than 15 days | Do not report the rent or deduct rental expenses |
What is a short term rental?
A short term rental is a home, apartment or room rented to guests for days or weeks instead of on a lease of months or years. It is usually furnished, with utilities included, and is often booked through Airbnb or Vrbo. Whether yours legally counts as one depends on the code where the property sits.
The table shows how much that varies. A 30 night stay is short term under San Bernardino County's general wording, and outside the definition in Dallas. New York City exempts stays of 30 consecutive days or more from registration. So search for your own city's page before you rely on a blog, including this one. Stays of a month or more are often sold as mid-term rentals, which is a market label and not a legal one.
Rules matter more than the definition. In New York City, hosts must register, and platforms cannot process bookings for unregistered rentals. If you plan to rent a place you do not own, read the rental arbitrage guide, since landlord consent is its own hurdle.
Short term rental vs long term rental
A short term rental earns more per night and costs more to run. A long term rental earns less per month with far fewer costs and far less work. The fair comparison is net income for the same property. On the calculator's example, a 25 percent manager decides the result, and self-managing reverses it.
| Short term occupancy | With 25% manager | You manage |
|---|---|---|
| 50% | $6,876 | $18,966 |
| 57.4% (AirDNA 2026 forecast) | $10,054 | $23,934 |
| 65% | $13,318 | $29,036 |
| 75% | $17,614 | $35,749 |
Here is the formula in plain words. Short term net is nightly revenue plus cleaning fees, minus platform and management fees, cleaning, operating costs and property costs. Long term net is rent after vacancy, minus management and property costs. Break-even occupancy is the point where those two match.
The vacancy default is the Census Bureau's 7.6 percent national rate for the third quarter of 2026. The occupancy default is AirDNA's 57.4 percent forecast, as reported by Short Term Rentalz. Both are national, and neither knows your street. A national average will not tell you whether a ski town in April books any nights at all.
What is a good ROI on vacation rental property?
We could not trace a published standard for a good ROI on vacation rental property, so distrust any single figure without a named source. The useful test is relative: return on cash against the same property as a long term rental, against a lower-risk alternative, and against your cost of borrowing. Your advisor can weigh those for your situation.
Return on cash is yearly cash flow after loan payments, divided by the cash you put in. In the example, the short term rental returns negative 3.9 percent on 100,000 dollars, a loss of 3,946 dollars a year. The long term rental returns 1.6 percent on 86,000 dollars. Neither counts appreciation or tax effects. The Freddie Mac 30-year average was 7.24 percent on October 29, 2026, which is why loan payments can eat the whole result. For the income side alone, see what a good cap rate is.
Vacation rental management fees and platform fees
Vacation rental management fees are usually a percentage of booking revenue, and they vary by how much the manager does. Evolve's guide, read November 2026, puts traditional full-service managers at 25 to 35 percent. Evolve itself starts at 10 percent on a hybrid plan, without the on-site work a full-service manager does. Compare what is included as well as the rate.
- Airbnb. Its help center says most hosts on the single-fee structure pay 15.5 percent, read November 2026.
- Vrbo. Its pay-per-booking page lists a 12 percent commission on rent and fees you charge, with higher rates possible in some regions, read November 2026.
- Long term management. The 8.5 percent default is an assumption. Check it against quotes from managers in your market.
How the IRS and your insurer treat short term rentals
The federal rules we read set no single definition of a short term rental. Instead, they apply separate tests for separate purposes: how long you rented it, how you used it, how long guests stayed and what services you provide. These were read in November 2026. Take your own facts to a tax advisor, because the answer changes what you can deduct.
Fewer than 15 days
IRS Topic 415 says that if you use a dwelling as a residence and rent it for fewer than 15 days, you do not report the rent and do not deduct rental expenses. That rule is in 26 U.S.C. 280A(g). You count as using it as a residence when personal days exceed the greater of 14 days or 10 percent of the days rented at a fair price.
Seven days, 30 days and services
The passive activity regulation says an activity is not a rental activity if the average period of customer use is seven days or less. The same goes for 30 days or less when significant personal services are provided. Separately, Publication 527 says Schedule C is generally used when you provide substantial services with the property. Cleaning of public areas and trash collection do not count as substantial services there.
Insurance
The Insurance Information Institute said in March 2026 that standard homeowners insurance typically does not cover commercial activities, including short term renting. It advises telling your insurance professional and considering specialized coverage. Get the answer in writing, and put the price in the calculator's yearly extras line.
Where the phone fits, and where it does not
If one property books only through a platform's app, you probably do not need a phone answering service. Most guests will message you there. The phone matters once you run direct bookings, which you may want when the platform fee is the largest line in your side-by-side table. A family asking about Thanksgiving will not wait until Monday.
callflo.ai answers those calls 24/7 from the house guide you give it, captures the lead and texts the caller. On VIP it can also take a deposit by card during the call. Starter is 39 dollars a month on annual billing, or 49 dollars month to month, with 120 minutes and extra minutes at 0.98 dollars. The AI receptionist for vacation rentals post covers the calls in detail, the page for investors shows the setup, and the pricing page has both plans.
Hear what answers your direct-booking line
Call callflo.ai's own AI agent and ask it anything about your business. When you are ready, pick a plan: no setup fee, no contract, and you do not pay unless you are satisfied.
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