How big does my apartment need to be before it can be rented out?

The size of the apartment alone does not decide success with short-term rental. In the end, location, the quality of the listing, facilities, pricing and professional management matter more than square metres.

With the right set-up and support, such as BY Administration, any well-located apartment can generate strong and steady rental income!

Does the size of the property affect short-term rental income?

When property owners consider renting out their apartment short-term, one question comes up again and again: does a bigger apartment lead to more bookings and higher income? It is an understandable assumption. Larger homes can fit more guests and often charge higher prices per night, so it seems logical that they would deliver better results.

In reality, the answer is more nuanced. The size of the apartment is not a precondition for success with short-term rental; it is an opportunity. Different travellers look for different types of accommodation depending on their needs, their budget and the purpose of their trip.

A couple visiting a city for a weekend may prefer a cosy, well-located studio, while a family or a group of colleagues travelling together may be looking specifically for a spacious apartment with several bedrooms. Because demand varies, both small studios and large family homes can do very well when they are presented and managed properly.

In the end, factors such as occupancy rate, target group, pricing strategy and professional management play just as important a role as square metres. Understanding how these elements work together is the key to getting the most out of your property. So how much does the size of the apartment really affect rental results? Let us take a closer look.

It is easy to assume that larger apartments automatically get more bookings, but in reality, rental demand is driven more by the type of guest than by square metres. Short-term rental platforms bring together many different types of travellers, all with their own needs, budgets and preferences.

Some guests are looking for a compact, practical place to sleep, while others want enough space for several people to stay together comfortably. Because of this variety, it is mainly the size of your home that decides which type of traveller your listing attracts.

For example, smaller apartments and studios are particularly attractive to:

• Solo travellers
• Couples on weekend trips
• Digital nomads
• Business travellers
• Commuters who need a flexible place to stay

These guests often put location, convenience and price ahead of extra space.

Larger apartments, on the other hand, typically attract:

• Families travelling together
• Groups of friends
• Business teams or colleagues
• Guests planning longer stays

For these travellers, having several bedrooms and shared living space can be a big advantage.

The conclusion is simple: there is a market for every size of apartment. Success does not depend on having the biggest property, but on positioning your apartment for the right audience and highlighting the features that matter most to them.

Looking for professional advice on how to maximise your rental income? Contact the BY Administration team today.

Why studios often have higher occupancy

Demand for compact accommodation

Studios may be small, but they often do surprisingly well in the short-term rental market. One of the main reasons is simple: they are within reach of a wider range of travellers. With a lower price per night than larger properties, studios attract guests who want comfortable accommodation without paying for extra space they do not necessarily need.

Many travellers are looking for a practical place to stay rather than a large home. For weekend guests, business travellers or people on short city breaks, a well-furnished studio can be the perfect base. It offers everything they need: comfort, functionality and a convenient location without unnecessary square metres.

As a result, studios often attract a steady stream of guests, such as:

• Weekend guests
• People visiting the city for short stays
• Business travellers
• Guests who often make short stays during the year

The advantage of frequent bookings

As studios are well suited to short visits, they often benefit from a higher booking frequency. Guests typically stay a few nights rather than a whole week, which creates more turnover and more opportunities for new bookings.

In many markets, this leads to steady demand throughout the year. Even if a studio costs less per night than a larger apartment, this can often be made up for by more frequent bookings and higher occupancy.

“Less is more” from an investment perspective

From an investment perspective, smaller apartments can also be very attractive. They usually cost less to maintain, furnish and run, and their compact layout makes them easier to standardise across several properties.

Studios also tend to have lower purchase prices, which can make them more accessible to investors. It can also be easier to scale a rental portfolio when you own several smaller units, while keeping the operational complexity at a manageable level. For many property owners, this combination of steady demand, lower costs and strong return potential shows that when it comes to short-term rental, less really is sometimes more.

Why larger apartments still do well

While studios often benefit from frequent bookings, larger apartments also do very well in the short-term rental market. In fact, they fill an important niche for travellers who specifically need more space and prefer to stay together rather than book several hotel rooms.

Group travel is on the rise

Many trips today involve more than just one or two people. Larger apartments are particularly attractive to:

• Families travelling together
• Groups of friends on city breaks
• Company teams attending meetings or events
• Visitors attending festivals, conferences or special events

For these groups, having everyone under the same roof is often both more practical and more pleasant than being spread across several hotel rooms.

Higher prices per night

One of the biggest advantages of larger apartments is that they can fit more guests comfortably. Features such as several bedrooms, shared living rooms and extra amenities make them particularly attractive for group travel. Because of this added value, larger properties can usually charge considerably higher prices per night. They also often attract longer stays, especially when families or groups visit for several days.

Size becomes a selling point

In competitive rental markets, space itself can become a strong selling point. Larger apartments often stand out from smaller listings, attract bookings at higher prices and give groups a better overall experience.

As a result, larger apartments may be booked a little less often than studios, but each booking can generate considerably higher income, which makes them a strong player in the short-term rental market.

This type of guest books more often, often stays for a shorter time and puts price, functionality and accessibility ahead of space. This creates a higher turnover rate and can result in more stable occupancy over the year. At the same time, the lower entry price means the home is relevant to a larger market, which reduces empty periods and makes earnings more predictable.

From an investment and return perspective, smaller units can therefore be particularly attractive. They are often easier to optimise, easier to standardise and cheaper to maintain, while they can be scaled in number. When furnishing, pricing and marketing are closely tailored to the target group, “less is more” becomes not just another aesthetic philosophy, but a tangible business advantage.

Check your property’s income potential with BY Administration’s calculator here.

Other factors that affect how often you are booked

The size of the apartment can affect the type of guests you attract, but it is only part of the overall picture. In reality, several other factors often play an even bigger role in how often a property is booked. Understanding them can make a significant difference to your rental performance.

Location

Location is often the most important factor when travellers choose where to stay. Guests typically put convenience and accessibility ahead of extra space. Apartments in attractive areas naturally get more attention and more bookings.

Properties often do best when they are close to:

• City centres
• Business districts
• Public transport hubs
• Popular tourist attractions

A well-located studio can sometimes outperform a larger property in a less attractive area, simply because it brings guests closer to where they want to be.

Furnishing and functionality

Guests also look for properties that feel comfortable, practical and well kept. A clean, thoughtfully furnished apartment makes a much better first impression and leads to better reviews.

Even smaller apartments can do very well when:

• The space is used efficiently
• The furniture is practical and comfortable
• Storage solutions keep the apartment organised

A well-designed layout can make a compact apartment feel far more spacious and inviting.

Amenities and guest experience

Today’s travellers also expect certain amenities that make their stay easier and more pleasant. Some of the most important are:

• Fast and reliable Wi-Fi
• A fully equipped kitchen
• Comfortable beds
• Simple and convenient self check-in

These small details can improve the overall guest experience considerably and encourage positive reviews.

The quality of the listing

Finally, the way your home is presented online plays a decisive role. On platforms such as Airbnb and Booking.com, results depend heavily on the quality of the listing itself. Professional photos, clear descriptions, good guest reviews and competitive prices all help make your home stand out and attract more bookings.

The real key to success: professional property management

Whatever the size of your apartment, the quality of the management plays an important role in how well it does as a short-term rental. A well-managed property can attract more guests, get better reviews and ultimately achieve a higher and more stable income.

Optimised presentation

First impressions matter, especially online. Guests usually decide within seconds whether to click on a listing or keep scrolling. That is why every property should be presented in a way that is inviting, clear and appealing.

A strong listing should:

• Look inviting and well kept
• Highlight the property’s best features
• Include professional, high-quality photos

Even a compact studio can seem exclusive when it is presented properly. Good photos, thoughtful staging and a clear description can make a big difference to how guests see the space.

Complete operational service

Successful short-term rentals also depend on smooth day-to-day operations. Professional management typically handles all the practical details that make sure guests have a pleasant stay.

This often includes:

• Cleaning between guest stays
• Changing to fresh bed linen and towels
• Communicating with guests before and during their stay
• Consistent support with questions or problems
• Handling maintenance when needed

When these elements are handled consistently and professionally, guests get a better experience. This leads to better reviews, repeat bookings and higher occupancy over time.

Strategic pricing

Pricing is another important factor. Instead of setting a fixed price per night, successful properties use a more flexible approach. Prices should reflect current market demand, seasonal swings, local events and the property’s unique features.

Dynamic pricing helps make sure your apartment stays competitive while its income potential is maximised.

There is no “perfect” apartment size for short-term rental

When it comes to short-term rental, there is no single apartment size that guarantees success. Both small and large properties can work really well; it simply depends on how they are positioned and managed.

Studios, for example, often generate steady income through frequent bookings. Their lower price per night makes them attractive to a wide range of travellers, including business guests, couples and solo visitors. As these guests often stay for shorter periods, studios can benefit from a steady stream of bookings throughout the year.

Larger apartments, on the other hand, typically earn more per stay. With more bedrooms and more space for groups, they attract families, friends travelling together and business teams. These properties may be booked a little less often than studios, but each booking usually generates higher income.

In the end, success with short-term rental depends on a few key factors:

• Targeting the right audience
• Creating a high-quality, appealing listing
• Using smart, strategic pricing
• Making sure there is professional day-to-day management

A well-managed studio can become a reliable and steady source of income, while a spacious family home can generate strong long-term returns.

At BY Administration, we help property owners realise the full potential of their apartments, whatever their size. From professional presentation and guest management to dynamic pricing and marketing, our team handles the practical details so you can enjoy the financial benefits. The most important step is not owning the “perfect” apartment. It is getting the most out of the property you already have!

Sources

Data collected internally from BY Administration’s rental portfolio.