Comparing Short-Term and Long-Term Rental Yields in Cyprus in 2025

The rental property market in Cyprus continues to evolve, and more investors are now weighing the pros and cons of short-term vs. long-term rentals. The difference in potential returns can be substantial, especially depending on the property type and location.

Short-term rentals (for example, through Airbnb or Booking.com) in tourist areas of the island generate a gross yield of around 6–8%, and with high occupancy rates, total annual returns can reach 10% or more. The main advantage lies in seasonal demand: during summer and holiday periods, rental income can multiply several times. However, this format requires active management - regular cleaning, guest turnover, marketing, and booking administration. Moreover, income tends to drop during the off-season.

Long-term rentals, on the other hand, offer stability and predictability. The average yield is around 4–6% per year. This option suits investors who prefer a steady, passive income without the need for constant involvement. While rental rates are lower compared to short-term leases, maintenance and management costs are minimal.

Geographically, there is a clear division: short-term rentals are more profitable in Limassol, Paphos, and Ayia Napa, where the flow of tourists is strong, while long-term rentals are better suited for Nicosia and other business-oriented areas, where demand remains stable throughout the year.

In general, short-term rentals can yield 2–4% more annually, but they require more time, attention, and operational expenses. Taxation and operating costs affect both models equally, though short-term rentals may be subject to additional tourism-related levies.

The choice between the two formats ultimately depends on your investment strategy. If your goal is to maximize returns and you’re ready for a more hands-on approach, short-term rentals are the way to go. If you prefer stability and lower risk, long-term rentals are the more reliable solution.

The experts at Cyprus Realty Center will help you calculate your potential returns, select the right property, and develop a tailored rental strategy that aligns with your investment goals.