21 thousand apartments secured 85 million euros from Airbnb in 2024/ Is it worth renting out your house daily?

2025-02-08 09:20:00, Ekonomi CNA

21 thousand apartments secured 85 million euros from Airbnb in 2024/ Is it worth

About 21 thousand apartments and other residential units were available for rent at the end of 2024. These units generated a record income of 85 million euros, almost twice as high as in 2023. Which cities are the most developed in this business? How much is earned from renting by month and for how many days per month is the apartment occupied?

Albania's return to a favorite tourist destination has also opened up a business opportunity for those who own property, or third parties who manage the assets of others.

Renting out an apartment, or having some of them managed by a third party, is becoming an alternative for generating income for many families or individuals. Although prices continue to remain low, averaging 40-60 euros per day, the total profits generated are increasing year by year.

Data from AirDNA, the analytical unit of the Airbnb rental platform, made available to "Monitor", shows that in 2024, a total of 85 million euros were generated from rentals in Albania, a record level ever recorded in the country. Compared to the previous year, revenues have increased by 85%.

The development is noticeable in the last two years and coincides with the increase in the entry of foreign citizens into the country, which exceeded 10 million in 2023 and 11.7 million in 2024.

With daily rental prices that are cheaper than hotels and the higher number of people that can stay in an apartment, demand for these accommodation units remains high.

Compared to 2021, this market only circulated 14 million euros.

In 4 years, the number of units rented has more than quadrupled. In January 2021, the earliest data available from AirDNA, about 5.3 thousand apartments or other residential units were rented through Airbnb.

In December 2024, this figure reached 21.3 thousand, with the record set in September 2024, at almost 24 thousand. This number represents almost 3% of the total housing units in the country (about 1.08 million) according to INSTAT, or 5.5% of apartments in buildings (432 thousand).

“Home rentals are a growing market,” says Stela Dhami of Colliers International. She adds that as long as there is no intervention in this market, this trend will continue.

"A 'hotel' submarket has been created for family tourists and youth with a low budget, given that the typology of tourists we attract is low cost."

In August 2024, there were 23.5 million daily rentals available nationwide on Airbnb. This is also the peak period for the holiday season. 73% of these units were booked for at least one day during the month, according to AirDNA.

In December, out of 21.3 thousand listed units, only 26% of them were rented for at least one day.

Net stays reach record in August

The boom in tourism has led to a strong increase in overnight stays in structures rented out through the Airbnb platform. A total of 1.28 million overnight stays were recorded through this platform in 2024, with an increase of 70% year-on-year.

The highest number of overnight stays is recorded in August. In the summer of 2024, the demand for overnight stays in the country was almost 4 times higher than in August 2021, reaching 272 thousand, up from 72.7 thousand, about four years earlier.

Is it worth it?!

During the summer months, Suela decided to rent a house in the New Bazaar area of ??the capital, to then rent it out by the day. The monthly rent was 500 euros, while she rented it out by the day, at a price ranging from 35-55 euros.

The apartment was occupied for a maximum of half the month. Other fixed expenses, in addition to the rent, were 150-200 euros per month, such as energy, cleaning, purchasing toiletries, replacing equipment that could become obsolete, etc., as well as the percentages given by Airbnb or Booking, which ranged from 7 to 14%.

The average income was 700-800 euros per month and on the best days in August-September reached 1100 euros per month, with a net profit of 100-400 euros per month, which is considered minimal for such a commitment.

Suela has given up today and says that she would never return to such an adventure again.

This business is more profitable for people who have set up a business and manage several entrances simultaneously, as expenses decrease as more units are rented out, or those who own apartments that they do not use.

AirDNA data shows that the average daily price in Albania for a rental residential unit fluctuates from 43 euros in February to 81 euros in August, including cleaning, but excluding other service costs.

Unlike what has happened in other countries, prices have not seen any significant increases in recent years, except during the summer months in coastal areas, due to high competition, which has come from the increase in listed apartments.

The average of 80 euros in August comes as a result of high prices in coastal units, mainly Vlora and Saranda, which reach 95 euros in August, in Durrës, 85 euros/night, while in Tirana, the average daily rent does not exceed a maximum of 50 euros even at the peak of the season.

Colliers' Stela Dhami claims that the return on daily rent is generally low, due to high competition, but in Albania people don't think too long about the return on investment.

Property owners and others followed the trend, significantly increasing the stock of apartments for daily rent, as the perception arose that this was an easy way to earn income.

This trend led to an increase in monthly rents, which in the capital now start at 400 euros/month.

"Today it is difficult to find 1+1 and 2+1 apartments for long-term stays, especially in central areas. If these apartments were put on the market, the monthly rent would definitely decrease," says Ms. Dhami.

Real daily income does not exceed 20 euros per day, except for two summer months.

You can rent an apartment for 40-80 euros per day, but not all months are occupied. According to AirDNA statistics, the occupancy rate ranges from 30% in January to 60% in August.

The RevPAR (revenue per available room), which shows real daily revenue based on a month's collection and gives a clearer idea of ??the health of the market than high total revenue figures, in 2024 fluctuated from 14 euros in January to 49 euros in August, with the latter increasing from coastal areas.

For most of the year, daily income does not exceed 20 euros.

This means that if you rent your house in January for an average daily rent of 44 euros, the apartment will be occupied 32% of the time, or 10 days. Your monthly income will not exceed 420 euros, or about 14 euros per day.

In August, when the rent reaches 81.5 euros and the residential unit is occupied 60% of the time, the net monthly income reaches almost 50 euros.

On a simple average, the monthly income from daily rentals in Albania is 26 euros, or 780 euros per month. This is a gross income, as expenses such as cleaning, energy, depreciation, other costs of repairing and replacing equipment, etc., must be taken into account, which can reach from 100 to 200 euros per month.

From short-term rental, back to long-term

While many individuals are letting their homes out for daily rentals, increasing the stock of available units listed on Airbnb, those who started this business earlier are doing the opposite.

The increase in long-term rentals from the decrease in supply and the decrease in daily rentals from the increase in stock is causing the return to equalize, or even be higher and guaranteed for home rentals with a monthly or longer frequency.

Entela owned three apartments outside the Ring Road area, which after the pandemic he began renting out on a daily basis, seeing the increase in demand from tourists.

In 2022, she says she was selling them for up to 60 euros a night. More than half the time, the premises were occupied, with a monthly income of 900-1200 euros per month.

"It was a very good year and there was always demand."

During 2023, this business began to be "copied" by many. The offer within the main ring road and in the center increased significantly and a two-room apartment was being rented for 40 euros/night.

The trend continued in 2024, causing prices in her area to drop to 30 euros/night, due to strong competition.

In addition to the fact that the apartment is not occupied every night, including fixed expenses, net income decreased significantly.

"Energy costs were high because tenants kept the air conditioner on all the time, the equipment depreciated quickly, and sheets and towels had to be purchased frequently," she claims.

Entela has now given up on daily rent and is renting out apartments long-term, for 500-600 euros per month.

"Last year brought a significant increase in the number of properties on the market, which has affected the performance of short-term rental properties in Albania," says Brendi Hoti, from the daily apartment rental agency "Pikhost."

"Especially in the big cities, like Tirana, Vlora, Shkodra, there have been many new properties. This has led to a smaller number of reservations for each property."

That said, property managers have lowered prices to be more competitive.

"So many properties have had a drop in income compared to the previous year. The properties that have not been affected are those that are of higher quality (e.g. modern furnishings, new buildings, good location) and exclusive/luxury properties," says Mr. Hoti. The fall of the Euro further reduces returns

In addition to increased competition, which has not allowed prices to increase, especially in the capital, the Euro has dealt another blow to rental returns.

For example, Entela, in 2022, rented an apartment for 60 euros, which, converted at the then exchange rate of 118 lek, was about 7 thousand lek.

In 2024, besides the price falling to 40 euros and the exchange rate being 100 lek, income in Lek was only 4 thousand lek, or about 40% less than two years ago./ Monitor Magazine