When most people think about UK property investment, traditional long-term lets immediately come to mind. However, with the rapid growth of Airbnb, serviced accommodation and staycation demand, many investors are now asking an important question:
Could short-term lets generate better returns than traditional buy-to-let properties?
The answer depends on your goals, risk appetite and the type of property you own. Both strategies have advantages, and understanding the differences could make a significant impact on your long-term returns.
If you’re researching your next investment, this guide breaks down how buy-to-let compares with short-term accommodation, where each strategy works best, and why many investors are now seeking developments that offer flexibility between both.
What Is a Traditional Buy-to-Let?
A traditional buy-to-let property is rented to tenants on a long-term basis and remains one of the most popular ways to invest in UK property due to its stability and predictable income.
Benefits:
- Consistent monthly income
- Lower management requirements
- Stable occupancy
- Long-term capital growth
- Lower operating costs
Considerations:
- Lower yields than short-term lets
- Less flexibility
- Rental increases are less frequent
What Are Short-Term Lets?
Short-term lets, also known as serviced accommodation, involve renting properties on a nightly or weekly basis through platforms such as Airbnb and Booking.com. They have become increasingly popular with investors due to their potential to generate higher returns.
Benefits:
- Higher income potential
- Greater flexibility
- Increased cash flow
- Ability to adjust pricing during peak periods
Considerations:
- More hands-on management
- Seasonal fluctuations
- Higher operating costs
- Income is not guaranteed
Which Strategy Produces Better Returns?
Traditional buy-to-let properties across the UK typically produce rental yields of around 5–7%.
Short-term lets, however, can generate yields exceeding 10% in the right locations.
This is why many investors are now looking at developments specifically suited to serviced accommodation.
For example, One Trafford Edge, available through Verta Property Group, is positioned at the heart of one of the UK’s most exciting regeneration stories.
The wider Trafford area is benefiting from the £2.6 billion TraffordCity masterplan, which is transforming the area through new residential communities, commercial space, leisure attractions and infrastructure improvements.
One of the most anticipated additions is Therme Manchester, a £250 million wellbeing resort set to become the UK’s first city-based wellness destination. The development is expected to create around 1,200 jobs and attract millions of visitors each year.
The area is also set to benefit from the ambitious Old Trafford regeneration project, which includes proposals for a new 100,000-seat stadium, up to 15,000 new homes and approximately 48,000 jobs. Combined, these projects are expected to bring a significant increase in tourism, employment and business activity to Trafford over the coming decade.
For short-term let investors, regeneration is particularly important. New attractions, sporting events, business hubs and employment centres naturally create demand from:
- Business travellers
- Contractors and relocating professionals
- Tourists and leisure visitors
- Manchester United supporters visiting Old Trafford
- Guests attending events throughout Greater Manchester
For investors seeking a more traditional approach, projected long-term rental yields are estimated at approximately 5–6% per annum.
However, investors considering serviced accommodation may benefit from projected returns of 10–11% per annum, based on an anticipated occupancy rate of around 80%, subject to market conditions and operator performance.
As regeneration continues across Trafford and Greater Manchester, investors may benefit not only from attractive rental income but also from the potential for long-term capital growth driven by one of the UK’s largest regeneration programmes.
Why Location Matters More Than Ever
Regardless of strategy, location remains the single most important factor when investing in property.
High-growth cities generally provide:
- Strong tenant demand
- Rising rents
- Long-term capital appreciation
- High occupancy rates
Liverpool continues to attract investors due to extensive regeneration and increasing demand from professionals, students and tourists.
One example is The Quayline at Wirral Waters, available through Verta Property Group and positioned within one of the UK’s largest regeneration schemes.
The development forms part of the £4.5 billion Wirral Waters masterplan, a transformational waterfront project spanning more than 500 acres of former docklands. Once complete, the scheme is expected to deliver approximately 13,000 new homes, 20 million square feet of commercial space and up to 20,000 jobs, creating an entirely new mixed-use destination across the Liverpool City Region.
Located directly opposite Liverpool’s skyline, The Quayline benefits from a unique waterfront setting while remaining just minutes from Liverpool city centre. The wider regeneration programme continues to attract businesses, residents and investment into the area, helping to drive long-term rental demand and capital growth.
Evidence of this demand can already be seen at nearby Millers Quay, where all 500 apartments reached full occupancy following completion, demonstrating the strength of the local rental market.
Regeneration on this scale creates demand from:
- Young professionals relocating to Liverpool.
- Employees working across the Liverpool City Region.
- Students and graduates remaining in the area.
- Business travellers and contractors.
- Long-term tenants seeking modern waterfront homes.
For investors seeking a traditional buy-to-let strategy, projected long-term rental yields are estimated at approximately 6% per annum.
For those considering serviced accommodation, projected short-term let yields are estimated at up to 11.2% per annum, subject to occupancy levels and operator performance.
As one of the UK’s most ambitious waterfront regeneration projects continues to evolve, developments such as The Quayline offer investors the opportunity to benefit from both attractive rental income and long-term capital appreciation driven by sustained investment and economic growth.
Which Investors Prefer Buy-to-Let?
Traditional buy-to-let is often better suited to investors who:
- Prefer passive income
- Want predictable monthly cash flow
- Are building a long-term portfolio
- Value stability over maximising returns
Many investors still consider buy-to-let the foundation of a successful property portfolio.
Which Investors Prefer Short-Term Lets?
Short-term accommodation may suit investors who:
- Want higher returns
- Are comfortable with fluctuating occupancy
- Invest in city centres or tourist locations
- Prefer flexibility
Cities such as Liverpool and Manchester continue to experience strong demand from both business and leisure travellers, making serviced accommodation increasingly attractive.
Final Thoughts
Both traditional buy-to-let and short-term lets can be excellent property investment strategies, with each offering its own unique advantages. Buy-to-let properties provide stable income and long-term capital growth, while short-term lets can deliver enhanced returns in locations benefiting from strong tourism, business travel and large-scale regeneration. Ultimately, the best approach depends on your investment objectives, preferred level of involvement and the type of returns you are looking to achieve.
