If you own a house in a tourist region like Sardinia, your chances of success are even greater due to the constant influx of tourists. Here are some practical, economic and rental tips, with an analysis of the pros and cons, including tax aspects such as the cedolare secca.
Why rent your holiday home?
1. Extra income
Renting your house during the periods when you are not using it can become a very profitable source of income, especially in tourist destinations such as Sardinia, where the demand for seasonal accommodation is high. During the summer season, prices can rise considerably, offering a very good return on investment.
2. Continuous maintenance
By renting the house, you will have an incentive to keep the property in good condition. In addition, frequent use of the home reduces the risk of abandonment damage, such as plumbing or electrical problems that can occur when a home remains uninhabited for a long time.
What you need to know
1. Property Management
Renting a holiday home takes time and effort but is not impossible. You will have to take care of bookings, check-in/check-out, cleaning and maintenance between guests. If you do not live near your property, you may need a management agency, which entails additional costs.
2. Tenant-related risks
In spite of security measures and guest selection, there is always the risk of damage to the property or of tenants not respecting the house rules. It is important to take out holiday rental insurance and to include liability clauses in contracts to protect yourself against damage.
3. Tax and legal obligations
In Italy, tourist rental is subject to specific regulations. You will need to declare income from the rental and deal with any local or municipal taxes such as the tourist tax. In addition, you must comply with hospitality regulations, such as notifying the Questura within 24 hours of the arrival of guests.
Calculation of earnings
Renting a holiday home in Sardinia, especially in popular locations such as Costa Smeralda, Alghero, Villasimius or Santa Teresa di Gallura, can be very remunerative, especially during the high season (June-September). Prices vary considerably depending on the location and characteristics of the property, but can reach very high figures for houses close to the sea or with luxury features.
Here is how to make an approximate calculation:
Average daily rate - For a standard house close to the sea, you can ask between 100 and 250 euro per day during the high season. Obviously it depends on the type of house. In this example we are talking about a two-room apartment.
Average occupation - Depending on location and promotion, you can expect an average occupancy of 70-80% during the summer months.
With 30 days' rent at an average price of EUR 150 per night, the monthly income can reach around EUR 4,500, which can easily cover the annual expenses of the house and generate a profit.
How to prepare your home
Furnishing and comfort
Guests expect a holiday home to be well furnished and equipped with all necessary amenities. Consider investing in quality bedding, modern appliances and kitchen accessories. Also provide a stable and fast Wi-Fi connection, an essential requirement for many travellers.
Professional photographs
Pictures are key to attracting potential tenants. Investing in a professional photographer to show your home at its best is an expense that easily pays off with faster bookings.
Managing Reviews
Reviews are key to improving your home's visibility on platforms like Airbnb and Booking.com. Offer an excellent experience and politely ask guests to leave positive feedback. Reviews help increase trust and attract more bookings.
How to rent your house in Sardinia
Most renters today rely on online booking platforms such as Airbnb, Booking.com, Vrbo, which offer global visibility and easy tools to manage bookings, payments and reviews.
Locally but open to an international audience there is also Sardinia4Rent - a portal offering the same functionality as Airbnb but focused on Sardinia.
Local management agencies
In Sardinia, many real estate agencies offer full management services for tourist rentals. Relying on an agency can simplify the entire process, from promotion to assisting guests, but it entails commissions of up to 30% of revenue. If you are willing to monitor portals and bookings and have a trusted person who can do the check-in and check-outs it will probably cost you much less. Let's not forget that final cleaning is always paid for by the host.
Regulations and licences
In Sardinia, the SCIA (Segnalazione Certificata di Inizio Attività) for occasional tourist rentals is not required to rent a holiday home. However, it is compulsory to register your property with the I.U.N. (Identificativo Unico Numerico) portal, managed by the Region of Sardinia. This code is indispensable for legally renting out your holiday home and must be entered in every advertisement published online.
In addition, you must comply with the rules on notifying guests to the Questura within 24 hours of arrival, using the Alloggiati Web portal. Finally, if provided for by the municipality, you will have to collect and pay the tourist tax for each guest.
Fiscal Aspects
Besides the practical aspects, one of the most important aspects to consider when renting out your holiday home concerns the tax management of rental income. In Italy, rental income has to be declared and taxed, but there is a very attractive preferential tax regime called 'cedolare secca'.
What is it?
The 'cedolare secca' is an optional tax regime that allows rental income to be taxed at a fixed substitute rate, avoiding the progressive system of IRPEF and other related taxes. This tax regime is particularly interesting for those who rent properties to private individuals for residential use, including short-term tourist rentals.
The rate of the 'cedolare secca' is currently 21% for free-rent (i.e., with no ties on the rental price). This single tax replaces:
- IRPEF (Personal Income Tax) that would normally apply to rental income;
- Municipal and regional surcharges;
- Registration fee and stamp duty due for the registration of the lease.
Opting for the 'cedolare secca' also brings the advantage of not having to pay registration and contract renewal fees, which can represent a considerable saving, especially for short-term and frequent rentals.
How is it applied?
To apply the 'cedolare secca', it is necessary to declare that you wish to use this tax regime. The choice of 'cedolare secca' can also be exercised for short-term tourist rentals, but ask an accountant for details! The 21% withholding tax applies to all landlords who rent properties via online portals, including foreign ones. It is crucial that landlords are aware of these aspects.
Is this a good idea?
Renting your holiday home in Sardinia can be very profitable. If you are willing to invest time and resources in the preparation and promotion of your property, the economic benefits can be significant.
With the right strategy, renting your holiday home in Sardinia can turn into a steady source of income and a long-term investment.
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