What kind of rental is the best kind of rental?
When we’re talking about short-term versus long-term rentals, it depends a lot on location.
Quick Overview:
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The Vancouver, WA area has been getting a lot of attention from real estate investors, and that’s thanks to the high quality of life and abundance of natural beauty in Southwest Washington.
But once you own an investment property, a crucial decision follows: should you rent it out to short-term visitors who might be in town for a few days or a couple of months? Or, does it make more financial sense to lease it out for the long-term, typically a year or longer?
Both strategies offer unique advantages and potential pitfalls. The profitability of each largely depends on factors such as location, demand, operating costs, local regulations, and your own investment goals.
As local property management experts, we can give you some insight that will help you decide which rental model may bring the strongest returns.
Understanding the Basics
Before we compare profitability, let’s define what we mean by each type of rental.
Short-Term Rentals (STRs). These are properties rented out for brief periods, often less than 30 days. Think of the homes you might find listed on Airbnb, Vrbo, or other vacation rental platforms.
Long-Term Rentals (LTRs): These are properties leased to tenants for extended periods, typically a year or longer, with a fixed monthly rent and a rental contract in place.
The Southwest Washington Rental Market
Vancouver and the surrounding Clark County area have seen significant growth in housing demand due to a number of factors, including population growth, tech migration from Portland, and a relatively affordable cost of living compared to the metro area across the Columbia River. This creates opportunities in both the short- and long-term rental spaces.
However, Vancouver’s real estate landscape is unique in several ways:
Proximity to Portland draws tourists but also commuting professionals.
There’s a strong local renter base due to high home prices.
Regulatory attitudes toward STRs are evolving, and in many areas the laws and regulations have become more restrictive than in past years.
With that in mind, let’s break down the pros, cons, and potential profitability of each rental strategy.
Short-Term Rentals: High-Risk, High-Reward Model
Not every market will support vacation rentals. Ours will, thanks to tourism and business activities that draw people to the area. Here’s what you might love and not love about the potential for a short-term rental.
Pro: Higher Revenue Potential
STRs can often generate 1.5x to 3x the monthly income of a comparable long-term rental. A well-furnished, well-located Vancouver home might bring in at least $150–$250 per night. If occupancy stays above 65-70%, that’s a potentially lucrative income stream. Per-night rates are definitely higher with short stays.
Pro: Flexibility
You can use the property personally during off-peak times or pivot your rental strategy seasonally. This makes STRs appealing for investors who might want to mix business with leisure.
Pro: Faster Return on Renovations
Upgraded kitchens, luxury furnishings, and amenities like hot tubs or fire pits can command premium nightly rates. STR guests often pay for experience, not just utility.
Con: Higher Operating Costs
STRs require ongoing management, cleaning between guests, utilities, furnishings, and maintenance. These costs can eat into profits quickly if not closely monitored.
Con: Seasonality and Vacancy
Unlike long-term tenants, STR demand fluctuates. Summer may be fully booked, but winter months may be slow. In Vancouver’s rainy season, occupancy rates often dip.
Con: Regulatory Risks
Many Washington cities—including Vancouver—are tightening regulations around STRs. Licensing requirements, zoning limitations, and even outright bans in some residential areas can pose serious hurdles.
Con: Management Burden
Hosting short-term guests requires ongoing attention. If you’re not using a property management company, expect to be on call frequently.
In high-demand areas close to downtown Vancouver, Esther Short Park, or near the waterfront, STRs can be very profitable, but only if managed efficiently. Homes with separate entrances, ADUs (Accessory Dwelling Units), or unique appeal tend to outperform standard rentals.
Long-Term Rentals: The Reliable Income Generator
As property managers and investment professionals, we’re always talking about the reliability of a long-term lease. We appreciate the fact that it’s easier to plan, budget, and set goals. Not every investor has the same appreciation of status-quo, however. Here’s where the pros and cons break down.
Pro: Stable Income Stream
With a long-term lease, you have predictable monthly rent. Cash flow is steady, which simplifies financial planning and mortgage servicing.
Pro: Lower Management Effort
Tenant turnover is lower, and you don’t have to manage bookings, cleaning, or guest issues daily. A good property management company can handle much of the logistics.
Pro: Lower Operating Costs
Tenants typically pay utilities, and you don’t need to furnish the property or perform constant upkeep.
Pro: Favorable Tax Benefits
Long-term rentals often qualify for greater depreciation deductions and fewer self-employment taxes than STRs (consult your CPA for details).
Con: Lower Monthly Revenue
A property that could generate $4,500/month as an STR might only earn $2,000/month as a long-term rental. That said, your expenses are lower too.
Con: Tenant Risks
Long-term tenants can damage property, miss payments, or require eviction. Screening is critical. In Washington, landlord-tenant laws strongly favor tenants, so managing legal compliance is vital.
Con: Lack of Flexibility
Once a lease is signed, you’re committed. Want to sell the property, raise rent, or use it yourself? You may need to wait.
Long-term rentals remain a solid investment, especially in family-friendly neighborhoods like Fisher’s Landing, Salmon Creek, or Orchards. Demand for rentals continues to outpace supply, and vacancy rates remain low in most of Clark County.
There’s no single answer to the question of whether you’re better off investing in short-term rentals or long-term properties. But we can share our knowledge, our data, and our resources to assist you when making these decisions.
If you’re trying to decide whether a long-term lease or a short-term vacation rental is the best investment path for you, we can help you make the right decision. Contact us at SunWorld Group. We’re here to help with all your property management needs, and provide services throughout Southwest Washington and Southeast Florida.
