Published on and written by Cyril Jarnias
Airbnb Rentals vs Long-Term Rentals in Croatia: Which Option for Property Owners?
In an economic context marked by continuous tourism growth in Croatia, many property owners face the dilemma of choosing between Airbnb rentals and long-term rentals.
Both options offer potentially attractive returns, but they differ significantly in terms of income, management, and risk.
Profitability by City: A Comparative Analysis
By examining profitability by city, our study aims to provide clear comparative data to help owners make the best choice.
From Dubrovnik to Zagreb, each city has unique characteristics that influence the rental market, and this report highlights these differences to offer a comprehensive overview of the opportunities and challenges in the Croatian real estate market.
Good to Know:
The choice between seasonal and long-term rental heavily depends on the property’s location and its tourist traffic.
Numerical Analysis of Rental Profitability in Croatia
| City | Airbnb Rent (Summer, €/night) | Occupancy Rate (High Season) | Monthly Long-Term Rent (€) | Gross Airbnb Yield* (%) | Gross Long-Term Yield (%) | Airbnb Management Fees (%) | Local Short-Term Taxes | Maintenance (Estimated %) | Seasonality and Variations | Rental Potential |
| Dubrovnik | 180–350 | 85–95% | 850–1,100 | 10–14 | 4–5 | 15–25 | 10–13% | 5–8 | Very High: Peak summer season, low off-season | High (Strong summer demand, high seasonality) |
| Split | 120–250 | 80–90% | 800–1,000 | 8–12 | 4–6 | 12–20 | 10–12% | 5–7 | High: High occupancy in summer, moderate rest of year | High (Better stability than Dubrovnik) |
| Zagreb | 60–120 | 55–75% | 700–900 | 6–9 | 4–5 | 10–18 | 8–10% | 4–6 | Moderate: Business tourism, less seasonal | Moderate to Good (Steady profitability) |
| Rijeka | 70–140 | 60–75% | 600–800 | 6–8 | 3–4 | 10–18 | 8–10% | 4–6 | Low to Moderate: Summer season, low off-season | Average (Less competitive market) |
| Secondary Cities (e.g., Osijek, Slavonski Brod) | 35–70 | 35–60% | 400–650 | 3–6 | 2–4 | 10–15 | 6–8% | 3–5 | Low: Local tourism, low seasonality | Low (High vacancy risk) |
Comparison of Income and Associated Costs
- Airbnb (Short-Term)
- High gross income during peak season (up to 3x more than long-term rental in summer in Dubrovnik or Split)
- Management Fees: 10–25% depending on service (professional management recommended to maximize occupancy)
- Local Taxes: 10–13% on short-term rental income
- Maintenance: Higher costs (cleaning, turnover, wear and tear)
- Seasonality: Heavy reliance on peak season (June–September), low or no income off-season
- Net Profitability: Higher than long-term in tourist cities during summer, but more volatile annually
- Long-Term Rental
- Stable income over 12 months, near 100% occupancy rate
- Management Fees: 5–10%
- Taxes: Lower, more stable taxation
- Maintenance: Lower costs (less turnover, moderate wear)
- Seasonality: Minimal impact, more stable market
- Net Profitability: Lower than Airbnb in peak season, but more predictable and secure
Analysis by City
- Dubrovnik: Some of the highest Airbnb yields in Southern Europe in summer, but extreme dependence on tourist season and winter vacancy risk.
- Split: Very good compromise, long summer season, growing off-season demand (events, conferences).
- Zagreb: Business market, less seasonal, less spectacular Airbnb income but more stable; long-term rental remains competitive.
- Rijeka and Other Coastal Cities: Decent rental potential in summer, but difficult to profit off-season without diversification.
- Inland Cities: Low Airbnb yield, long-term rental is preferable.
Seasonality and Profitability
- Peak Season (June–September): Airbnb can generate up to 2–3 times more than long-term rental.
- Off-Season: Occupancy rates sometimes below 30%; some owners switch to long-term to stabilize income.
- Annual Variation: Net Airbnb profitability can drop 30–40% off-season if no alternative rental is found.
Summary of Net Yield Differences
| City | Airbnb: Estimated Annual Net Yield | Long-Term Rental: Annual Net Yield |
| Dubrovnik | 7–10% | 3–4% |
| Split | 6–9% | 4–5% |
| Zagreb | 4–6% | 4–5% |
| Rijeka | 4–6% | 3–4% |
| Secondary Cities | 2–4% | 2–3% |
Key Takeaways:
⧉ The best rental potentials are on the coast, in Dubrovnik and Split, but profitability heavily depends on the season.
⧉ Costs (management fees, taxes, maintenance) significantly reduce Airbnb’s gross yield, especially off-season.
⧉ Long-term rental remains a safe choice, especially in less touristy cities or during off-season periods.
Good to Know:
In Croatia, rental yields vary significantly between Airbnb and long-term rentals, influenced by factors such as management costs and seasonality. For example, in Dubrovnik, an Airbnb rental can generate up to 20% more income compared to a long-term rental, especially during the peak tourist season, after deducting management and maintenance fees. Split and Zagreb show similar yield rates, with Airbnb net income often 15% higher than traditional rentals. However, in less touristy cities, Airbnb income tends to align with long-term rental due to more stable but less intense demand. Comparative charts clearly show that while Airbnb rentals are potentially more lucrative, they require active management to optimize profitability, particularly off-season when occupancy rates can drop significantly.
Yield Comparison: Airbnb vs Long-Term Rental
| City | Airbnb Rental (Average €/night) | Peak Season Occupancy Rate (%) | Monthly Airbnb Income (Summer) | Monthly Long-Term Rent (€) | Estimated Annual Gross Airbnb Yield (%) | Estimated Annual Gross Long-Term Yield (%) |
|---|---|---|---|---|---|---|
| Zagreb | 85–120 | 65–80 | ~2,500 | 550–800 | 7–10 | 4–5 |
| Split | 120–200 | 80–90 | ~3,500 | 700–1,000 | >10 | ~5 |
| Dubrovnik | 180–342 | >90 | ~6,000 | 900–1,400 | >12 | >6 |
| Zadar | 100-150 | 75-85 | 2,800 | 600-950 | 8-11 | 4-6 |
Concrete examples based on listings and local market averages.
List of Factors Influencing Yield
- High Seasonality: Maximum tourist influx from June to September, full occupancy rates on the coast and in historic cities.
- Tourist Potential: Dubrovnik, Split, and Zadar show very high international demand, while Zagreb attracts more business or local clientele outside summer.
- Local Regulations: Limitation on allowed short-term rental nights in some urban areas; need to register with Croatian authorities.
- Traditional Rental Demand: Stable market in Zagreb, volatile on the coast where long-term rental is less popular in summer.
Associated Costs by Type
Airbnb Rental
- Cleaning fees and platform commission (approx. 15%)
- Higher utility costs (water/electricity/gas) due to turnover.
- Mandatory tourist taxes.
Long-Term Rental
- Fewer additional fees; utilities often shared or assumed by tenant.
- Simplified administrative management.
Comparative Analysis
⬛️ Renting via Airbnb generates a much higher potential yield during the summer peak season in coastal cities like Dubrovnik or Split, with income potentially two to three times higher than traditional rents. However, off-season (October-April), occupancy rates sometimes drop below 30%, making this strategy risky without flexible adaptation to medium/long-term rental.
⬛️ In Zagreb, where activity is not exclusively tourist but also commercial/academic year-round, long-term rental offers stability but lower yield. Owners often prefer a combination of short/medium-term rentals depending on their risk tolerance and liquidity needs.
Main Strengths
- Higher profitability for Airbnb during summer on the coast.
- Extreme seasonality requiring flexible model.
- Strict regulation in some Croatian municipalities.
- Annual rental demand remains strong only in Zagreb.
In summary:
Profitability heavily depends on geographic choice: on the Adriatic coast, especially Dubrovnik/Split/Zadar – clear advantage for Airbnb in summer; in Zagreb – better stability with traditional rental.
Good to Know:
In Zagreb, although long-term rental offers stability with an average rent of 600 to 800 euros per month for a two-room apartment, Airbnb can generate monthly income of 1,200 to 1,500 euros during the summer peak season, thanks to high tourist demand. In Split and Dubrovnik, seasonality plays a crucial role, where tourist peaks allow Airbnb owners to sometimes quadruple their income compared to the off-season. However, in Zadar, where local regulations are tightening, the long-term option provides security at 500 euros monthly, minimizing vacancy risk. Airbnb yield often exceeds that of traditional rentals, but it comes with higher maintenance and management costs. It is essential to consider tourist potential and market dynamics, as regulations can vary and significantly influence potential income.
Factors Influencing the Choice Between Airbnb and Long-Term Rental in Croatia
Croatian property owners choose between Airbnb (short-term rental) and long-term rental based on several major factors:
Tourism Seasonality in Croatia
- Tourist demand is highly marked by the summer season, especially on the coast (Dubrovnik, Split), with high influx from June to September.
- Off-season, short-term rental occupancy rates drop sharply, limiting potential Airbnb income in some coastal cities.
Differences in Potential Profitability
| Criterion | Airbnb/Short-Term | Long-Term Rental |
|---|---|---|
| Income Potential | Higher in summer, variable rest of year (up to 12% gross in some comparable markets) | Stable but generally lower (4 to 6% gross) |
| Occupancy Rate | Seasonal and uncertain off-season | Near 100% if well located |
| Management/Logistics | Requires more time for cleaning and guest接待 | Less time-consuming after lease signing |
- In Dubrovnik or Split: Airbnb can be very lucrative during peak season due to high rates charged to international tourists.
- In Zagreb: The market is less subject to seasonality; long-term rental offers more economic stability.
Local Short-Term Rental Regulations
- Several major cities impose restrictions on short-term rentals (limits on number of days/year, specific taxes).
- Administrative procedures are sometimes burdensome to obtain a tourist license. Some municipalities seek to preserve their residential rental stock.
Impact of the COVID-19 Pandemic
- The health crisis revealed the vulnerability of the Airbnb model to external shocks. Many owners turned to long-term rental during border closures or tourist restrictions.
- Since 2022/2023, a gradual return to short-term is observed in tourist areas with the recovery of international tourism.
Tenant and Tourist Preferences
Tourists:
- Seek flexibility, authenticity, and modern amenities via Airbnb or equivalent platforms.
- Often prefer Dubrovnik/Split for their cultural/natural attractiveness; thus accept high prices in peak season.
Long-Term Tenants:
- Desire contract stability and advantageous monthly rates.
- Varied profiles: students in Zagreb, expats/digital nomads benefiting from equipped urban setting with wifi/remote work.
Economic Aspects
Fixed costs increase quickly for Airbnb (recurrent cleaning, accelerated maintenance), while charges are better controlled in traditional leases.
Logistical Aspects
- Renting on Airbnb requires availability to host/manage each turnover – an agency may be necessary if physically absent.
- Traditional rental: Simplified management but less ability to quickly adjust rents according to local market evolution.
Legal Aspects by City
| City | Short-Term Rental | Long-Term Rental |
|---|---|---|
| Dubrovnik | Strict regulation + high taxes; maximum possible yield but high tourist turnover | Less attractive due to high real estate pressure |
| Split | High summer demand; variable local regulation | Stability sought outside hyper-touristic zones |
| Zagreb | Less subject to tourist peaks; moderate regulation | Stable market year-round |
Boxed Summary:
- Geographic positioning,
- Risk/seasonality appetite,
- Logistical/management capacity,
- Local regulatory developments
The pandemic reinforced for some owners the need for financial security through a stable lease, while others continue to prioritize the higher yields offered by international tourism during summer peaks.
Good to Know:
In Croatia, the choice between Airbnb and long-term rental is often influenced by tourism seasonality, with coastal cities like Dubrovnik and Split attracting more tourists during summer, thereby increasing the profitability of short-term Airbnb rentals. Local short-term rental regulations, stricter in some municipalities, can also steer owners towards long-term rentals, especially in Zagreb where rental demand is more stable year-round. The COVID-19 pandemic disrupted the market, pushing owners to prioritize financial stability through long leases when tourism plummeted. Tenant and tourist preferences also play a crucial role; tourists often seek authentic, well-located accommodations, while long-term tenants prioritize proximity to services and transport, further influencing owners’ logistical and economic decisions.
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Cyril Jarnias is an independent expert in international wealth management with over 20 years of experience. As an expatriate himself, he is dedicated to helping individuals and business leaders build, protect, and pass on their wealth with complete peace of mind.
On his website, cyriljarnias.com, he shares his expertise on international real estate, offshore company formation, and expatriation.
Thanks to his expertise, he offers sound advice to optimize his clients' wealth management. Cyril Jarnias is also recognized for his appearances in many prestigious media outlets such as BFM Business, les Français de l’étranger, Le Figaro, Les Echos, and Mieux vivre votre argent, where he shares his knowledge and know-how in wealth management.
