What is Serviced Accommodation?

If you’ve been browsing property listings or investment forums, you’ve probably seen the term serviced accommodation cropping up more often. But what is serviced accommodation, and why are so many people talking about it?

In this blog, we’ll explain exactly what serviced accommodation means, who uses it, how it differs from hotels or rentals and what landlords need to know if they’re considering it. We’ll also look at the pros and cons, and where it fits into the wider UK property market.

The basics: what is serviced accommodation?

Serviced accommodation is a type of fully furnished property that’s available for short-term stays. Think of it as a cross between a hotel and a rental flat. Guests have the space and facilities of a home, such as a kitchen and living area, combined with some of the services you’d expect from a hotel, like cleaning or linen changes.

These properties can be apartments, houses or part of larger developments. They’re popular with business travellers, tourists, contractors working away from home and people relocating temporarily.

How is serviced accommodation different from a hotel?

At first glance, serviced accommodation and hotels seem similar. Both offer short-term stays and often include cleaning and bills. But there are some clear differences.

Hotels typically provide just one room, whereas serviced accommodation offers an entire living space. That means guests can cook meals, do laundry and relax in a living room rather than being confined to a bed and bathroom. For longer stays, this extra space makes a huge difference.

Serviced accommodation is also usually priced per property rather than per person, which can work out cheaper for families or groups.

How is serviced accommodation different from other rental models?

Compared to a standard tenancy, serviced accommodation is far more flexible. A rental agreement often ties a tenant in for six months or longer, but serviced accommodation can be booked for a few nights, weeks or months.

Bills and services are generally included in the price, so guests don’t have to worry about setting up utilities, internet or council tax. For landlords, this flexibility means they can often charge a premium compared to a long-term rental.

But how does serviced accommodation compare to rentals on platforms like Airbnb and Booking.com? While you can list a serviced apartment on Airbnb, you can also list a spare room or a holiday cottage. What makes something serviced accommodation is the combination of full furnishing, flexibility and extra services.

Many serviced accommodation providers use Airbnb and similar sites to find guests, but professional operators often market through corporate travel agents or relocation companies too.

Who uses serviced accommodation?

Serviced accommodation has a wide audience. Business travellers often prefer it over hotels, especially if they’re working on projects that last several weeks or months. Tourists and families value the extra space and ability to self-cater. 

Contractors working away from home use serviced accommodation as a more homely alternative to hotels. And people relocating might book a serviced apartment while they search for a permanent home.

In short, it caters to anyone who needs a flexible, fully equipped place to stay.

Why is serviced accommodation growing in the UK?

The rise of serviced accommodation is linked to changing lifestyles and work patterns. Business travel has evolved, with companies seeking cost-effective alternatives to hotels for staff on long assignments. Tourism has also shifted, with travellers valuing space, privacy and the option to cook rather than eating out for every meal.

Platforms like Airbnb and Booking.com have boosted visibility, making it easier for landlords to market serviced accommodation directly to guests. As a result, more investors are exploring this model as a way to increase rental yields.

The benefits of serviced accommodation for guests

From a guest’s perspective, serviced accommodation feels less like a stopgap and more like a home. The extra space compared to a hotel room means you can properly unpack, spread out and live comfortably rather than perching on the edge of a bed.

The ability to cook your own meals is another big draw. Eating out every day is costly and often tiring, so being able to shop locally and make your own food helps both the budget and the routine. For families and groups, that flexibility is even more valuable.

Privacy is another perk. Guests can come and go as they please without walking past reception or relying on hotel staff. For contractors working night shifts or business travellers who need to work odd hours, this freedom is far more practical.

When you add up the space, the savings and the independence, it’s clear why serviced accommodation has become such a popular option.

The benefits of serviced accommodation for landlords

For landlords, the big draw is higher potential income. According to research by Savills, serviced apartments in the UK brought in 27.5% more revenue per room than hotels between 2021 and 2023. In London, profit margins can run as high as 45-55%, compared to 30-40% for hotels. 

Now set that alongside a standard residential let. The same two-bed flat that brings £1,200 a month on a long tenancy could generate £2,000 or more as serviced accommodation if demand holds. Of course, you’ll have extra costs for cleaning, utilities and turnover, but it shows why many landlords are tempted by the model

Flexibility is another plus. Instead of being tied into a long tenancy, landlords can adjust prices seasonally or block out dates if they want to use the property themselves. If you’re a landlord in a seaside town, for instance, you can charge premium rates in summer and then block off a week in September for your own family holiday.

Serviced accommodation also allows landlords to diversify. By catering to tourists in summer and contractors in winter, they can balance demand and keep occupancy up year-round. For those who enjoy a more hands-on approach, the frequent guest turnover can be a chance to keep the property in better shape than a long-term let, where wear and tear builds up unnoticed.

The downsides of serviced accommodation for landlords

Of course, serviced accommodation isn’t all rainbows and sunshine 24/7. Managing short-term lets can be far more demanding than a standard tenancy. Properties need regular cleaning, maintenance and guest communication. Many landlords use management companies to handle this, which eats into profits.

There are also regulatory considerations. Local councils may have rules about short-term lets, and landlords need to ensure compliance with health and safety standards, insurance and mortgage conditions.

Competition is another factor. With so many properties now marketed on platforms like Airbnb, standing out can be difficult. Poor reviews or patchy service can quickly damage reputation, and unlike with a long-term tenant, you can’t bank on guaranteed income each month.

Is renting out serviced accommodation right for you?

If you’re considering serviced accommodation, it helps to ask yourself a few honest questions:

• Do I live in or own a property in a high-demand area where guests will want to stay?
• Am I happy to take on the extra work of guest communication, cleaning and maintenance, or will I need to pay someone else to handle it?
• Can I cope with income that may rise and fall depending on the season and occupancy rates?
• Do I feel comfortable relying on reviews to attract future bookings?
• Would I be better off with the steady, predictable income of a long-term rental?

Your answers can help you weigh up whether serviced accommodation is the right strategy or whether it might leave you stretched thin.

For some, these questions highlight that selling a property could be the better route. You may want to release capital to buy a more suitable place for serviced accommodation, or you may decide the model simply isn’t for you. In those cases, selling can be a practical way to move forward.

Whatever your next move, make it with confidence

If you’ve decided serviced accommodation isn’t the right fit, or you need to sell a tenanted property in order to fund the purchase of something more suitable, that’s where we can help. At Sell House Fast, we buy properties directly for cash across the UK, providing certainty and speed. 

With us, you’ll get:

• Personalised service tailored to your circumstances
• A transparent process with no hidden fees (here’s how it works)
• A way to sell your house fast, often in a matter of days
• Expertise you can rely on, whatever type of property you own

So if you’re ready to move on, get a free cash offer and find out how we take the stress out of selling.