Leave your vacation rental management to the experts
Completely Free Online ConsultationWhen it comes to running a vacation rental, offering long-term stay discounts is an effective way to stabilize both occupancy and revenue. By lowering your per-night rate to encourage extended stays, you can unlock a range of benefits—from reduced cleaning and guest-acquisition costs to lower vacancy risk. That said, setting the wrong discount rate can eat into your profits or even create operational headaches.
In this article, we’ll take a close look at the concrete benefits of introducing long-term stay discounts for your vacation rental, along with the key points to keep in mind when setting them up. We’ll also cover how to configure these settings on platforms like Airbnb, sharing practical know-how along the way. If you’re a host considering rolling out a discount policy, this guide is for you.
5 Benefits of Offering Long-Term Stay Discounts for Your Vacation Rental
A long-term stay discount isn’t simply about lowering your nightly rate. Once you understand the underlying cost structure of running a rental, you’ll find that applying a discount can actually increase the profit you keep in hand. Below, we’ll walk through five key benefits with specific numbers to illustrate the impact.
More stable occupancy and reduced vacancy risk
Vacancy is the single biggest drain on profitability in vacation rental management. If you rely solely on one-night bookings, it’s not unusual for occupancy to drop to 30–40% during weekdays or off-peak seasons. Offering a long-term stay discount makes it easier to attract bookings of 7 nights or more—or even 30+ nights—locking in occupancy for extended periods.
For example, take a property priced at ¥10,000 per night with 50% monthly occupancy (15 nights)—that generates ¥150,000 in revenue. Now, if you apply a 20% monthly discount, bringing the rate down to ¥8,000 per night, but secure a full 30-night booking, your revenue jumps to ¥240,000. More stable occupancy also means more accurate revenue forecasting, which in turn improves your cash flow.
Reduced cleaning and linen-changing costs
Every time a guest checks out and a new one checks in, you need to clean the unit and change the linens. Cleaning costs vary depending on the size of the property, but typically run ¥3,000–¥5,000 for a studio and ¥8,000–¥15,000 for a 2LDK or larger. If a different guest stays each night, 15 cleanings a month could cost you ¥45,000–¥75,000.
With long-term guests, cleaning during their stay is often limited to once a week—or handled by the guests themselves—bringing the monthly cleaning count down to just 4–5 times. That difference alone can save you ¥30,000–¥50,000 per month. This is exactly the kind of cost structure that allows you to lower your nightly rate while still maintaining solid profit margins.
Significantly less time spent on guest communication
Check-in instructions, key handovers, property orientation, checkout confirmations—each guest interaction typically takes 30 minutes to an hour. If you’re hosting 15 groups a month, that adds up to 7.5–15 hours just on guest handling. With a single long-term guest, on the other hand, you only need to manage the initial communication and a final check at move-out.
Freeing up time on guest communication means you can focus on higher-value activities—expanding to manage additional properties, optimizing your listings, and so on. For hosts who self-manage, this time savings can be worth even more than the monetary benefits.
Improved search ranking on booking platforms
Airbnb’s algorithm favors listings that offer weekly or monthly discounts, giving them a boost in search results. This is because guests searching for long-term stays often filter specifically for discounted listings. On top of that, discounted listings display a “X% weekly discount” or “X% monthly discount” badge, which helps catch guests’ attention.
Better search visibility means more exposure without spending on advertising. This is especially valuable if you’re targeting remote workers or the “workation” market—long-term stay discounts can double as an effective guest-acquisition tool. In fact, some hosts who introduced a monthly discount reported a 20–30% increase in inquiries compared to before.
More consistent, positive reviews
Short-term guests are often traveling for leisure, so their reviews can be swayed by factors outside your control, like the weather or the surrounding neighborhood. Long-term guests, by contrast, are using the property as a base for work or daily life, so they tend to evaluate the property itself more fairly—things like usability and cleanliness of the facilities.
Long-term guests are also more likely to build a trusting relationship with the host, meaning that even if minor issues arise, they’ll often reach out directly rather than leave a negative review. Building up a base of positive reviews directly boosts your credibility on the platform and improves your booking rate.
Guidelines for Pricing Long-Term Stay Discounts
Setting the right discount rate is a critical factor affecting your bottom line. As a general industry benchmark, weekly discounts typically range from 10–15%, and monthly discounts from 20–35%. Keep in mind, though, these are just guidelines—the optimal discount rate will vary depending on your property’s location, layout, and fixed cost structure.
Let’s walk through a concrete example. Suppose a property priced at ¥12,000 per night has monthly fixed costs (rent, utilities, Wi-Fi, insurance, etc.) of ¥150,000, and each cleaning costs ¥5,000. If you operate on a nightly basis with 20 nights booked in a month, revenue comes to ¥240,000, but cleaning costs total ¥100,000 (20 cleanings)—after subtracting fixed costs, you’re left with a gross loss of -¥10,000. Now compare that to a 25% monthly discount bringing the rate to ¥9,000 per night: with a 30-night booking, revenue reaches ¥270,000, cleaning is needed only twice (move-in and move-out) at a total of ¥10,000, and after fixed costs, you’re left with a gross profit of ¥110,000. As this example shows, running a profit-and-loss simulation that balances your discount rate against expected occupancy is essential.
Points to Keep in Mind When Setting Long-Term Stay Discounts
While long-term stay discounts offer plenty of benefits, implementing them carelessly can lead to unexpected losses or operational trouble. Be sure to understand the following points and put safeguards in place before rolling out your discount.
Lost revenue from blocking out peak season
If a long-term booking overlaps with your peak season, you risk filling dates that could have commanded premium rates at your discounted price instead. For example, during cherry blossom season or major holidays, a property that could normally command ¥20,000+ per night might still be locked in at ¥9,000 if it falls under a monthly discount period. If 10 out of 30 nights in a long-term booking fall during peak season, that translates to over ¥110,000 in lost potential revenue.
To guard against this, you can lower the discount rate for bookings that overlap with peak periods, or block off your calendar around peak dates so long-term bookings can’t be made there. Airbnb lets you set minimum-night requirements for specific date ranges, so you can raise the minimum stay to just one night during peak season, prioritizing short-term, higher-rate bookings.
Budgeting for increased utility costs
Long-term guests tend to drive up utility costs significantly compared to short-term guests. Air conditioning in the summer and heating in the winter, in particular, can push monthly electricity bills up to ¥20,000–¥30,000. With one-night guests, the AC or heater typically shuts off when they’re out, but guests using the property as their daily living base often leave the air conditioning running throughout the day.
When determining your discount rate, be sure to factor in the potential increase in utility costs. Building in a buffer of ¥5,000–¥10,000 on top of your baseline monthly utility costs can help you avoid unexpected losses. If water usage isn’t billed at a flat rate for your property, also account for the increase in water costs from more frequent laundry use.
Move-out disputes and security deposits
Because long-term guests tend to treat the property more like their own home, the risk of damage to furniture or fixtures is higher than with short-term stays. Issues like scuffed walls, damaged furniture, or broken appliances sometimes only come to light at move-out. While Airbnb’s AirCover program offers some protection, it doesn’t cover every type of damage.
As a safeguard, we recommend requiring a security deposit for long-term guests—typically 10–20% of the total booking cost, or a flat amount of ¥30,000–¥50,000. It’s also good practice to photograph the property’s condition before check-in and compare it against the state at move-out; this creates a documented record you can rely on if a dispute arises.
Impact on the 180-day annual limit under the Private Lodging Business Act
Properties operating under a registration with Japan’s Private Lodging Business Act (Minpaku Shinpo) are capped at a maximum of 180 operating days per year. A single long-term booking can eat up 30 to 90 of those days in one go. For instance, accepting two separate 60-night bookings would use up 120 days, leaving you with only 60 operating days for the rest of the year.
To make the most of your 180-day allowance, you’ll need to strategically plan when to accept long-term bookings. Ideally, fill your off-peak season with long-term stays while reserving your peak season for short-term, higher-rate bookings—striking the right balance between the two. Note that properties operating under a Hotel Business Act license aren’t subject to the 180-day cap, so if you want to actively pursue long-term stays, revisiting your license type could also be worth considering.
Tightening your cancellation policy
The impact of a cancelled long-term booking is far greater than that of a short-term one. If a 30-night booking is cancelled just two weeks before check-in, filling that gap with a new reservation is extremely difficult. The resulting lost revenue can easily run into the hundreds of thousands of yen.
Airbnb offers a dedicated cancellation policy specifically for long-term stays (28+ nights). If you select the “Strict” policy, guests won’t receive a refund for the first 30 nights even if they cancel up to 30 days before check-in. If you’re accepting bookings through your own website or directly, be sure to spell out cancellation terms clearly in your contract and get guest agreement in advance.
How to Set Up Long-Term Stay Discounts and Tips for Managing Them
On Airbnb, setting up a discount is as simple as entering your weekly and monthly discount rates in the “Pricing” section of your listing, under “Discounts.” Booking.com works similarly—you can register special long-term rates from the rate plan settings screen. While the setup itself only takes a few minutes, the real key is deciding on the right numbers with the considerations above in mind.
As a practical tip, it’s safest to start with modest discount rates (5–8% weekly, 15–20% monthly) and adjust based on booking response over time. After about three months of data, you’ll have a clearer picture of the optimal discount rate for your specific property. Adjusting your discount rate seasonally is also effective—for example, offering a 30% monthly discount during off-peak season and removing it entirely during peak season. This kind of flexible approach can help you maximize revenue across the full year.
For Questions on Long-Term Stay Discounts or Vacation Rental Management, Contact Stay Buddy Inc.
The ideal approach to long-term stay discounts varies depending on your property’s location, target guest demographic, and cost structure. Even a small change of a few percentage points in your discount rate can shift your monthly profit by tens of thousands of yen, so it’s important to make data-driven, strategic decisions.
Stay Buddy Inc. is a professional vacation rental management company offering one-stop support—from pricing optimization to guest communication, cleaning coordination, and revenue management. Based on a revenue simulation tailored to your specific property, we’ll propose the optimal pricing strategy, including long-term stay discounts.
If you’re looking to maximize revenue while reducing the hassle of day-to-day management, feel free to reach out to Stay Buddy Inc. anytime. Your first consultation is completely free.
