It’s the million-dollar (or rather, million-euro) question for homeowners:
“How much can I earn by renting to tourists?”

The short answer: a lot more than with traditional long-term rentals, especially in a popular destination like Sardinia. But let’s look at realistic figures and the key factors involved. In this article, we’ll compare tourist rentals vs long-term rentals, provide average annual income estimates in several Sardinian locations, and analyze what influences rental income and overall performance.

Tourist rentals vs traditional rentals: is it really worth it?

Is it better to list your property on Airbnb (or similar) than rent it out with a long-term lease (4+4 years) to a resident tenant?
In most cases, yes. Here’s why:

• Higher income:

  Short-term rentals apply a daily rate which, when added up over rented weeks, generally far exceeds a traditional monthly rent. For example, an apartment in Cagliari that would earn €700/month (around €8,400/year) through long-term rental can easily bring in €1,200/month on average with tourist rentals—reaching €12,000–14,000 or more per year.

• Upfront payments, no missed rent:

  Guests pay in advance (via online platforms) and stay only short-term. There's no risk of defaulting tenants or long gaps in payment. Your cash flow is immediate, and you receive your income monthly.

• Flexibility:

  You can choose when to make your home available (just in summer or certain times), and you can use it yourself when you want. With a long-term tenant, the house is occupied all year with no flexibility.

• Maintenance and care:

  It might seem counterintuitive, but with frequent check-ins and check-outs, the home is constantly monitored. Regular cleaning and inspections mean that issues (a leak, a broken appliance) are noticed and fixed quickly, keeping the property in great shape. With a 4+4 lease, you might discover damages years later.

• Tax advantages:

  In Italy, short-term rental income benefits from a flat tax (cedolare secca) of 21%, which is often more favorable than regular income tax (IRPEF) on long-term leases. Plus, there’s no requirement to register contracts under 30 days—saving on stamp duties and registration fees.

The caveat: short-term rentals require more management and are subject to seasonality. You won’t have 100% occupancy year-round like with a permanent tenant (although there are ways to boost off-season occupancy, e.g. monthly rentals to “digital nomads”). To maximize earnings, you may need to invest in attractive furnishings, professional photos, and quality management—either DIY or through a property manager.

Also, while gross income is higher, there are costs to consider: utilities, cleaning, platform and/or management fees.
Conclusion: it’s worthwhile if you have the time—or a good manager—and if the property is in a tourist-friendly location.

Let’s now look at average income figures in some of Sardinia’s top areas.

Average annual income by city and area in Sardinia

Each area has its own potential. Here’s an overview of realistic average annual income that homeowners can expect from short-term rentals in some of Sardinia’s most popular destinations:

• Cagliari (city):

  Around €22,000 per year for a well-managed apartment. Cagliari has year-round activity (thanks to business travel and off-season tourism), with average occupancy around 60%. A long-term rental here would earn around €10,000.

• Olbia:

  Similar to Cagliari, about €22,000/year on average. Due to its proximity to the Costa Smeralda and airport/port, Olbia commands higher rates, though concentrated in summer. The season is slightly shorter than Cagliari’s, but peak weeks in July-August significantly boost income.

• Alghero:

  About €14,000/year on average. A classic tourist destination, Alghero shares a similar market to Olbia: huge summer demand (helped by low-cost flights) and a calmer off-season. Prices are high—around €150/night. A traditional rental here might bring in €600/month (€7,200/year), less than half the short-term potential.

• Villasimius:

  Around €40,000/year on average. Despite being a small seasonal town (mostly summer), Villasimius sees some of the highest earnings, thanks to high daily rates and strong beach appeal. Most of the money is made in 3–4 summer months, balancing out the low off-season.

• Costa Smeralda (Porto Cervo, Porto Rotondo, Arzachena…):

  Typically €60,000 or more per year for mid-high level properties. This is the premium market: luxury villas and apartments that can earn six figures in just a few summer months. In the real Costa Smeralda, many high-end villas exceed €100,000 per season.
  Of course, management costs here are also higher (luxury services, concierge, etc.), but so are the returns.

Note: These are average estimates based on recent market data. Your property might earn more or less depending on various factors. For example, a stylish three-room apartment in central Cagliari could exceed €30,000/year.

The good news: With the right management, you can beat the averages!

Factors that influence short-term rental income

Not all properties earn the same—even in the same area. These are the main factors that affect your earnings:

• Seasonality:

  In Sardinia, summer is the peak season. Coastal towns can generate 70–80% of yearly revenue between June and September. Cities like Cagliari have more consistent flows throughout the year. Renting during off-season months (possibly with discounts or monthly stays in winter) can raise overall income.

• Location:

  Location, location, location! A beachfront property or one in the tourist historic center can charge higher rates and attract more guests. On the other hand, a property in a rural inland village or far from attractions will face lower demand and prices. Even within the same city: in Alghero, the historic center outperforms the outskirts; in Olbia, an average apartment earns less than a villa in Porto Cervo.

• Type and features of the property:

  The home’s features matter. Examples: air conditioning is a must in Sardinia. A private pool or panoramic sea view greatly increases nightly rates.
  Bed capacity matters too: a villa for 8 people can earn more (as families or groups share the cost) than a studio for couples. Fast Wi-Fi, private parking, a well-equipped kitchen, and a BBQ are attractive extras that increase bookings or justify higher prices.

• Management and marketing:

  Behind strong numbers is usually professional management. High-quality photos, multilingual listings, fast and professional replies to inquiries (hosts who reply within 1 hour get more bookings than those who reply in 24h), and excellent reviews (thanks to great hospitality)—all these boost occupancy and average rates.
  Identical homes can have different returns depending on how they’re managed. For instance, property managers who constantly analyze the market, use dynamic pricing, and run promotions will greatly outperform owners who just pick a flat rate or set prices “by gut feeling.”

Understanding these factors helps you identify where to improve to boost earnings. Some things can’t be changed (like location), but others can: improving your home and amenities, hiring professionals, targeting new guest types for the off-season, etc.

Want personalized numbers for your property?

The BAYA Rentals Team offers a free consultation where we’ll analyze your property in detail.
We’ll assess the location (tourist demand, competition), type of accommodation, and apply our local market expertise to estimate your potential annual income range. Not only that—we’ll recommend improvements to increase perceived value.

In Sardinia, every vacation home is unique. But with the right data and good management, you can turn your property into a strong, sustainable income stream.

Curious about your property’s potential?

Contact us for a free personalized assessment.

The tourism market in Sardinia is growing—as is demand for short-term rentals.
Take advantage of this opportunity!