What Is A Serviced Apartment? The Main Differences With A Hotel in 2024

Investing in a serviced apartment can be a great strategy to diversify your real estate portfolio and enhance cash flows.

This property type merges the autonomy of apartment living with the customer appeal of hotel amenities – resulting in a potentially lucrative investment.

By mastering the essence of serviced apartments, you could outpace the traditional hotel sector with a model that caters to the modern traveler’s desire for space and service.

The goal of this article is to provide you with the insights needed to make an informed decision about whether to invest in or operate a serviced apartment.

What Is A Serviced Apartment?

A serviced apartment is a property where the comforts of home meet the finesse of a hotel! These fully furnished apartments (a block together is called an apartment hotel) offer the space to spread out, the gear to prepare own meals, and offer most of the times more space than a standard hotel room. It’s perfect for guests that fancy a homey feel during a stay.

Reasons You Need to Know The Differences Between A Serviced Apartment And Hotel

Why do you have to know the differences? Because, unlike hotels, serviced apartments provide the keys to a more spacious and personalized stay.

Ditching the one-size-fits-all approach of traditional hotels, these pads let your guests live like locals – complete their own kitchen and living room, providing a taste of the city beyond the tourist traps.

Differences Between A Serviced Apartment And Hotel

A serviced apartment offers more than just a temporary roof over your head—it’s a blend of home-like amenities and hotel-like services tailored for longer stays. Let’s delve into the six fundamental differences that set them apart from hotels.

1. Space And Layout

Serviced apartments offer significantly more space compared to traditional hotel rooms, providing guests with separate living, dining, and sleeping areas.

Unlike a typical hotel room, a serviced apartment often comes as a fully furnished apartment, designed to feel like a home away from home.

This contrast in space and layout means guests in serviced apartments can enjoy a more comfortable and expansive living environment, something that hotels cannot match.

2. Duration Of Stay

Serviced apartments cater to a variety of stay durations, from short-term visits to long-term residencies. This flexibility is a distinct advantage over hotels, which are typically geared towards shorter stays.

The adaptability of serviced apartments makes them an ideal choice for travelers who require accommodations for extended periods, offering the comforts of home for weeks or even months at a time, whereas hotels are mostly designed with brief visits in mind.

3. Amenities and Services

Serviced apartments offer a unique set of amenities aimed at long-term comfort, such a fully equipped kitchen and in-suite laundry facilities, contrasting with the daily housekeeping and room service found in hotels.

While hotel rooms provide a level of convenience and luxury (think of a fitness center, swimming pools, room service and other amenities), serviced apartments cater to those seeking the practicalities of home life.

This distinction ensures that a serviced apartment offers a living experience that can be tailored to personal habits and lifestyles, diverging from the uniform services provided by traditional hotel rooms.

4. Cost-Effectiveness for Extended Stays

For longer stays, serviced apartments are a more economical choice due to their lower rental price and the inclusion of home-like amenities that allow for self-sufficiency.

In contrast, the cost of staying in a hotel remains relatively constant, regardless of the length of stay, potentially leading to higher overall expenses due to the need for dining out and other services.

Serviced apartments offer the financial advantage of a single, consolidated cost that covers all living expenses, making them a good option to save money for extended visits.

5. Privacy and Personalization

The private, home-like environment of serviced apartments stands in stark contrast to the more public setting of hotels.

With features that allow for a personalized living space, serviced apartments offer guests the ability to maintain their routines and lifestyles, something not easily achieved in the standardized setting of a hotel room.

This level of privacy and personalization ensures that those staying in serviced apartments can enjoy a sense of normalcy and comfort, distinct from the transient nature of hotels.

6. Location and Integration

Serviced apartments often sit nestled in residential neighborhoods, providing a different setting than hotels, which are commonly anchored in busy tourist and business districts.

From an investing point of view, this positioning of serviced apartments often results in lower overhead costs compared to city center locations.

For guests, it translates to quieter surroundings and typically more space, including access to local amenities that might not be found in commercial areas where hotels dominate.

Key Considerations For Successfully Operating a Serviced Apartment

To successfully run a serviced apartment, focus on providing all the comforts of home, which is what sets them apart from standard accommodations.

Efficient check-in procedures, consistent quality, and responsive guest services are non-negotiable. Ensure that the space is not only functional but also appealing, reflecting a homely warmth that resonates with guests seeking a personal touch in their travels.

Taking it to the Next Level: How To Start A Serviced Apartment Business?

Starting a serviced apartment (i.e. serviced accommodation) business means extensive up-front due diligence and making well-calculated investment choices.

Conduct thorough market research, secure a prime location, and align with legal and hospitality standards to lay a solid foundation for your venture.

Make sure the properties you offer are top-notch, from a smooth check-in process to high-speed internet to a fully equipped kitchen and a luxury living room. Think through what fully equipped means in a home setting.

Alternatives To Serviced Apartments

From an investment perspective, alternatives to serviced apartments could include traditional rental properties or vacation rentals.

Each strategy diversifies risk and offers different returns. Traditional rentals may yield steady income over time, while vacation rentals can capitalize on short-term market fluctuations.

Wrapping Up and My Experience With Serviced Apartments

Investing in serviced apartments can be a highly profitable investment strategy! Serviced apartments meet a clear market demand, combining home comfort with hotel amenities and therefore appealing to both short- and long-term guests.

In case you want to know more and check out the steps to follow to set up your first serviced apartment, make sure to read this article.