Else Beekman
Owning a holiday home in Spain can be a lucrative venture, as demonstrated by Enrico Persano, a young German entrepreneur who made an astonishing €319,000 in just one summer. His story, shared with Business Insider, highlights the potential profits of the vacation rental market in Spain.
Enrico Persano always harboured ambitions of earning substantial money while enjoying a sense of freedom. Growing up, he felt constrained by the lack of freedom in his vocational training and struggled to make ends meet during his DJ career in Berlin. His fortunes seemed set to change when he ventured into real estate, but the pandemic hit, threatening his new business model. However, Persano was undeterred. He discovered a business model that enabled him to earn nearly €320,000 in just a few months last year, a figure verified by Business Insider. He launched his own company using the Airbnb arbitrage model.
The Airbnb arbitrage Model: Key to success
Persano currently leases properties for the long term on Mallorca and Ibiza, which he then sublets to tourists via platforms like Airbnb, with the explicit consent of the property owners. This model, known as arbitrage, allows him to avoid the high costs of purchasing real estate. Instead, he invests in paying rent over a specified period, recuperates his investment, and makes significant profits by re-renting the properties.
This season, Persano has one property in Mallorca and two in Ibiza. On Mallorca, the villas earn him around €700 per night, while on Ibiza, he can make up to €1,000 per day during the high season.
The numbers speak for themselves
Persano’s approach has yielded a profitable summer. By combining strategic long-term rental contracts with short-term tourist subletting, he has created a successful business model that enables him to achieve significant profits without the high costs associated with purchasing property. His success story underscores the potential profitability of vacation rentals in the Balearic Islands, particularly in popular tourist destinations like Mallorca and Ibiza.
Holiday home rentals in the Balearic islands
The Balearic Islands, renowned for their stunning beaches and vibrant nightlife, continue to attract tourists from around the world. This makes the islands an appealing location for holiday rentals. Platforms like Airbnb have enabled entrepreneurs to capitalise on the growing demand for short-term rentals.
Drawbacks of the growing vacation rental market
Despite the success of entrepreneurs like Persano, the rise of vacation rentals has downsides for local residents. The lucrative short-term rental market has driven up rental prices significantly, making it increasingly difficult for locals to find affordable long-term housing. This dynamic contributes to the growing sentiment of “tourismphobia” on the Balearic Islands, where local communities feel increasingly disadvantaged by the tourist influx and its impact on their daily lives.