How do I know if my property is suitable for short-term rentals?

In recent years, short-term rentals have become a growing trend in the real estate market, especially in tourist and urban markets. This rental model, characterized by the possibility of generating additional income in short periods of time, has caught the attention of both owners and travelers. Investing in short-term rental properties is an increasingly popular strategy, and cities such as Medellín, which has experienced exponential growth as a tourist destination, represent a great investment opportunity. We'll tell you how to know if your property is suitable for short-term rentals.

How has the short-term rental market performed in Medellín?

In 2023, the real estate market experienced a series of critical factors that led to a significant increase in rental prices. The decline in housing construction, delays in apartment deliveries, and a demographic shift with more people living alone or in smaller households contributed to a shortage of available housing. In addition, the increase in foreigners, including digital nomads, increased the demand for rental apartments in Medellín, while the supply of traditional housing decreased due to migration to more lucrative short-term rentals.

However, this year the situation has begun to stabilize. The supply of rental housing has returned to 2021 levels, and although rental prices increased by 6.3%, they did so below inflation, showing a moderation compared to previous years' increases.

A key indicator that the city is declining in terms of short-term rentals is the 10.9% decrease in the supply of tourist accommodation this year. Compared to December 2023, when there were 12,200 properties available, in 2024 this figure has fallen to 10,873. According to Federico Estrada, manager of the Medellín and Antioquia Real Estate Exchange, this decline has helped to ease pressure on the supply of traditional rental housing.

How do I know if my property is suitable for short-term rentals?

For those who wish to invest in short-term rentals, it is important to understand that not all properties are authorized, and operating outside the law not only puts the investment at risk, but can also lead to severe penalties, such as heavy fines or even a ban on continuing the activity. For this reason, it is crucial to know and comply with the legal requirements governing this sector.

According to Federico Estrada, manager of the Medellín and Antioquia Real Estate Exchange, current regulations establish that tourist accommodation in residential units is only legal under three conditions: