Shortlets vs Hotels: Which Makes More Financial Sense in 2025?

When people search “shortlets vs hotels”, the real question behind it is simple: Which option saves money, and which one helps you earn more?

The answer depends on whether you’re a traveler trying to cut costs or an investor trying to maximize returns.

This blog breaks down the financial difference clearly so you can decide where the money truly makes sense in 2025.

What Really Makes a Shortlet Different From a Hotel?

Before comparing which one is more profitable, you need to understand the structure.

A hotel is a hospitality business designed for short stays with standardized services (room service, concierge, housekeeping, etc.).

A shortlet, on the other hand, is a furnished residential apartment rented for days, weeks, or months. Platforms like Airbnb and local Lagos agents have made shortlets mainstream, especially for travelers who want comfort, privacy, and a “home feel.”

So, when we compare shortlets vs hotels, the first major difference is cost structure for both the guest and the host.

For Guests: Which Option Costs Less?

Here’s how people calculate value when searching shortlets vs hotels:

1. Daily Cost

When you compare shortlets vs hotels in Lagos today, the pricing difference becomes clearer when you look at actual numbers from recent market reports.

Most hotels in high-demand areas like Lekki, Victoria Island, and Ikeja GRA charge premium rates per night, especially for standard rooms. Meanwhile, shortlets offer more flexible and often more affordable pricing especially when more than one person is staying.

Let’s look at the numbers:

• According to the Nairametrics 2024 Short-Term Rental Market Review, a 1-bedroom shortlet in Lagos typically costs ₦50,000 to ₦100,000 per night, depending on the location and furnishing quality.
  
  Source: Nairametrics Short-Term Rental Report, 2024.
  
• For hotels, various listings on major platforms (Booking.com, Hotels.ng, and Travelstart) show that mid-range hotels in Lekki and VI usually fall between ₦70,000 and ₦120,000 per night, with higher rates during weekends or peak seasons.
  
• Airbtics’ Lagos analysis shows an average daily rate (ADR) of $68 (approx. ₦90,000) for shortlets, while hotels in premium districts often surpass that figure due to additional service charges.
  
  Source: Airbtics Lagos Market Data 2024–2025.
  

So in reality:

• Hotels: generally ₦70,000–₦120,000 per night for 2 guests, depending on class and season.
  
• 1-bedroom shortlets: commonly ₦50,000–₦100,000 per night, but can host 2–3 people, making the cost per head lower.
  

Shortlets also allow guests to cook, work, entertain, and enjoy more space, so the value per night often feels higher compared to a standard hotel room.

2. Extra Charges

Hotels add taxes, service fees, food costs, and sometimes parking fees.

Shortlets usually operate with one upfront price.

3. Space & Convenience

Hotels give you a room.

Shortlets give you a whole apartment such as kitchen, living room, workspace.

This is why families, remote workers, and long-stay guests often choose shortlets over hotels.

From a guest’s perspective, shortlets usually make more financial sense, especially for long stays or group travel.

For Investors: Which Delivers Higher Returns?

When comparing shortlets vs hotels from an investor viewpoint, the numbers become even clearer.

Hotels

• Require huge startup capital
  
• Need licenses, branding, large staff, and ongoing operation costs
  
• High risk if occupancy drops
  
• Best for corporate-level investors or developers
  

Shortlets

• You can start with one apartment
  
• Setup cost is much lower
  
• Register on platforms like Airbnb
  
• Management can be outsourced
  
• High occupancy during peak seasons in Lagos (December–April)
  

A well-managed shortlet in Lagos can earn:

• ₦60,000–₦200,000 per night
  
• 60–90% occupancy during peak months
  
• 20–40% Return on Investment yearly, depending on location and furnishing
  

Hotels generally offer slower ROI because their cost structure is heavy. Shortlets, on the other hand, are agile and easy to scale.

So from an investor standpoint, shortlets make more financial sense especially in Lagos where demand is rising. Over the past three years, the short-let market in Lagos grew by 263%, according to Estate Intel.

We wrote an article on how you can use the shortlet framework to earn from your apartment this December.

Read it here

Why Shortlets Are Dominating Lagos

Search trends show more people comparing shortlets vs hotels because the market is shifting.

Travelers want privacy, digital nomads want workspace, families want more space, and Nigerians returning home want convenience without the cost of multiple hotel rooms.

Shortlets provide:

• Flexible pricing
  
• Full apartment spaces
  
• Fast check-in
  
• A lifestyle experience
  
• Better long-stay value
  

This rising preference naturally increases profitability for shortlet owners.

In case you want to understand the MREIF MORTGAGE in Nigeria, here is an article to help.

Read it here.

But Hotels Still Have Their Strengths

To make the comparison balanced, here’s what hotels offer better:

• Standardized service
  
• Guaranteed security
  
• Daily cleaning
  
• Luxury amenities
  
• Predictability for corporate travelers
  

For quick one-night stays, hotels may still make more financial sense, especially for business travelers who want structured service.

Conclusion

After seeing all the numbers, growth data, and real-life potential, the question isn’t just which is more profitable. Rather, Which makes more financial sense to you?

• If you’re investing, shortlets may offer higher returns, faster growth, and more flexibility than running a hotel.
  
• If you’re a traveler or guest, shortlets could save you money for long stays or give you more space than a standard hotel.
  
• But hotels still offer convenience, service, and stability especially for short stays or business trips.
  

So, after going through this article: which do you think makes more financial sense, shortlets or hotels?