Serviced Apartments Are Outperforming Hotels for UK Business Travel - and London Supply Just Rose 11%

A Rare Window Is Opening for London Landlords

If you've been watching the London rental market closely, you'll have noticed something interesting happening this spring. Foxtons reported that rental supply in the capital jumped 11% between February and March 2026, flooding the market with newly available properties just as the Renters' Rights Act continues to reshape the traditional lettings landscape.

At the same time, fresh data from Housd and Savills reveals that serviced apartments are now outperforming hotels as the preferred accommodation for UK business travel. Corporate travellers are choosing fully equipped apartments over hotel rooms for longer stays, citing better value, more space, and a more productive working environment.

These two trends are colliding to create a once-in-a-cycle repositioning opportunity. If you're a London landlord sitting on a vacant unit, you have a strategic choice to make: re-let on a periodic tenancy under the new regulatory framework, or pivot into the booming corporate serviced accommodation segment.

Let's explore what that pivot actually looks like in practice.

Why Corporate Serviced Apartments Are Booming

The business travel recovery in the UK has been steady, but the way companies book accommodation has shifted dramatically. Employers are under pressure to manage travel budgets more carefully, and serviced apartments offer significant savings over hotels for stays of a week or longer. Add in amenities like kitchens, laundry, and dedicated workspaces, and it's easy to see why corporate travel managers prefer them.

According to the Housd report, nightly rates for serviced apartments in London remain competitive with mid-range hotels, while occupancy rates for well-managed units are consistently strong. For landlords, this translates to potentially higher gross yields than traditional assured shorthold tenancies, especially in central and well-connected London postcodes.

The Operational Reality of Self-Managing a Corporate SA Unit

Before you rush to list your property on a corporate booking platform, it's worth understanding exactly what's involved. Running a serviced apartment for business travellers is a hospitality operation, not a passive investment. Here's what you'll need to manage.

Guest Vetting and Corporate Bookings

Corporate clients expect a professional booking experience. You'll need to register on platforms like SilverDoor, SACO, or Housd, many of which require a minimum quality standard and verified property listings. Vetting individual guests, handling corporate invoicing, and managing booking amendments all take time and attention to detail.

VAT Registration

This is where many landlords get caught out. Serviced accommodation is treated as a taxable supply for VAT purposes in the UK. If your turnover from SA income exceeds the VAT threshold (currently £90,000), you'll need to register. Even below the threshold, you may want to voluntarily register to reclaim VAT on furnishing and setup costs. Either way, you'll need proper accounting systems in place.

Cleaning Turnovers and Maintenance

Business guests expect hotel-standard cleanliness on every arrival. That means professional linen, thorough deep cleans between guests, and a reliable team who can turn a property around in just a few hours. When your calendar is full, you might be coordinating multiple turnovers per week.

Insurance and Compliance

Standard buy-to-let insurance won't cover serviced accommodation. You'll need specialist short-term let insurance that covers guest injuries, property damage, and loss of income. You should also check that your lease, mortgage, and local council planning rules all permit short-term letting.

Pricing and Revenue Management

Corporate demand fluctuates seasonally and is sensitive to events, conferences, and economic cycles. Maximising occupancy and yield requires dynamic pricing strategies, something that takes both data and experience to get right.

The Self-Management Trap

Here's the honest truth. Many landlords who start self-managing a serviced apartment underestimate the workload and overestimate the simplicity. What looks like a straightforward upgrade from traditional letting quickly becomes a second job. Between guest communications, cleaning coordination, platform management, compliance checks, and accounting, you can easily spend 15 to 20 hours per week on a single unit.

The yields can be excellent, but only if the operation runs smoothly. One bad review from a corporate guest, one missed cleaning, or one compliance slip can damage your listing's performance for months.

The Smarter Route: Professional Short-Term Let Management

This is exactly why more London landlords are choosing to outsource the entire operation to a specialist management company like Airhosts. Instead of juggling every element yourself, you get the high yields of serviced accommodation with the simplicity of a fully managed service.

A professional manager handles everything: listing optimisation, dynamic pricing, guest vetting, 24/7 communication, cleaning and linen, maintenance, compliance, and financial reporting. You receive your income each month without lifting a finger.

The difference in returns can be significant too. At Airhosts, our London portfolio consistently outperforms traditional rental yields because we combine corporate and leisure demand, optimise pricing daily, and maintain the five-star guest experience that drives repeat bookings and strong reviews.

Compare that with the traditional letting route under the Renters' Rights Act, where periodic tenancies, removal of Section 21, and enhanced tenant protections mean longer void periods, more complex eviction processes, and less flexibility. For many landlords, the risk-adjusted return on a professionally managed short-term let is simply better.

What London Landlords Should Do Right Now

The 11% supply increase means competition in the traditional rental market is heating up. Rents may soften, void periods may lengthen, and landlords who don't adapt could see their returns squeezed.

Meanwhile, corporate demand for serviced apartments continues to grow, and there is a genuine supply gap in London for high-quality, professionally managed units. The landlords who reposition now, while this window is open, stand to benefit the most.

Whether your property is in Zone 1 or in a well-connected outer borough, it's worth exploring whether serviced accommodation could deliver stronger returns than a traditional let.

Your Next Step

If you're a London landlord with a vacant or underperforming property, now is the time to act. Airhosts specialises in turning London properties into high-performing, fully managed short-term lets that capture both corporate and leisure demand. We handle every detail so you don't have to, and our landlords consistently earn more than they would through traditional lettings.

Get in touch with our team today for a free property assessment and find out exactly what your property could earn. The repositioning window won't stay open forever.