Guide
Renovation for Airbnb and Premium Rentals in Madrid: How to Design for Return
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A renovated apartment for Airbnb in Madrid is not a renovated apartment to live in. The decisions are different, the materials are different, the logic of the distribution is different. And if it is designed as if it were for own use, the return is lower than it could be.
Madrid is one of the most competitive tourist rental markets in Europe. The difference between an apartment that achieves high occupancy at a premium rate and one that competes on price alone is not in the location or square footage. It is in the design.
What the premium rate traveler looks for in Madrid
The traveler who pays 150 euros or more per night in an apartment in Madrid has seen many apartments. He knows how to distinguish a refurbished apartment with criteria from a refurbished one with the minimum to go on the market. And he decides in the first three seconds of seeing the photos of the ad.
What you are looking for is not luxury in the sense of expensive materials or flashy decoration. He is looking for coherence: that the whole apartment communicates the same thing, that there are no neat areas next to clearly neglected areas, that the materials have a logic between them. A coherent apartment conveys that someone thought about it with criteria, and that generates confidence before the guest arrives.
You're also looking for functionality without friction. That the kitchen has what you need where you expect it. That the bathroom works well and looks good. That there is space to work if you need it. That the lighting is sufficient and well placed. None of these things are expensive. They all require someone to have thought of them before the work begins.
The most common design mistakes in renovations for Airbnb
Design for one's own taste rather than for the target guest. An owner renovating his apartment tends to choose what he likes. The problem is that the guest may have a different taste, and in the tourist rental market neutrality works better than strong personality. An apartment with a strong aesthetic appeals to a narrow segment. An apartment with a clean, consistent aesthetic appeals to a broad segment.
Materials that do not withstand intensive use. An Airbnb apartment in Madrid can receive 20 different groups of guests in a month. Floors, countertops, bathrooms, and appliances receive a use that no regular home receives. The materials chosen for that use have to be more resistant and easier to clean than those that would be chosen for personal use.
Insufficient or poorly located lighting. The photos of the apartment are the first purchase decision of the guest. An apartment with good lighting photographs well and gets booked more. A dark apartment or one with poorly placed light points photographs poorly even if everything else is fine.
How much the return improves with market-driven design
In Madrid's tourist rental market, an apartment with a medium-high level design gets rates between 25% and 45% higher than a renovated apartment without criteria, in the same area and with the same square meters. Occupancy is also higher because the photos are better and guest reviews are higher.
The additional investment in design over a basic refurbishment is typically recovered between the third and sixth month of operation, depending on the average rate and occupancy. After that point, the rate differential is additional net profit each month.
For premium long-term rental, the logic is similar although the terms are different. A well-designed apartment in Madrid can justify rents between 20% and 35% higher than the same space without intervention, and attracts a tenant profile with greater economic stability and lower turnover.
How Eolos works with residential investment renovation projects
The starting point is the objective of the asset: Airbnb, mid-stay rental, long-term rental, or sale. Each objective has different design criteria and produces different investment decisions.
Eolos is managed by COAM registered architects with more than 20 years of experience in projects in Spain, Sweden and Greece. We work with owners and investors who have a property in Madrid and want to maximize their return with a well thought out refurbishment. If you have an apartment that you want to put on the tourist or premium rental market, tell us the situation. The form is below.