Introduction
Capsule houses are an innovative and affordable real estate investment opportunity. With a low purchase price and high short-term rental demand, they offer an impressive return on investment (ROI). In this analysis, we calculate the ROI when renting a capsule house at 60€/night, targeting a 2-year payback period.
1. Initial Investment
- Capsule house purchase price: 15,000€
- Setup & installation costs: 2,000€ (foundation, utilities, minimal furnishing)
- Total Initial Investment: 17,000€ per unit
2. Revenue Projection at 60€/Night
Short-Term Rental Model
- Nightly rental rate: 60€
- Occupancy rate: 70% (≈ 21 nights per month)
Revenue Calculation
- Monthly Revenue:
- 60€×2160€ \times 2160€×21 nights = 1,260€/month
- Annual Revenue:
- 1,260€×121,260€ \times 121,260€×12 = 15,120€/year
3. Operating Costs
ExpenseMonthly Cost (€)Annual Cost (€)
Cleaning (7.50€ x 21 stays)
160€
1,920€
Utilities (electricity, water, WiFi)
100€
1,200€
Booking platform fees (10%)
126€
1,512€
Maintenance & Repairs
50€
600€
Insurance
30€
360€
Miscellaneous
50€
600€
Total Operating Costs
516€
6,192€
Net Profit Calculation
Net Monthly Profit = Revenue - Operating Costs
= 1,260€ - 516€ = 744€/month
Net Annual Profit = 15,120€ - 6,192€ = 8,928€/year
4. ROI Calculation (2-Year Payback Goal)
To achieve a 2-year payback, we need:
Initial Investment (17,000€)Annual Net Profit (8,928€)=1.9 years≈2 years\frac{\text{Initial Investment (17,000€)}}{\text{Annual Net Profit (8,928€)}} = 1.9 \text{ years} \approx 2 \text{ years}Annual Net Profit (8,928€)Initial Investment (17,000€)=1.9 years≈2 yearsPayback period: 2 years ✅
Annual ROI Calculation
Annual Net Profit (8,928€)Initial Investment (17,000€)×100=52.5%\frac{\text{Annual Net Profit (8,928€)}}{\text{Initial Investment (17,000€)}} \times 100 = 52.5\%Initial Investment (17,000€)Annual Net Profit (8,928€)×100=52.5%This translates to a 52.5% annual return, which is far superior to traditional real estate investments.
5. Scaling the Business
By expanding this model, returns scale significantly:
- 5 capsule houses generate 3,720€/month in net profit.
- 10 capsule houses generate 7,440€/month, providing a strong semi-passive income.
Further Optimization
- Boost occupancy to 80% → Increase net profit by ~1,000€/year per unit
- Direct bookings (reduce platform fees) → Save 1,500€/year per unit
- Upsells (breakfast, tours, rentals) → Add extra revenue per guest
Conclusion
With a nightly rate of 60€, capsule houses achieve a break-even period of 2 years and a 52.5% annual ROI. This investment model offers fast capital recovery, high cash flow, and scalability, making it an ideal opportunity for investors seeking high-yield short-term rental properties.