We're considering a SFH investment property in the Park Circle area. Just looking for someone's expertise if this would be better to rent long term, as this area seems to attract young families or would we be able to rent more mid-term. This area isn't cheap so don't want to risk a place sitting for months. Any insights are appreciated. - Andrew
Lender · Asheville, NC · Member since 2016 · 1k+ posts · 1k+ votes
2y
Have you run any numbers yet? This is a pretty broad question and the answer is always going to be very area specific. Start by finding an investor friendly Realtor. It's really critical that you work with someone who understands investing and the strategies you're trying to deploy. Your average Realtor who sells primary homes is not going to be a good resource for you. Then consult some sources to understand what your LTR rents might be. A lot of people use Zillow, Rentometer, Realtor.com, apartments.com or just call a local property management company. If you're running the numbers as a midterm rental, I recommend you start by looking at properties listed on Furnished Finder and also look for 30+ day stays on Airbnb as a starting point. This will give you some idea of what you could possibly make. Since you said it's not cheap and can't afford to have it sit vacant for months, you really want to be thorough in your underwriting.
It depends on your goals and what you value. LTR may get less money but management (if doing it yourself or hiring someone) is minimal for 6,9,12 months; plus you do not have the upfront costs of furnishing the space. MTR is a hospitality business, similar to the STR, more upfront cash, you are being thoughtful and intentional around how you present, offer, and welcome guests on the front end, plus the same leasing, monthly payments, maintenances requests as a LTR; but you a get a more money monthly. Both are different, one gets less money but less time/hospitality/upfront costs; another gets more money, with more effort, more hospitality, being more available for guests upfront, plus extra expenses on the front end. Just wanted to provide a different perspective, happy to chat more.
Lender · Asheville, NC · Member since 2016 · 1k+ posts · 1k+ votes
2y
Have you run any numbers yet? This is a pretty broad question and the answer is always going to be very area specific. Start by finding an investor friendly Realtor. It's really critical that you work with someone who understands investing and the strategies you're trying to deploy. Your average Realtor who sells primary homes is not going to be a good resource for you. Then consult some sources to understand what your LTR rents might be. A lot of people use Zillow, Rentometer, Realtor.com, apartments.com or just call a local property management company. If you're running the numbers as a midterm rental, I recommend you start by looking at properties listed on Furnished Finder and also look for 30+ day stays on Airbnb as a starting point. This will give you some idea of what you could possibly make. Since you said it's not cheap and can't afford to have it sit vacant for months, you really want to be thorough in your underwriting.
Unless you're in an area that just doesn't appeal to medium-term renters (say a remote property away from any city amenities), then you're always going to make a little more as a midterm rental than a LTR. How much more?
For our MTRs in Denver and Colorado Springs, we see about 1.4x rents for MTR v LTR. If there's decent demand, you should be fine keeping occupancy high. (We've been 95% occupied for our units for the last several years.) You just make sure you start advertising early enough -- usually for us about 1.5 months before the tenant will leave.
If you're looking for MTR resources, @Erin Spradlin's books are great -- Erin's Guide to Midterm Rentals, American Nomads, and My First Rental Workbook: Midterm Edition.
We just finished a single/multifamily neighborhood in park circle last year. Our 1500 square foot townhomes are now listing in the low $400s sold them at low $300. Single family listings are mid $400s to high $600s. This development is 1/4 mile from the circle. Renting is no problem! Rents are running from $2750 and up. You may want to consider going about a mile or two from the circle. Less desirable neighborhood but in-filling quickly. A lot less cheaper and will command the same rental rate if purchasing and renovating is an option for you. Not to mention the equity you will have in it when fully renovated. I rented on park circle 20 years ago and had the option to buy a home for 75k when the crime rate in the area was high. Home sold last year for 365k and was not renovated.
Real Estate Agent · Charleston, SC · Member since 2023 · 26 posts · 4 votes
2y
You should look at the numbers carefully. Rentals in PC are popular, whether short or long term. I think the less risky is a long term, but there are plenty of travel nurses that come through who would gladly do a short term (furnished, so something to consider) and won't wreck your place. Glad to connect!