New to Real Estate · Fort Lauderdale FL and Sag Harbor, NY · Member since 2022 · 9 posts · 8 votes
Hi All,
I'm currently looking for a property to turn into a midterm rental in 2 different markets.
Both agents I'm working with are investor-friendly, but one has no experience with MTR and the other tells me I can charge 25% more for MTR.
With that pricing strategy, the properties I've looked at so far will actually yield better cashflow as an LTR. For example, one property we looked at would rent for $1100 per unit LT, but around $1300 for MT -- but utilities will be more than $200 per month.
Unfortunately, there aren't any good comps on Furnished Finder. Many of them are a bedroom in an owner-occupied residence or a co-living type situation.
How do you price your midterm rentals? I'm beginning to think I can charge more than 25% extra.
Rental Property Investor · Burlington County, NJ · Member since 2019 · 540 posts · 771 votes
4y
We look at extended stay hotels rates and on Airbnb. With extended stays, we pick the service level at which we seek to compete, e.g. Extended Stay America v Residence Inn by Marriott. On Airbnb, we search in our area for stays of no less than 30 days with all the amenities we offer--location, parking, number of bedrooms, etc. Using all of the data above, we price our offerings at the point in the market where we think our value proposition is the highest. It has worked so far, but we have so few that it's possible we've just been lucky, versus actually skilled, so far. Thus we ask that you take the above information with the appropriate grain of salt.
Investor · Modesto, CA · Member since 2020 · 32 posts · 19 votes
3y
Awesome! Yes, it’s totally just a different way of looking at the Mid Term rental space. It does take a lot more work, but the cool thing about it is that you’re building a house on your own land, whereas Airbnb and Furnished finder are typically waiting around for clients.
There is definitely a way to build a business by connecting with the companies!
Go on some of the travel nurse facebook pages. People are constantly listing their available units so you can start to get a feel for what people are asking and how it compares to your space.
At least in the Boston metro area, I found the prices listed on Furnished Finder (a website used by a lot of traveling nurses) to be unbelievably low, so much lower that I wondered if they weren't mostly fraudulent listings. The prices were lower than equivalent unfurnished long term rentals.
Hi, Carolyn! It seems like it really varies by area. I find that a lot of people using Furnished Finder are just not very knowledgeable. They have a furnished space, they heard about renting to travel nurses, and they list it there having done no research. These are folks who are not part of the "BP universe". While there are many real estate investors starting to get into midterm rentals, a lot of the old crowd has been doing it for a long time but not professionally. For example, I have a friend who started renting out rooms in her house when her kids moved out. She's done it for probably 5 years now. She's not an investor. It's just how she makes her "fun money" to support her mountain biking habit. She also really likes having the company as she's a total people person and being an empty nester was hard on her. So she doesn't really care what she makes on her property and her space and her pricing reflects that. Conversly, I am seeing people who have STRs who have had to pivot either because of regulations or because they just weren't making it as an STR. They're trying to get STR prices with their midterm so they're priced ridiculously high and, subsequently, aren't getting rented. There's this sweet spot right in the middle for the professional investor who has done their homework, knows their market and their guest avatar and prices accordingly. Despite the pitfalls of using FF for market research, without an Airdna-type tool specifically for midterms it's still one of the best ways to research what spaces are going for in your particular market unless you're in a place like where you operate with a particular clientele that tends to use a different lead gen source like you use for traveling academics. The OP may struggle to set midterm pricing because it sounds like she's in a very rural area and has a unique property so there won't be many comps. She's probably going to need to use a variety of sources. She seems very on the ball and is being thorough in her research. Smart lady!