Medium Term Rentals

[Braeden Cobb]

Hey everyone, I would like to hear some strategies on medium long term rentals that people have had success and/or difficulties with. I am in a market where the cooler months do very well and the hot months are slow so I am debating on getting a home and doing mtr for 6-8 months and then str for 4-6 months. Has anyone has success doing this? 

[Michael Warthen]

As a Phoenix resident I have had similar thoughts about MTR. I was wondering if close to a hospital, the months won't matter as hospitals will still have to have staff during hot months. Hopefully you get some responses!

[Colleen F.]

@Braeden Cobb this is something alot of people get into the idea of but it really doesn't make STR money. Demand has fallen off with the decrease in covid nursing contracts are paying less although there is always demand. I have only one unit in this space so I can't comment too much but that is what I see in the nursing FB groups.

@Michael Warthen I was considering demand in phoenix as I have a home here that I only occupy part time but I think the hospital demand may coincide with the winter months when there are more residents in the area.  A lot also depends on where the hospitals are offering the best money. 

[Joshua Messinger]

Hey @Braeden Cobb! 

That's generally the expectation of what you would exactly want to do. But, I would only take it as it comes along and focus on one strategy at a time. This way you can focus on buying in the right location so it performs the best-doing one of the strategies and you always have the other strategy in your back pocket. 

Hope this helps! Don't hesitate to reach out if you have any more questions.

-

Josh

[Sean Bozigian]

Hey @Braeden Cobb 

I work with many STR, MTR, and LTR clients in Scottsdale and have a pretty good pulse on all of these markets. In theory, MTR makes a lot of sense - you can increase your revenues compared to LTR without the management of STR.

Now some of the headwinds to look out for:

- Increased competition - Many STR operators are struggling right now. Occupancy rates are down and expenses... well... aren't. I anticipate that before settling for a LTR or listing, many owners are going to explore the MTR option, creating a surplus of inventory. That combined with traveling professional demand declining could spell trouble.

- Risk of vacancy - What gets overlooked with this option a bit is that a small vacancy (even 1 month in many cases) can erase any monetary upside when compared to a 12 month lease. Even a 2 week vacancy in between tenants can tighten that gap to the point where a LTR may make more sense. This coupled with the above point make my a little weary. 

Feel free to send me a message if you want to set up a time to discuss a little more in depth, or talk some different options. Hopefully this helps you out a bit!

[Laura Shinkle]

@Braeden Cobb sorry I'm a bit late to the party on this one. I assume you're on Airbnb, so anyone looking for a longer term housing is likely on that site as well. 

One thing is you could advertise a discount for a longer term tenant (your choice on the length). 

The biggest site for MTR is Furnished Finder. If anyone else has a good site for those rentals, let me know! Take a look at the site and see how you could stand apart from what's on there. Most of the ones in my area have terrible pictures and little details. 

For myself, I personally treat the tenants like a LTR in that I get a background/credit check and have them sign a lease agreement specifying the furnishes included in the home. That is a different process than an Airbnb. Additionally, your state may have specific laws on security deposits, etc. Check those out. 

I don't see why you couldn't advertise on both at the same time, see how that goes. 

As mentioned, I think a lot of investors are going to head that way. Just find a way to make yours stand out, and I think you'll be just fine!