Midterm Rentals — What is working for you right now?

Question

There's definitely increased interest in mid-term rentals in my market - St Louis.

I’m seeing more investors explore it especially around our 2 major hospital systems, but not every property works just because it’s “midterm.”

What I’m seeing do best here.

• 2 (up to 3 but 2s are more affordable) bedrooms near BJC / WashU / SLU
• Central Corridor + select inner-ring county pockets
• Easy parking- preferrably off street 
• Fenced yard (a lot of travel nurses bring small dogs)
• Functional + cute — think Pinterest-ready, not luxury

It doesn’t need high-end finishes. It needs to photograph well, feel safe, and feel easy.

Where I see investors miss: Trying to force gentrifying areas for yield, risking property rejection, over-improving.and underestimating vacancy.

The operators doing well are underwriting conservatively and designing for lifestyle — not just cash flow.  Yes, low to even zero vacancy is possible but of course you cannot bank on it.

Curious what others are seeing.    Are you leaning into midterm long-term, or using it as a flexible strategy? - In other words does the deal need to pencil as LTR?

Kenneth Garrett · Answer

@Alicia Sierra

I’m in a military and health care area.  Two military bases near by. Lots of training for military members (TDY).  Stays lately have been 5+ months.  I’m looking to add my portfolio.

Spence W. · Answer

I completely agree with your point about investors missing by trying to force yield in gentrifying areas. I'm an out-of-state investor based in NYC, and I see this constantly while researching Midwest markets like Kansas City and Indianapolis.

People chase high on-paper returns in transitioning neighborhoods without checking the underlying data. When I pull county assessor records on some of these "high yield" listings, I frequently find major square footage discrepancies or unpermitted additions listed as extra bedrooms. Sometimes they are even sitting a block away from an EPA Superfund site with zero disclosure.

Because of that information asymmetry, I always underwrite to make sure the deal pencils as a standard LTR first. The midterm premium has to be just a bonus. Have you noticed any specific red flags in St. Louis public records that tend to pop up in those riskier gentrifying areas?

Alicia Sierra · Answer

At times there are discrepancies in the public records -but it's more the experience of the location and surrounding areas (how many homes looked distressed? how congested is the block? how close in reality is it to the more walkable areas? )  That's why we take super detailed video that includes coming and going for our clients and explicitly address perception.

I often tell investors you have to buy for the broadest audience - not just the 'urban' guest. Some of the areas may be super comfortable for some, but uncomfortable for others.  So we caution them on the risk of rejection.

Kenneth Garrett · Answer

The needs are similar when they are coming for training with their families.  Unfortunately, haven’t had the same reaction for healthcare workers.  They typically are just one.  I would be open to multiple health care workers to make the numbers work.  It’s a 3 bedroom 2 bath house.

Alicia Sierra · Answer

Nice.  Do you find that the needs are similar for that target tenant - versus travel nurses/ academic etc?

Midterm Rentals — What is working for you right now?

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