Are suburbs the sweet spot for mid-term rentals?

Question

I recently heard from an investor who focuses on MTR that some of the best locations for them tend to be suburban areas rather than densely populated urban centers. Never really thought about it that way. Does anyone have any thoughts on that?

Michael Eskenasy · Answer

@Mose Gebremeskel

I’ve noticed something similar, and I think the reason has less to do with “suburbs vs cities” and more to do with who the typical mid-term renter actually is.

A lot of MTR demand comes from people in temporary professional transitions — traveling nurses, insurance adjusters, project managers, relocation situations, people waiting on a home purchase or renovation.

Those tenants usually aren’t optimizing for nightlife or dense urban amenities the way short-term renters might. They’re optimizing for predictability and proximity to where they need to be every day — hospitals, corporate campuses, regional offices, distribution centers, etc.

Those anchors tend to sit in suburban rings rather than downtown cores, which is why you often see MTR perform well in those areas.

The other advantage is that suburban housing stock tends to match the needs of that tenant profile better — parking, quiet neighborhoods, more space, easier logistics for a 2–6 month stay.

So in my mind the key question isn’t “city vs suburb,” it’s where the temporary professional demand clusters in a given market. Once you identify those anchors, the location choice usually becomes pretty obvious.

Ben Scott · Answer

I've found that proximity to hospitals is a key factor for MTRs. Many of the tenants are traveling medical professions and how quick they can get to work

Chase Busick · Answer

@Mose Gebremeskel, I used to have mine in the suburbs of Mid NW Oklahoma City.

Right in between several different medical districts (10-15 mins) from several areas, plus close to the fairgrounds. In my opinion it was great since it was a typical homeowner neighborhood but didn't want to keep all the nice furnishings, so I left them there then did MTR for a couple years, while doing STR in between to fill in the gaps, before converting it to a LTR to a friend that has been there for almost 4 years!

As long as it can cash flow with it being a LTR, then making it a MTR (or STR if want to put in more work) is not as bad... You can hop on both AirBnB & FurnishedFinder (popular for travel professionals) in order to market the listing. This is just ensuring you are getting a good deal in case the MTR biz doesn't work out for whatever reason..

I think that there is a lot of competition in the MTR & STR space, but can still very on the area, location of the property, pricing, condition, amenities, and so much more. In an ethical perspective, are taking a potential LTR or homeowner home off market, that can technically lead to the housing issue most of everyone in the states is facing.. So that's also why I think just ensuring that it cash flows from a LTR then it can be more beneficial, otherwise you will have to figure out some other exit strategies. Ensuring that you still follow prudent principles in leasing out the property still applies.

Are you just wanting all the extra cash flow to include the extra write offs of owning the property?

Mike Paolucci · Answer

Proximity to hosptials is big but there's also insurance companies who need housing. Ask that investor who he's targeting for his tenants and that'll also help figure out just how/why his experiences in the burbs has been so good.

Denise Supplee · Answer

It was horrid! She was what I call a professional tenant. She used everything she could. Finally ended up offering cash for keys and that is how I got her out.

Mose Gebremeskel · Answer

good points!

Mose Gebremeskel · Answer

sounds like you had a really good setup being close to those medical districts. I've been with MTR for 2 years using Furnished Finder. So far, it's been great since I'm househacking. For me, it's mainly been about improving the cash flow compared to traditional LTR.

Denise Supplee · Answer

Hi @Mose Gebremeskel, So nice to meet you. In my 35+ years in real estate; I’m a licensed agent with Long and Foster in PA and have managed my own portfolio and that of others including apartment communities in excess of 200 units. And that includes suburban and city. (Philly). And through those years I have learned it is usually much easier in the suburban locations. Cities tend to be tenant friendly and require a ridiculous amount of red tape like inspections and other things between tenants. And evictions… wow! I had a tenant use the tenant friendly laws and it took me almost two years to evict. I have friend that have had the same experience in Baltimore. Now that doesn’t always mean that suburban is better either, be sure to check with their individual requirements. Now, I only invest passively! Def got landlord burnout. Good luck in all your endeavors!!!

Mose Gebremeskel · Answer

Great to meet you as well! 2 years for an eviction is rough.

Are suburbs the sweet spot for mid-term rentals?

Most Popular Reply