Are mid-term rentals outperforming traditional rentals in your market? If so, how?

Question

I’ve been seeing more investors shift toward mid-term rentals for travel nurses, corporate housing, and temporary relocation stays because of the balance between cash flow and lower turnover compared to short-term rentals.
For those currently operating mid-term rentals, what's been your biggest advantage or challenge so far? Are you seeing a shift from LTR / STR to MTR lately? If so, what do you feel is the cause of that change? Is it the economy or something else?

Stephen Delahoussaye · Answer

Great question. I manage LTR doors in Nashville and also work the brokerage side so I see this from multiple angles.

In Nashville the MTR market has definitely grown, especially with the healthcare corridor. We have a ton of travel nurses rotating through Vanderbilt, TriStar, and the surrounding hospital systems. There's also a steady stream of corporate relocations with all the companies that have moved here over the last few years. So the demand side is real.

That said, I still think LTR is the backbone for most investors and here's why. The consistency is hard to beat. A solid long term tenant paying market rent with a good lease in place gives you predictable cash flow without the turnover costs and management intensity of MTR. Every time an MTR tenant rotates out you're re-furnishing, re-cleaning, re-marketing, and eating vacancy days. Those costs add up fast and can eat into the premium rent you're charging.

Where I see MTR making sense in Nashville is specific situations. Units near hospitals or major employers with documented rotation programs. Furnished units in walkable neighborhoods like East Nashville or Germantown where corporate tenants want a landing pad. Properties that are already struggling to hit market rent on a 12 month lease but could command a premium furnished for 3 to 6 months.

The biggest challenge from the management side is that MTR falls in this awkward middle ground. It needs more attention than a standard LTR but doesn't generate the per night revenue of a true STR. You really need to nail your systems if you're going to scale it. For most investors I work with, a well managed LTR portfolio still wins on risk adjusted returns over time.

R. Elle Berry · Answer

Ralph, my apologies for the delay. This is an interesting approach. I think many investors focus only on STR vs. LTR, while niche housing models like workforce, 55+, and sober living often get overlooked. The higher revenue potential is attractive, but operator experience and local regulations seem to be the key factors in making the numbers work. Thanks for sharing.

Kenneth Garrett · Answer

@Ashley Bitner

I’ve found military members multiple ways.  The sources are typically Zillow, Furnished Finder and Fox3 Lodging/TDY Hero and I’m on the local military sites.  It works pretty well, but I’m always exploring other options.  There are some Facebook pages, but that has not been that successful as of yet.

I’m always asking those who stay with me if they know anyone coming to the area.

Ashley Bitner · Answer

@Kenneth Garrett - how are you finding military tenants? I've been thinking about this a lot lately as my property is near a base as well.

Kenneth Garrett · Answer

@R. Elle BerryI have adjusted to MTR with new acquisitions.  These properties are near military bases where I can pick up TDY training for months at a time.  Last few have been 6 month stays and the per diem rate exceeds the LTR significantly even with vacancy.

Property is generally left in great condition.  A lot less work than STR and the income difference is not that significant and way less wear and tear.

Hoshang Hafizi · Answer

Most of the replies here are about whether MTR is growing. The part I'd dig into is  how would you know it's outperforming. I measure that differently than just looking at rent.

It is not solely about gross rent. On my furnished unit MTR does beat the long-term number but a good margin. But the gap looks bigger on paper than it is. You have to net out the costs a long-term lease never carries. Furnishing, spread over a couple years. Utilities and internet, on me. A turnover every three to nine months instead of once a year. Re-marketing time. And the vacancy gaps between stays. Once those land, the premium shrinks to a thinner net edge. Still real, just smaller than the headline.

My reason for MTR over LTR was that I already had it furnished. So now I have the optionality. I can move the same unit between MTR and long-term as demand shifts, the place also comes back in much better shape than an STR, with a fraction of the wear, but gives me enough time to fix/clean things between tenants.

On the shift, I think it's real, but not mainly the economy. It's STR saturation and tighter short-term rules pushing operators down a tier into MTR. And the demand doesn't ride tourism. Healthcare, relocation, insurance displacement, corporate. That base is stickier than a nightly calendar.

R. Elle Berry · Answer

Wonderful! Glad we can connect and share valuable information! I will look into those sources too. Thank you Kenneth.

Ashley Bitner · Answer

@Kenneth Garrett - thanks for the tips! I'm going to look into Fox3 Lodging and TDY Hero!

Allen Duan · Answer

We manage MTRs in SoCal for all of our properties across the region and for different property sizes. MTR rents are 1.5 to 2X LTR, with average occupancy around 80%. For the right property here, MTR definitely gets you more cash flow than LTR. I've heard other markets can get up to 2x to 3x LTR rents.

Are mid-term rentals outperforming traditional rentals in your market? If so, how?

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