Mid-term rentals are becoming a popular trend in today’s rental market. They cater to people who need a place for not too short or long a time, just a few weeks or months. Given the growing demand, these rentals are on many investors’ radars. Read on to learn why mid-term rentals may just be the future of real estate.
Contents of the Article
- What Are Mid-Term Rentals?
- Benefits of Offering Mid-Term Rentals
- Potential Drawbacks to Consider
- FAQs
What Are Mid-Term Rentals?
Mid-term rentals are rental properties that you can lease for a medium-length period. Their leases tend to last longer than a short vacation but shorter than a full year-long lease. To be specific, these tenancies can range from a few weeks to a few months, depending on the tenant’s needs.
Mid-term rentals appeal to people who need temporary places to live. For example, if someone is moving to a new city, studying abroad, or needs a temporary living arrangement, they might look for a place to stay in between. Because these rentals offer so much flexibility, they’ve been on the rise.
If you’re considering offering a mid-term rental, working with a property management company in Washington, D.C., can help manage the process smoothly.
Benefits of Offering Mid-Term Rentals
The rise of remote workers has upped the professional demand for medium-term living spaces. According to the U.S. Career Institute, an estimated 14% of working adults will be doing so from home. Moreover, they reported that in 2023, remote workers were 9% more likely to plan on moving to a new home than in-person workers were. Needless to say, these signs point to an increased demand for rentals that meet the remote work lifestyle. This is a prime opportunity for investors to pounce on. Big brands like TurboTenant, Azibo, and BiggerPockets have reported on benefits such as:
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Flexibility and Stability
With mid-term rentals, you can get the best of both worlds. You have the flexibility to adjust the rent after a tenant vacates. At the same time, you can also benefit from the stability of monthly rental payments.
The former point is exceptionally useful if your property is located in an up-and-coming area. For example, during peak seasons or as demand increases, you could raise the rent to reflect the property’s market value.
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Less Maintenance Expenses
Since tenants typically stay for a few weeks to a few months, the property can have a lighter load. It can experience less wear and tear over the course of the year. So, you could face fewer repairs and maintenance tasks compared to traditional long-term leases.
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Tends to Attract Responsible Tenants
In our experience, this type of housing tends to attract responsible tenants who are there for a specific purpose. These renters are typically more respectful of the property since they’re not just there for a weekend getaway.
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More Stable Income
Mid-term rentals may offer you a more consistent and predictable income stream compared to short-term rentals, like Airbnb. After all, short-term rentals can be unpredictable. You might have lots of bookings one month, and very few the next, which can make your income fluctuate greatly. However, with mid-term rentals, tenants usually stay for weeks or months. So, you can count on a steady rental payment for that period. This key factor makes budgeting and planning easier for property owners.
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Less Competition in the Market
Popular vacation spots are full of Airbnb listings, but fewer options exist for people who need a place for a few months. As a property owner, you might find it easier to stand out in a less crowded market. You can hit that sweet spot, attracting tenants looking for that in-between option. And you can do all this without the stress of competing with dozens of other short-term listings.
Potential Drawbacks to Consider
Mid-term rentals are becoming increasingly popular for a reason. They offer one of the most convenient housing options in today’s world. However, like anything, they come with both benefits and drawbacks. Here are a few things to consider before investing in mid-term rentals:
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Vacancy Gaps
Since tenants don’t stay as long as in a year-long lease, there could be periods where your property is empty between renters. So, while you can enjoy a steady income during your tenancies, you will have to face unfilled slots after them.
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More Marketing and Onboarding Work Needed
Since tenants usually stay for a few weeks or months, you’ll have to find new renters more often than long-term leases. This means you’ll need to spend more time marketing your property, screening tenants, and handling paperwork. As you can imagine, this is something to keep in mind.
FAQs
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How can I find tenants for my mid-term rental?
There are sites you can try, like Vrbo, for finding tenants. If you’re serious about securing qualified tenants, you may want to invest in a professional property manager. They are specially trained in marketing best practices. Furthermore, they have years of experience navigating the nuances and demands of your rental market.
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Can I adjust the rent for mid-term rentals?
Yes! With mid-term rentals, you have the flexibility to adjust rent based on factors like seasonality or increasing demand in your area. For instance, if your property is located in a high-demand area, you can raise the rent during peak seasons or when the market value increases.
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Are mid-term rentals less work than long-term rentals?
Mid-term rentals may involve more turnover than long-term leases. In turn, this would mean you have to prepare the rental for new tenants more often. At the same time, you can choose the timeframes with which to schedule tenants. This way, you can clean the property at your own pace.
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What are the potential risks of investing in mid-term rentals, and how can I minimize them?
Like many types of rentals, this tenancy comes with the risk of vacancies and increased tenant prep time and costs. However, if you actively work to manage tenant occupancy, adjust rental prices based on demand, and keep the property in good shape, you can help minimize these pitfalls.
Is Investing in Mid-Term Rentals Right for You? Start Your Journey Today!
Now that you’ve learned about the benefits of mid-term rentals, you must evaluate your investment objectives and local rental patterns. Then, you can determine if mid-term rentals are the right choice for you.
Moreover, you may need a trustworthy partner to navigate this new adventure. Working with a property management company can help you manage your property, handle leasing and marketing to fill vacancies, and ensure you comply with all local regulations.
Luckily, at Bay Property Management Company, we do just that. We specialize in property management, leasing, and marketing. Whether you’re looking to run a mid-term rental or need help filling vacant units, our team can guide you every step of the way. Contact us today to learn more and get started!
