Mid-term rentals have quickly become a popular way to serve a new and growing segment in the market – travel nurses!
During Covid 19, nurses in increasing numbers began to travel to the areas where they were needed most. Since they were staying for 30 to 90 days, they preferred having a more comfortable place to stay than a hotel – and they were able to pay a lot for it.
A small, 1 bed 1 bath, 800-1000 square feet, furnished house in a safe, quiet neighborhood near the hospital proved to be their ideal alternative. Indeed, nurses and other single traveling professionals are paying much higher prices to stay at this type of furnished rental than long-term tenants would.
Although covid is mostly behind us, the travel nurse trend has caught on and stayed. Hospitals are realizing the value and flexibility travel nurses offer. Nurses in increasing numbers are leaving routine hospital jobs and taking on special traveling assignments.
And…real estate investors are providing their housing. It’s a win–win–win!
Mid-term rentals are perfect not only for travel nurses, but also for other travel professionals and for insurance relocations, too. Insurance relocations often require a larger 3 bed 2 bath house to fit the needs of a family.
When furnishing a mid-term rental house, remember the three C’s: comfy, cozy, and cute! You’ll want it to look great in the marketing pictures. The house should be fully furnished, including simple, attractive decor.
The owner pays for cable, wifi and all utilities. Equip the kitchen with all the basics and maybe some nice extras. Provide towels, sheets, and a few consumables: a starter kit of coffee pods, hand soap, laundry detergent, etc. Once the tenant is in, they will shop and stock the place for themselves.
Their need to shop brings up the key to choosing a property to rehab as a mid-term rental– location! Of course you’ll want it quiet, safe, and near a hospital, but you’ll also want it near the places your tenant wants and needs to go.
The presence of a nearby Chick Fil-A, Chipotle, Target, Costco, a good grocery store, and a popular convenience store are great indicators that you’re investing in the right area. Property values there will continue to appreciate.
Why are real estate investors getting into mid-term rentals?
- Mid-terms bring high rents. You also get to interact with the tenants more in the beginning so you know who is in your house. Short-term rentals also bring high rents, but generate a constant flow of traffic in and out of the house.
- You book the tenants. Because short-term rentals are done through a booking website, you don’t know who is staying there, and guests are likely to be harder on the property than a long-term tenant.
- Since the lease is fairly short on a mid-term rental, you get to have eyes on the property more frequently, to make sure it’s being kept in good shape. Long-term rentals don’t bring in rents as high as mid- or short-term, and you rarely see your tenant or the property.
When looking for a prospective property, think of mid-term rentals as a spin-off of the BRRRR strategy, and stick to what you know. The key, as always, is the deal. Make your numbers work. Don’t offer too much for a cute house just to own a mid-term rental. Always buy at a discount.
Have multiple exit strategies for any property you buy: mid-term rental, long-term rental, Airbnb, or sale. This gives you flexibility to take advantage of any market shift.
Insurance and financing for a mid-term rental is the same as for a long-term. Nothing tricky there. Occupancy inspection is good for a year or when utilities change.
Have you heard of Furnished Finder? It is a marketing platform for mid-term rentals, not a booking platform like Airbnb. With a marketing platform, an owner has more control over who is going into the property.
Furnished Finder is a useful resource for investors, landlords and travel professionals alike.
The cost for landlords is $100 a year for lead generations and tenant applications. Criminal background and soft credit checks are done through the app.
When considering an applicant, request their general contract with the hospital – who their supervisor is, the duration of their stay, etc., so you know exactly who you’re dealing with. FaceTime with the potential tenant to help them feel secure about renting with you.
A community of local investors can help each other out with referrals. Hedge funds are getting into the mid-term rentals game, but they can’t tailor the experience like a local investor can.
Trends suggest that the growing numbers of travel nurses and other travel professionals will make mid-term rentals an ongoing active niche. It’s one of many possible strategies that can work with the BRRRR approach.