A Landlord’s Guide to Mid-Term Rentals
Mid-term rentals tend to fall into an ambiguous space between short and long time stays, but they are a category all their own with unique upsides and challenges for landlords.
We’ll cover all these aspects right here alongside everything else you need to know about the mid-term rental market including the kind of tenants you can attract and where you should be listing your property.
What is a Mid-Term Rental?
A mid-term rental is anything that falls between a 1-12 month lease, but we’ve found that a 3-6 month period tends to be the standard use. They’re also sometimes referred to as month-to-month rentals as that’s how the lease operates.
Rentals like these have been common in European cities for some time but are slowly becoming more popular in the US. A 2022 survey on housing leases in the US rental market showed that month-to-month leases took a 30% share. As we’ll look into further, mid-term rentals fulfill the needs of quite a specific set of renters which landlords can use to access new markets and often, higher rentals.
Who Stays in Mid-Term Rentals?
For the most part, people who stay in mid-term rentals are seeking somewhere to live that doesn’t require too much of a time commitment. Here are some of the people landlords can target as mid-term renters:
Most college students look for leases that fall more in line with the length of the school year rather than the calendar year. This allows them to have flexibility over the summer for internships and traveling. Incidentally, students following summer internships are yet another great market for mid-term rentals as they’re often needing somewhere that can provide them with a 3-month stay.
People relocating to new places are often hesitant to sign on for long-term leases while they’re still getting to know the area. This is especially true for ex-pats or anyone moving into big cities where the neighborhood options seem endless. By providing people a place to stay as they familiarize themselves with a place, a mid-term rental can fill a much-needed gap.
People with Temporary Work Commitments
Many people are having to live an almost nomadic lifestyle for their work, moving from one contract or posting to another. Nurses, seasonal agricultural workers, and contractors are just some of the people we see this with. The most lucrative side of this market, however, tends to be corporate housing for people like consultants as the businesses that hire them will often cover rent and are willing to pay more than most individuals would.
Homeowners in Transition
Anyone who has sold a home knows that the transaction often goes through before a new property is ready to move into. Homeowners will often seek out a mid-term rental as a stopgap while they find their new home, decide on a new neighborhood, or renovate.
The Differences Between Mid-Term, Short-Term, and Long-Term Rentals
The differences between these rental categories come down to the period of the lease and the type of person they’re likely to attract as a result:
Lease Length: 1 – 30 days.
Renters: Usually travelers and vacationers.
Lease Length: 1 – 12 months.
Renters: Anyone needing to stay in an area for longer than a month but doesn’t want to commit to a full year. Usually people in transition between homes, study situations, etc.
Lease Length: 12 months and above.
Renters: People who are quite settled in an area and have clear plans to stay. Tend to be above college age.
The Pros and Cons of a Mid-Term Rental
If you’re a landlord weighing up whether mid-term rentals are worth offering, here are some of the perks and challenges involved in this kind of leasing:
Pros of Mid-Term Rental
- It provides a steadier cash flow than short-term housing as you’ll have tenants for longer periods and can avoid the seasonal fluctuations that vacation rentals usually have.
- Skip the hassle of long-term tenants. Mid-term tenants have a higher turnover rate which allows you to avoid getting stuck for too long with a problematic renter.
- You can fill a gap in the market and add another angle to your business in the process. Offering a mid-term rental can make properties more attractive simply because they fulfill a need that others aren’t while also allowing you to expand your business.
- Sometimes you can charge more. Especially if you choose a month-to-month lease structure, landlords can often charge a higher rent than they would have been able to for longer-term rentals.
- Give yourself some flexibility. Less commitment isn’t just great for tenants, it can be an opportunity for you as a landlord to cultivate more flexibility.
Cons of Mid-Term Rental
- A higher tenant turnover does mean you’ll be looking for new renters more often which can be time-consuming.
- Generally, it’s expected that mid-term rentals be furnished. This can be quite an expensive initial investment if your place is currently unfurnished but should pay off in the long run.
- The risk of having students or other mid-term renters is that they can sometimes be riskier tenants in terms of noise and property damage. What’s key in this is sticking to a strong tenant screening approach.
- Mid-term rentals tend to have more legal issues than short-term ones. Make sure to check in with your attorney and local housing laws to make sure you’re covered.
What to Include in a Medium-Term Rental Lease
Here are a few of the key aspects that you’ll need to include as you put together a lease for a medium-term rental:
- The length of occupancy and whether it’s a set period or a month-to-month commitment
- The amount of rent you’ll be charging and when it must be paid by
- The security deposit and any other fees that need to be settled upfront
- The amenities, such as Wi-Fi, that tenants will have access to and their appropriate uses
- If the place is furnished, specifications need to be made about what happens if anything is damaged by the tenant
- The rights and responsibilities of both tenant and landlord in accordance with local regulations
The Best Places to List Your Mid-Term Rental
We’d always recommend listing your property on more than one site to improve your reach. Here is a mix of sites that specialize in mid-term rental options as well as more general listings:
- Landing: With a focus on listing month-to-month furnished properties, this site seems to attract the perfect mid-term rental with an average lease length of 3-6 months.
- Kopa: This well-regarded platform specializes in mid-term rentals so is especially easy to use for these listings.
- Furnished Finder: Aimed at traveling medical workers and other business people, this site only lists furnished, mid-term rentals.
- Facebook Marketplace: Many people rely on FB Marketplace to search for rentals so it’s always a great place to list your property.
- MLS: It may be a very general listing site, but MLS gets great attention from other portals such as Redfin and Zillow so don’t ignore it.
Mid-Term Rentals for Big-Time Opportunities
Mid-term rentals offer up a new share of the market that can be highly lucrative for landlords while also offering some added flexibility. If you’re worried about the long-term costs of managing tenant damage in a furnished property or possibly attracting a riskier tenant type such as students, have a look at our rental property insurance policy options and what they can help cover. Our services are designed to suit landlords and the specific worries that come with renting out a property, mid-term or otherwise.
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