This article is presented by Connect Invest.
Mid-term rentals—fully furnished rentals with contracts of anywhere between 30 days and nine months—were once seen as a very niche or experimental option for real estate investors. A new report is suggesting that they are becoming more and more mainstream, and a great way to mitigate some of the risks from rising vacancies in the traditional rental sector.
The report, put together by Landing, reveals several intriguing facts about how investors currently perceive mid-term rentals. Most see them as having serious portfolio-expanding potential, with 93% of respondents saying they’re actively seeking new revenue models, and 88% saying they would use mid-term rentals as a way to reduce the impact of vacancies.
At the same time, many investors perceive major barriers to entry into this segment of the rental market. Nearly half (44%) aren’t completely certain about sufficient demand levels for mid-term rentals, while around a third (38% and 33%, respectively) anticipate problems with logistics or sourcing furnishings.
Mid-Term Rentals: High Initial Costs, Higher Rewards
Without a doubt, the often substantial investment into high-quality furnishings and appliances is daunting for an investor used to traditional rentals, which are typically leased out unfurnished. Essentially, a mid-term landlord will have to combine the know-how of an Airbnb host with the savvy of an investor.
Mid-term homes typically attract renters who are professionals. These types of rentals are very popular with remote workers and people required to travel frequently (think visiting academics, doctors, and nurses).
This category of guest expects a higher standard of accommodation, which may include…