In the dynamic world of hospitality, short-term rentals have long been a go-to choice for both property owners and travelers seeking flexible and personalized accommodations. However, the landscape is evolving, and savvy operators are exploring a new avenue: mid-term rentals. These extended stays, typically spanning a month to several months, are gaining traction for a multitude of reasons, offering a fresh perspective on hospitality ventures.
What are Mid-Term Rentals?
Mid-Term Rentals are typically defined by stays of 30 days or more at time. They are a popular option for travelers who need to stay in a particular location for at least a month, but don't want to commit to a long-term lease.
What are the Trends Causing a Shift from Short-Term to Mid-Term Rentals?
There are a few key trends that are causing vacation rental operators and property managers to switch from short-term rentals to mid-term rentals.
The Rise of Digital Nomads and Remote Work: The COVID-19 pandemic has led to a significant increase in the number of people working remotely. This has created a new demand for mid-term rentals, as people look for temporary housing solutions that allow them to stay in a particular location for a few months at a time. Mid-term rentals can offer these travelers working remotely, traveling for business or other essential purposes a more suitable option than short-term rentals.
Local Regulation and Bans of Short-term Rentals: Increasingly stringent regulations and outright bans on short-term rentals of less than 30 days in various locations have left operators seeking alternative rental options that comply with local laws while maintaining their revenue streams. In recent years, there has been a growing push to regulate the short-term rental industry. This is due to concerns about the impact of short-term rentals on local communities, such as increased noise and traffic, and the displacement of long-term renters. As a result, some cities and towns have imposed restrictions on short-term rentals, making it more difficult for operators to rent out their properties for less than 30 days.
The Benefits of Mid-Term Rentals
While short-term rentals can still be profitable, mid-term rentals offer a number of advantages, such as reduced regulatory risk, more predictable income, and a wider range of potential guests.
Here are some additional benefits of switching to mid-term rentals:
Reduced Hassle: Longer stays translate to fewer turnovers, reducing the time and effort spent on cleaning and preparing the property between guests.
Stable Income: With mid-term guests staying for weeks or months, operators enjoy a steadier income flow compared to the seasonal ebbs and flows of short-term rentals.
Enhanced Property Care: Longer stays often lead to guests treating the property more like their home, resulting in better maintenance and fewer damages.
Lower Marketing Costs: Instead of constantly seeking new guests, operators can focus on building relationships with a smaller pool of mid-term guests, thereby saving on marketing expenses.
New Guest Profiles: Mid-term rentals attract a diverse range of guests, expanding an operator's guest profile and increasing opportunities for building lasting relationships.
Strategies for Attracting Mid-Term Guests
There are a number of proven strategies when it comes to mid-term rentals. Below is a list of the most common:
1. Travel Medical Professionals:
Investigate your local market when it comes to hospitals. Find out which hospitals are near your properties and if they are a level 1, 2, or 3 hospital. If so, there will likely be a significant amount of traveling medical professionals needing accommodations in your market.
Collaborate with healthcare staffing agencies to offer housing options for travel nurses and medical professionals who require temporary accommodations during their assignments. Create a small poster and ask the hospital if they’d be willing to share your contact information with any of their traveling medical staff or if they’d be willing to post it up in their staff rooms.
There are also government and nonprofit agencies that focus on helping medical professionals get certification from another country and help with rotation placements and housing. They often need accommodation partners in specific regions where they always have placements and getting in contact with one of these agencies and offering your accommodations is a great way to have recurring and high quality professional guests.
There are a few marketplaces dedicated to traveling medical professionals:
2. Insurance Agencies:
Insurance companies include what’s called Additional Living Expenses coverage in their policies in case of claims. This means they’ll cover any expenses should someone not be able to live in their home because of a covered claim. These insurance companies can pay up to four times what you would get from a normal guest because they need to place people quickly and already have allocated large budgets for this. They may either handle these placements internally or have an agency they work with that specializes in finding accommodations for displaced homeowners or renters.
Reach out to insurance companies or agencies in your market and build a relationship so that you can provide accommodation for individuals who require temporary housing due to emergencies, disasters, or home repairs.
3. Business Professionals:
Market your mid-term rentals to business travelers, remote workers, and corporate employees who need a comfortable, convenient, and private space to stay while working in the area. Research conferences happening in your area and build relationships with the organizers responsible for providing accommodation for speakers and attendees.
You can also reach out to any companies who have large corporate head offices in your area and let them know your properties are available and set up an agreement with them as they may have employees or executives visiting frequently.
4. Sporting Events & Teams:
If your market provides a stage for professional sports or races, track meets, games, etc. then you may just have an incredible opportunity to be building relationships in the world of sports. Cater to athletes, coaching staff, and sports enthusiasts seeking comfortable and convenient accommodations during training camps, tournaments, and events.
Another often overlooked area is to search for past school meets or games for K-12 grades in your area then reach out to those regional school sports teams or associations that traveled in the past and offer your accommodation if they’re planning to come again. Often they will need to be in an area for longer if there’s a big playoff or tournament that may last weeks. If you have accommodations that fit a larger group, it’s very attractive for these groups as they want to stay together and it’s much more cost effective than renting many hotel rooms.
5. Educational Institutions:
Connect with local colleges, universities, and educational institutions to offer accommodations for students, professors, or visiting scholars.
6. Relocation Services:
Work with relocation companies to offer temporary housing solutions for individuals and families who are in the process of moving.
7. Seasonal Workers:
Collaborate with local businesses and industries that require seasonal workers and provide them with suitable accommodations during their contracts.
8. Expatriates and International Assignees:
Target individuals who are relocating for work or personal reasons and need a temporary home as they settle into their new surroundings.
Summary: Get Ahead of the Curve and Begin Adding Mid-Term Rentals to Your Vacation Rental Business Model
As the hospitality landscape continues to evolve, short-term rental operators are recognizing the potential of mid-term rentals as a lucrative and stable alternative. Whether driven by local regulations, the appeal of a diverse guest demographic, or the desire for a more manageable operational model, mid-term rentals offer a host of benefits. By adopting targeted strategies, such as catering to travel medical professionals, partnering with insurance agencies, and accommodating business travelers, operators can seamlessly transition into the mid-term rental market, tapping into new revenue streams, nurturing long-lasting guest relationships and diversifying in case of regulatory changes. The path to success in the hospitality industry is transforming, and mid-term rentals are becoming another viable option for many operators in the industry.