Mid-Term Rentals in Multifamily

Today’s Thesis Driven is a guest letter by Luke Bujarski. Luke is the founder and principal at LUFT, a strategic marketing firm specializing in real estate and hospitality. He is also part of the founding team and head of strategic growth at Extenteam, a workforce solutions company for the short-term rentals industry. 

The need for housing does not split neatly into long-term (12+ month) and short-term (night-to-night) buckets. While they’ve received far less attention than short-term rentals (STRs), mid-term rentals serving stays of one to eleven months are gaining steam with multifamily owners who see them as offering the best parts of STRs—increased income—without the annoyances and regulatory burden.

Today’s letter analyzes the current mid-term rental (MTR) opportunity with an eye toward how multifamily owners can effectively incorporate MTRs into their portfolios. Specifically, we’ll tackle:

• Demand and supply trends shaping the MTR market; 
• Opportunities and risks of MTRs, including regulatory risks;
• Major MTR operators including VC-backed MTR players;
• Challenges and benefits of operating MTRs in-house;
• Underwriting MTR income and operating costs.