Medium term rentals
When it comes to rentals in real estate it is broadly divided into short and long term rentals. However there are some other agreements that doesn’t have to fall into these two categories.
But before we proceed into explaining the concepts of medium term rentals, let me first refresh your mind with what you already know; short term and long term rentals.
Short Term Rentals: A short–term rental is typically defined as a rental of any residential property for a short period of time. This generally includes stays in days or weeks, but usually it is never more than a month (30 days).
Long Term Rentals: A long term rental on the other hand, refers to the rental of any property for a period not less than 12 months.
So as you would expect, medium term rentals falls in-between these two options.
So in today’s blog post we shall explore the benefits and considerations for going for Medium-Term Rentals in Real Estate
Medium Term Rentals in Real Estate – Introduction
The real estate landscape is constantly evolving, and property owners and renters alike are exploring new avenues for flexibility and convenience. One such option gaining popularity is medium-term rentals. Situated between traditional long-term leases and short-term vacation rentals, medium-term rentals offer a unique set of benefits and considerations for both property owners and tenants. Whereas Airbnb made short term rentals very popular and acceptable globally, medium term rental is set to be the new order come 2024 especially with the increase in the supply of service apartments. In this article, we will delve into the world of medium-term rentals in real estate, highlighting the key aspects to consider.
What is a Medium-Term Rental?
Medium-term rentals typically refer to lease agreements that fall between the short-term, typically daily or weekly, and long-term, typically annual, rental options. They usually span anywhere from one month to several months, providing a flexible housing solution for various scenarios. If the rental is less than one month it is assumed to be short term rental. And if it is more than 12 months it is assumed to be long term.
Benefits of Medium Term Rentals to Property Owners
Steady Income: Medium-term rentals provide property owners with a consistent stream of income, often at higher rates than traditional long-term leases. This can help cover mortgage payments and property expenses more effectively, rather than waiting till the end of a year or more as is the case with long term.
Less Turnover: Compared to short-term rentals, medium-term tenants tend to stay longer, resulting in less turnover and reduced vacancy periods. This minimizes the hassle of frequent tenant changes and maintenance.
Flexibility: Property owners have the flexibility to adjust rental terms and pricing to respond to market conditions and their personal needs. This is a huge advantage over long term.
Lower Maintenance Costs: Since tenants stay for more extended periods, they are likely to take better care of the property, leading to reduced maintenance and repair costs as is usually the case with short term.
Benefits of Medium Term Rentals to Tenants
The good thing about medium term rentals is that it favours both the property owner as well as tenants. Below are some of the benefits for tenants:
Home-Like Experience: Medium-term rentals offer tenants a more home-like atmosphere compared to hotels or short-term rentals. It is the ideal place for business travelers, remote workers, or people relocating temporarily.
Cost-Effective: While typically more expensive than long-term rentals, medium-term rentals are often more cost-effective than staying in hotels, especially for extended periods. With medium term rentals you can get a six month accommodation for the price of staying in a hotel for 30 days.
Flexibility: Tenants enjoy greater flexibility without the commitment of a long-term lease. This is especially valuable for those uncertain about their future plans or looking for temporary housing during a transitional period.
Fully Furnished Options: Many medium-term rental properties come fully furnished, saving tenants the expense and hassle of purchasing and moving furniture. Of course this is optional, so it makes it easy for the tenant to choose what suits them.
Considerations for Both Parties
Legalities: Property owners and tenants must understand and comply with local laws and regulations governing medium-term rentals, such as taxation, zoning, and tenant rights.
Screening: Thorough tenant screening is crucial to ensure that the property is occupied by responsible and reliable individuals who will maintain it properly.
Rental Agreements: It’s essential to have a well-defined rental agreement that outlines rental terms, responsibilities, and expectations for both parties.
Property Management: Property owners may opt to manage the property themselves or employ a property management company to handle tenant issues, maintenance, and administrative tasks.
Medium Term Rentals in Real Estate – Conclusion
Medium-term rentals in real estate offer a win-win situation for both property owners and tenants. Property owners benefit from steady income, reduced turnover, and flexibility, while tenants enjoy a more home-like experience, cost-effectiveness, and flexibility in housing choices. However, it’s crucial for both parties to navigate the legalities, screening, and agreements carefully. As the real estate market continues to evolve, medium-term rentals are likely to become an even more prominent and attractive option for all involved.
Frequently Asked Questions on Medium Term Rentals in Real Estate
Here are some of the frequently asked questions about medium-term rentals:
1. What is a medium-term rental?
A medium-term rental is a lease agreement that falls between short-term and long-term rentals. It typically spans from one month to several months, offering a flexible housing solution.
2. How are medium-term rentals different from long-term leases?
Medium-term rentals are shorter in duration, often ranging from one to six months, whereas long-term leases typically last for a year or more.
3. Are medium-term rentals furnished?
Many medium-term rentals come fully furnished, making them convenient for tenants. However, it can vary, so it’s essential to clarify whether furnishings are included in the rental.
4. Who typically uses medium-term rentals?
Medium-term rentals are popular among business travelers, remote workers, tourists staying for an extended period, individuals relocating temporarily, and those in transitional phases, such as renovations or home buying.
5. How do rental rates for medium-term rentals compare to long-term leases?
Medium-term rentals often have higher monthly rates than long-term leases but are generally more cost-effective than short-term vacation rentals or hotels, especially for stays of a few months.
6. Can I negotiate the terms of a medium-term rental?
Yes, medium-term rentals are typically more flexible, and both property owners and tenants can negotiate terms, including rental rates and lease duration.
7. What are the legal considerations for medium-term rentals?
Legal considerations include complying with local regulations, understanding taxation implications, and adhering to tenant rights and responsibilities outlined in the lease agreement.
8. Do medium-term rentals require security deposits?
Security deposits are common in medium-term rentals to cover potential damages or unpaid rent. The amount can vary and should be specified in the lease agreement.
9. How can I find medium-term rental properties?
You can search for medium-term rentals on real estate websites, rental listing platforms, through property management companies, or by working with real estate agents who specialize in this type of rental.
10. What is the notice period for ending a medium-term rental?
The notice period for ending a medium-term rental can vary and should be clearly defined in the lease agreement. Typically, it ranges from 30 to 60 days.
11. Can I renew a medium-term rental if I want to stay longer?
Renewing a medium-term rental is possible if both the tenant and the property owner agree. It’s advisable to discuss renewal options well in advance of the lease expiration date.