As real estate investors explore various avenues to maximize their returns, one emerging trend is monthly midterm rentals (MTRs). These properties, furnished and rented for durations longer than short-term stays but normally less than a year, provide an interesting middle ground. Despite their growing popularity, several myths continue to linger around MTRs. In this blog post, we will dive deep into these misconceptions and provide clarity based on insights from experts and seasoned investors. Furnished Finder (opens in new tab) is the leading platform for monthly rentals with over 300,000 properties available nationwide making it easier for landlords to connect with potential tenants.
Myth 1: You need to own property to start with MTRs
One of the most persistent myths surrounding MTRs is that you must own property to be involved. The reality is quite the opposite. Many successful investors use the rental arbitrage model, where they lease properties from other owners with the intent to sublease them as MTRs. This strategy allows investors to enter the rental market with minimal capital. For a deep dive on rental arbitrage, catch episode 142 (opens in new tab) of Furnished Finder’s podcast, Landlord Diaries.
Myth 2: MTRs only cater to travel nurses
While travel nurses were among the first to popularize MTRs for their temporary work assignments, the tenant base has significantly diversified. Today, MTRs cater to various professionals, including construction crews, insurance relocation clients, and corporate executives. This expanded market base ensures a steady demand for MTRs, regardless of the season.
Myth 3: Monthly rentals suffer from seasonal fluctuations
Contrary to common belief, MTRs are not subject to drastic seasonal vacancies. Unlike short-term vacation rentals that fluctuate with tourist seasons, MTRs tend to provide stable bookings throughout the year. This is because tenants, such as corporate professionals or families seeking transitional housing, typically secure these rentals for work or relocation related purposes that extend beyond mere vacations.
Myth 4: High furnishing costs make MTRs unviable
The idea that furnishing MTRs is financially daunting is another misconception. Many modern furniture companies offer affordable yet durable furnishing solutions tailored for rental spaces. It's recommended to source quality yet affordable furnishings to stage your property attractively while ensuring longevity.
Myth 5: Utilities are a financial burden
Another frequent concern among investors is the utility costs associated with MTRs. With proper planning, landlords can easily manage these expenses. Many investors include utility costs in the rent while clearly defining usage limits within lease agreements to avoid unexpectedly high bills. Furnished Finder’s podcast episode on this topic (opens in new tab) provides guidelines on how to administer these aspects effectively.
Myth 6: Pet-friendly rentals will be damaged
Pet-friendliness is a sought-after feature for many renters. Around 30% of Furnished Finder booking requests require a pet friendly space. While there is a fear of potential property damage, providing accommodations for pets can significantly widen your tenant pool. Protective measures, from pet deposits to cleaning fees, can mitigate the risk, making it a winning strategy for both landlords and tenants.
Embarking on your MTR journey
As the landscape for real estate investments evolves, monthly furnished rentals present a promising opportunity. Proactive engagement in learning the trade and adapting to market demands can position investors for considerable returns. To deepen your understanding, listen to our Landlord Diaries podcast episode (opens in new tab) featuring key industry players and experts discussing these myths and more.
Conclusion
Deconstructing these myths helps real estate investors realize the potential of monthly rentals. By leveraging platforms like Furnished Finder (opens in new tab), investors can tap into this lucrative market and enjoy sustainable success. Whether you're a seasoned investor or exploring investment opportunities, embracing the nuanced realities of MTRs could be your next strategic move in real estate.
For more tips and insights on becoming a successful landlord, visit Furnished Finder’s Landlord Resources (opens in new tab) today!
Episode 152 Transcript
That is absolutely not true. In some ways, I actually wish people would call more often part of the best job. Part of the, one of the best parts of this job is getting to know the residents and hearing what their stories are and what brought them to our little town. So I actually encourage them to reach out when they need to.
But for most of the residents, this is their home. This is where they're living for the next one month, three months, six months, 18 months is our record. Think of all the things that you would call someone for if it happened at your house. Not a whole lot of them, yes. If there was to be an issue with water, I want to know about it immediately.
But if you can't find the dish rag, you open more drawers until you find it. You're not bothering your landlord about that. This is their home and they treat it like that by and large. And that's actually one of the things that makes MT R so great is that you're dealing with people who are. Want to be there.
By and large you're helping them out. They recognize that you're on their team.
Welcome to The Landlord Diaries, the official podcast of Burnished Finder, your trusted companion for building success and monthly rentals. I'm Kelly Bailey with eight Cash Flowing Monthly Rentals in Texas. And I'm Katie Lyon, marketing director at Furnished Finder and real estate investor with 13 furnished rentals across multiple states.
In every episode, we share real stories, practical tips, and expert insights to help you grow with confidence from securing better bookings to maximizing your rental income. So follow up the show and let Furnished Finder be your partner in building a thriving monthly rental business.
What if everything you think you know about monthly midterm rentals is wrong? Today's guest, Miguel del Mazo, skipped right over short-term and long-term rentals and went all in on furnished midterm stays, and it's paying off. With six active rentals on Furnished Finder and a portfolio that runs like clockwork.
Miguel is living proof that midterm rentals can be both profitable and low stress from hitting 93% occupancy to attracting top tier tenants who aren't just travel nurses. Miguel is here to bust the biggest myths. Investors still believe about furnished monthly stays. Miguel, you've got big shoes to fill today.
How are you? I'm doing great. I really do appreciate you guys reaching out and having me on the show. This is a great honor. Thank you. Yes. Stay tuned to the end. I've already spoken with Miguel. He's got great answers, so let's bust those myths. First off, give us more of your story. What convinced you to go all in on midterm rentals and skip short term and long-term rentals entirely?
So my story's a little bit unusual. I'm actually a physician. I'm a surgeon, born and raised in Georgia during COVID. The Corona epidemic. A lot of nurses were coming to our hospital and were coming through for stays, but they didn't have a great place to stay. They were coming in and I was seeing new faces in the operating room and getting to meet the folks who were staying and asking where they were staying.
And I felt that there was a need to provide great quality housing to the folks who are coming through and helping save the patients of my above old town up here in North Georgia. So my wife and I got together, we talked about it. She's also a physician and we bought a, bought our first condo, fixed it up, put some furniture in it nice furniture.
But as we learned over time, there's always things that can be done better. So we started iterating and, but after that first one did well, we kept acquiring new properties, either ones that we own ourselves or ones that were arbitraging with a friend and just kept putting people in safe spaces for them to do the work they need to do in Gainesville.
That's a fantastic way to support your community and support the people that you are seeing to come in and help your community at your job. That's, I think that's incredible. And also that you can have such an important and busy job and still be a landlord of these midterm rentals, I think speaks to the operational efficiencies of them.
So tell us about your current portfolio, what. Types of rentals do you have, how many? And then we will jump into these myths. So our first rental was a town home and then a condominium community. It's a two bedroom, one bathroom, one and a half bathroom. And that kind of got the ball started for us and we rented from another friend.
We arbitraged her unit in the same condominium complex. And by that point we were off to the races and sometimes I might. Be overly ambitious, but we found a single family home that was zoned multifamily and it had an upstairs and a downstairs, and I thought they could be even more than that.
Little crazy maybe, but worked with the city and were able to put together a triplex out of that house. 11 bedrooms, 10 bathrooms, three kitchens, five washer and dryer stations, eight parking spots. Probably wouldn't go back and make that my third property necessarily, but it worked out great. And sometimes you don't know what you don't know, and the best thing to do is just to, leave the harbor and start sailing.
So we definitely did that. Learned along the way, good contractors, bad contractors, what to do and what not to do when it comes to, showers and all sorts of things. But it was interesting. At that time, I actually stopped being a surgeon. I hurt my back. And I had my third back surgery at that time.
So during that building of that house, which took about a year, transitioned out of being a full-time surgeon into somebody who leaned more heavily into the MTR space as a way and only supporting the people who come to my town, but supporting my family. So that house came online. All three units came online.
I worked with another friend to rent their space back at that same original condominium complex. Then rented from them and eventually bought that unit. And now we're arbitraging a six unit from that gentleman as well. So we own five total units. We are arbitraging one or two depending on what we need in the moment.
Just try to make it work. Ooh. That's actually a fun myth to throw in that we don't have on the outline how you don't have to own property to jump into the mid terminal space. And Katie is also an arbitrage investor. So Katie, what do you wanna bust the myth about for our, for owning property versus arbitrage?
Yeah, I think it definitely helps with the myth that you have to have a lot of capital or funding to get started. Arbitrage is a very capital efficient way to get started and to just test out a market or a strategy or a home type or a location. I think that's, I think that's a fantastic one that a lot of people take advantage of.
I absolutely endorse the arbitrage model. So arbitrage being the idea that you take a relationship with someone else. Rent their property from them with a clear and concise lease with the permission to sublet that space. So you rent a long-term rental home or an Airbnb that someone's managing and they take, you take it over for them, and then you put the furniture in if needed, and then at a higher rate turn around and lease that back out to someone else.
So you're finding all of your MTR residents that are staying at that property. You're paying a consistent monthly lease to the owner of that property. You don't own the property, but it does get you in the game much sooner. You don't have to build up 20% down payments. You don't have to figure everything out.
It's a great way to get started in the MTR Landlording in general. It's a great way to try a new market out. It's like test phishing, rather than putting a hundred thousand dollars on a property's down payment only to find out that maybe that market wasn't the one you wanted. For the price of a monthly lease, the commitment of year long lease, you can find out if you like that market or not.
You can find out what kind of what kind of home you like. Do you wanna get smaller homes that would be better for a travel nurse or do you wanna get larger homes that would be better for a insurance relocation family? Something in the middle for a construction group. So arbitrage is a way to allow you to learn more about.
Not just the properties and the property types and the people who are gonna stay there, but also what your systems and operating procedures are gonna be. Do you not want to manage 20 of these? Maybe you don't. So arbitrage is a great way to, to get your feet wet without a huge commitment.
Love it. Let's go ahead and move on to the next myth, which is, hey furnish funder. Yeah, that's that site for travel nurses, right? And yes, we are the site for travel nurses. We also have so many more tenant types. So how have you seen the guest base evolve beyond just travel nurses? So absolutely in the beginning we were targeting nurses, specifically my wife and I, both being physicians.
That was somebody that we felt a call to serve, and we found that the unit size that we had definitely attracted nurses. And when someone says nurses, there's a lot of different jobs in medicine that would bring someone to a town. So not just nurses, but techs. There are CT scanner techs, ultrasound techs.
There are people who work in the respiratory therapy. Inside the, or on the anesthesia side, the traveling doctors themselves. So if you hear someone say nurses I think that is a large term that encompasses more than just RNs. But that was our original avatar that we were trying to serve. But as the, that larger property came online and I originally envisioned having 11 nurses all kind of cohabitating I learned that actually not everybody travels with 10 of their best friends to a new city.
It's surprised me. And we found that work crews come through. The town that we're based in is a tertiary markets. It's called Gainesville, Georgia. We have one in Georgia not just the Florida one. And Gainesville, Georgia is under a tremendous amount of construction. They're doing a tremendous amount and professional skilled work crews are coming through.
So that was a new avatar that we didn't know existed when we first got started. One of the insurance relocation companies reached out to us through furnish binder. They had a family that needed two separate spaces. They had a mother-in-law that lived in the house, and then they had the primary family and they wanted separate space.
And so our triplex was perfect for that. We've seen people coming through who are executives, they're coming through they're brought from Europe, and the companies wanted to pay for not just them to relocate, but their entire family to relocate. So you can bet that for them, school choice was really important.
So there's different ways of serving different individuals and different properties have different benefits for that. But I think really being flexible with who you want to attract while still trying to niche down what that property can best serve is very important in the MPR space. All right. Let's talk about our next myth that we are ready to bust, which is that midterm rentals are seasonal.
Miguel, tell us what you have seen from your end as far as seasonality, and do you see it or do you see consistency? So we definitely see consistency in our MTRs. I don't have nationwide exposure, but in our neck of the woods, which. On the short term rental side would definitely have seasonality.
It's beautiful here in the fall. I'm a Georgia native, but it's sweltering in the summer. And unless you're used to it, no, no one tends to, I can't wait to get to Georgia in August. It's not something hear people say, but the fall is gorgeous. The winter is gorgeous, but we don't serve someone coming through to have a party or family reunion for three days.
Folks, by and large are coming to work. Even the families that have been displaced by a fire or a flood, they're working in our community already and they need a place locally to stay, to live, to raise their children for those three to six to 12 months. They're there for professional reasons, and as long as there's not a seasonality to the professions that we attract, there's not a seasonality to the bookings either.
Yep. And I think that's something that is actually encouraging for those that are new to midterm rentals, is you have that 93% occupancy. Which means that you don't really have those seasonal gaps, but you also in the midterm rental space, sometimes get that last minute, is someone going to book my property?
And that's something that you have busted the myth of and overcome. So why don't you lean into that part of, when the occupants or when the bookings occur, and how to like, how to just set yourself up for success. So I think one of the greatest challenges of the Mt R space is the fact that it's not something you can necessarily predict five months in advance or three months in advance, or a month in advance.
It really can be a bit of a rollercoaster ride emotionally when you have a vacancy coming up. There's September 1st is going to be an opening. The likelihood of filling that spot before, I don't know, midgut is actually pretty low. People do sometimes reach out a month in advance, two months in advance, but in some ways you also don't want to book that far out because if I were to accept a great booking October 1st on August 1st, but I have an opening that begins September 1st, the chance of having that 30 days stay right there perfectly in the middle may be trickier.
And so it, it takes a different style of thinking about how vacancy works. Compared to the short term rental space or the long term rental space, the long term, you'll have 30 days notice. You'll have a pretty long turnover. That's probably gonna have to happen. May take a week or two. May take a week or two to get the filling of that next resident in your space.
Short term, because they pepper in. You just don't have to worry about it as much, but you're gonna have greater vacancy. Midterm requires a different way of thinking about it and being a little more patient. Which I'm not always great at, to be fair. And I certainly think sometimes when a vacancies coming up that, oh my gosh, the sky is falling, the sky is falling, and somehow God always provides a new resonant for us.
And the sky, in fact does not fall. But it is a, it is, it was a learning process, definitely for the first year or two. The vacancy is not not horrible. Obviously you want to get filled, but a day or two here and there is fine. I think it's important to remember and we talk about this quite often, that you can do something productive with your vacancy too, right?
You might have a week, you might have two weeks, and sometimes the initial is oh man, that's half a month with nobody in there, but you can use that time to do an extra deep cleaning or. Clean out the furnace or service the air conditioner. Take a good look at the furnishings, what needs to be replaced, right?
Do those things that you might be putting off. So I always try to say, okay, if we're gonna have a vacancy, let's do something productive with it, which really helps. I think you're exactly right. So there's a joke that there's only two kinds of drivers. The people who are going faster than you are crazy.
And people who are going slower than you are idiots. There's only two kinds of vacancies. Ones that are too shorter, the ones that are too long. The number of times where vacancies come up and we literally have the person empty the space by 11. The cleaners are there at 12. A new person comes in at three.
That's actually pretty typical, but five of those in a row. I haven't seen the house in a year and a half. Yeah. And so now I'm thinking, oh my gosh, if I can only have a longer vacancy, I can get in there and make sure that couch that we got, that we intended to only use for one stay and we're gonna switch out for a new one, would be switched out.
Yeah, there's only two kinds. There's too short, there's too long and I guess I'm never happy. I love that analogy. Alright hey, I've heard that, when you're becoming a new landlord, you get calls all the time about the toilet running or every little thing. Do you find that to be true with midterm rentals?
That is absolutely not true. In some ways I actually wish people would call more often. Part of the best job. Part of the, one of the best parts of this job is getting to know the residents and hearing what their stories are and what brought them to our little town. So I actually encourage them to reach out when they need to.
But for most of the residents, this is their home. This is where they're living for the next one month, three months, six months, 18 months is our record. Think of all the things that you would call someone for if it happened at your house. Not a whole lot of them. Yes. If there was to be an issue with water, I want to know about it immediately.
But if you can't find the dish rag, you open more drawers until you find it. You're not bothering your landlord about that. This is their home. And they treat it like that by and large. And that's actually one of the things that makes mt r so great is that you're dealing with people who want to be there.
By and large you're helping them out. They recognize that you're on their team. You're not, it's not an adversarial role that can sometimes happen in the long term space, particularly. No one's coming through in a bit of a predatory role, like sometimes in an STR space where people come through and they wanna have this big part and they only take about one or two guests and actually have 30, that's not gonna happen in MT.
R. This is a mutually beneficial thing for both the landlord and the resident in the MTR space and both sides respect that. I think if you treat people you know with kindness and respect they deserve, you get it right back. And you're not getting those two o'clock in the morning phone calls.
But by and large, what happens, particularly with the nurses, they leave the space better than they found it. The number of times they've called and told me, oh yeah, there was a screw loose. And so I went out to my car and you're a nurse. Why do you have a screw? Why are you traveling across the country with a screwdriver?
Because they leave the place better.
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I will also. Leave a toolkit for my tenants because oftentimes if something is loose or anything, I'll let them know Hey, I'm happy to come in or send the handyman or my brother, or whoever it is to tighten these things up. Or if you don't want us to have to bother you here's a toolkit with the screwdriver if you wanna take care of it.
There's no pressure, but just giving them the freedom. And oftentimes they appreciate that just so that they can access. Access, things like that too. Alright, so another one that we often hear in our Facebook group of, if you're not a part of it, it would be great to join. There's over 150,000 members in our Furnished Finder Facebook group.
We've got our Landlord Diaries Tools, emails. We keep you up to date in so many different ways, but if you wanna ask questions or see conversations, it's a great resource and oftentimes you'll see. Ooh, I just don't think I should be pet friendly because pets cause a lot of damage and from Katie and I's experience.
That's not true. And around 30% of furnished find are travelers bring their pets because they're not just going outta town for the weekend they're for months. To say, and you don't wanna have to find a doggy sitter or a cat sitter for months at a time. You want your friend with you. So what have you seen as far as being pet friendly and that idea that pets are always gonna damage your property?
So I have definitely not seen a lot of pet damage or any pet damage to speak of at all. What I have seen is a lot of residents who are coming through asking about, Kim, can I bring my animal? Can I bring and we've had cats and dogs and fish and birds, and anything that, that walks, crawls, swims, hops, any of that stuff has come through when people are coming to travel they are coming biologic in for work.
And so the question becomes what's the cost to them to take that job if they have to leave Fido back home. At $35 for a half day times two times 30 they can't afford to travel and leave the pet behind and actually make money when they come to your town. So traveling with the pet is not just a, oh, I like my pet.
It's a financial necessity. It's underpins the ability for them to come to your town and work. But a lot of people in the MTR space do have an understandable worry about pets. Close off their listings. If you are the one listing or one of several listings in the area that offers pet friendly amenities, they're gonna flock to you.
You're gonna be the top. There's no easier way to move yourself higher in someone's estimation of where they want to stay, then allowing them to come with their pets. It makes sense for 'em emotionally. It makes 'em with them financially. It's a home run to open your doors to them. And if you properly protect yourself, you can.
You can be very limited in your downside and experience a huge upside. I think that's the important part, right? Is it's okay to still protect yourself. You can have a pet deposit, you can have a pet fee, you can have a normal deposit. At our properties we've actually implemented a pet cleaning fee because we want our cleaners to wipe the baseboards extra good, and we want them to vacuum.
Three times and we want them to vacuum the upholstery really good. Versus if you don't have a shedding pet, you just don't have to do that as much. In my house we have four shedding pets at my house. We are vacuuming every single day and I know it takes more. So you can still protect yourself and not just have to knock on wood that something happens.
Because if you take accept pets for years after years, something will probably happen at one point. It's just the nature of animals. Just making sure you have that protection. Yeah. You know you're gonna have things from time to time, but be prepared and know that they're rare. It's not gonna happen all the time.
These people take really good care of their pets. One of those interesting conversations is what size property should I buy for monthly rentals? And you'll get a different answer all over the country and even within one general area. It's like each host has what fits their needs best and just some Furnished Finder.
Facts is the average number of tenants per booking is two to three, and relocating families is actually one of the fastest growing tenant types at around 185% growth year over year. Miguel, what have you seen is, your perfect size midterm rental, or do you just like a variety and they all work out great.
So I I'm an interesting person to ask because we certainly started small, went huge. Now we're back into medium. We have a three bedroom that we're arbitraging. I think it really depends a lot on what your area attracts. If you, if the only thing going on in your town is a level one trauma center and there's no construction and nobody's moving in to buy a house and there's nobody.
Who experiences a fire or a flood? Stay in small, makes total sense. Get a studio, get a one bedroom, get a upstairs, downstairs duplex that has a smaller unit downstairs and a bigger unit upstairs. It really depends on who's coming to visit and why. But for us, we have the same great occupancy between our smaller units and our larger units.
We have great great people we attract, come, stay are all phenomenal. So it's not something that, that, I think there's a perfect space. There's just what fits what you wanna manage or what fits what, what works for your market. So I don't think there's a one size that is the perfect one.
It's kinda who do you like to date? Maybe you like taller or shorter or whatever, it's just what fits your personality? What about the comparison of the ROI, the return on investment for smaller units versus larger units? Have you seen a large difference or is the ROI similar?
So our and I'm not A-A-C-P-A, so bear with me, but our return on investment is about the same between all of them. What will be different over the long term is how much appreciation occurs. So you can imagine if you have a more expensive property that goes up by 2% a year. Over time, the actual number of that property going up versus a smaller, cheaper property going up by the same 2%, there's going to be a widened the gap at the end.
That doesn't mean necessarily that one's a better purchase to make, but there are gonna be differences there. Now you might get more money in the short term per square foot on a smaller property, but that's not the only reason you own property. That long-term equity growth is probably better on the larger units if you can fill them, because you want to make sure you can have the residents that are coming through paying your mortgage for you.
That's the whole. I really like how you mentioned of what's good for your area, right? If there's a level one hospital, are you close to that? Is there a lot of construction? Is there, you know what's going on? And revolve your decisions. Especially regarding size around that. Because that's gonna be different, even just looking at the three of us for all three of our different markets.
In one of my markets, they're starting to build a whole lot of data centers and I know that they're gonna be bringing in crews that probably don't mind all bunking up together, if it's gonna save a little bit of money. But there's also. Some really great medical campuses and hospitals.
So it's just, it's, this is where you really need to get to know your market. And also, I also like what you mentioned about your investment goals, right? Are your investment goals more the cash flow? Maybe you're on a smaller property trend, are your investment goals long-term equity growth? Then, yeah, maybe it's a larger property, so I think that, size is not success, but rather it's strategy that is success and getting to know your market.
And that doesn't have to be difficult guys. It can just be getting active and learning what's going on. I think an interesting about the market also. As somebody who is active in a couple different communities of MTR investment, we kind of bounce ideas off each other. I'm an outlier in that I'm gonna, I'm in a smaller market Gainesville as a town is about 115,000 people.
It's not a huge city. It's not a tiny city, but Atlanta is just the south of us by about an hour, and that's the greater retro, greater metro area is about six and a half million people. Most everybody I know in these communities they're in Denver, they're in la, they're in San Francisco, San Diego.
They're all over these huge Houston, Dallas. Texas is a great place for an NPR. People forget about the smaller communities. You can get into a smaller community at a cheaper buy price. There's still a tremendous need for people moving to the area to do work to the older couple who's downsizing is looking to buy a house in the area, and they don't know what area they want.
They still want, they know their grandkids are nearby, but they don't know which neighborhoods the right one to buy in. So they find your place just for a month. And then they extend, and then they extend and they extend because it takes a while to buy a house. There are smaller markets that will allow you to do MTR just as well, or even better than trying to compete in larger markets.
Yep. That's a common topic that we've talked about on the show and that we hear about is that idea of travel nurses or especially, those skilled workers, like when the data centers are going up, there becomes this need for housing and there's not enough places. So jumping in and furnishing your.
Space for monthly stays is actually helping the community in a way that, continues to develop your area as well. Great point there. And, something that, to jump into the next myth we often hear, so I do long-term rentals or, I just, I'll be a first time landlord.
What about the furnishing costs like. Sure Furnished Finder is only $199 per year. That's nothing compared to the 55 times the return you can make. Especially within your first, like your first day, you make that back within the first week or two. But the furnishing is what holds everyone up with the idea of it's going to cost quite a bit.
Don't know if it's gonna be successful. So what re, what do you have for recommendations on furnishing a monthly stay? So I think a lot of that myth comes from the idea that there was a time when there was high-end furniture that was quality made. It looked gorgeous and was very expensive. And then there was the stuff I put together in my college dorm room that was not as high and not as, not quality made, but much, much cheaper.
I think companies like Manone have recognized that there is a need for something that is quality attractive, but also very reasonably priced. That will also last through multiple people using it. So yeah, the quality of the furniture that's out there has gotten much, much better at a lower price.
My wife is our interior designer decorator, and overall the brains of the operation on that side of the things. And she has an amazing job. She can put together a room a bedroom for about 2000, $2,500. All in, from bare room to mattress multiple protectors, sheets, multiple sets of sheets, quality sheets, the bed frame, all the decor kitchen, I think she said was 1500.
Some of the appliances are already there. It's not as huge an investment as one might think. Typically when we're trying to price out one of our new units that comes online, the goal is to, with the profits of the of that unit for the first year to completely pay back the furniture price.
So at the end of the year, at the very latest, we expect that everything going forward to be profit. One thing that I've also. Implemented in my own properties is we grew really fast. I think last summer we added five or six units, so we couldn't afford to even buy the quality of things that we wanted to buy.
I didn't know about Manone at that po at that point, but there was. Some sort of compromise with, we needed to buy some more budget furniture. And we did, but our approach was like, okay, we're gonna buy the core things really nice that will sustain. And then if we need to replace some things as we go, like that's okay.
It doesn't have to be that you furnish it once, you know from start to finish and you never, you never touch it again. You never touch it again. So you can constantly be making those upgrades and those updates and improve things as you go get feedback from your tenants. But I'm with you McGill.
We've gotten pretty strategic and we can do a studio apartment really nicely for, I wanna say about 2,500 to $3,500, right? Because you don't have to go crazy. You don't have to go crazy. 1, 1, 1 thing I will say about the idea of furnishing. It's become a bit of a hobby as we've gotten more units when there's a couch at our house that my wife would like to replace, guess what the living room of the next place is designed around.
So we'll buy our couch and then the, our couch now becomes the new couch. And so she gets to play chip and joint games, interior design specialist with our stuff. So our house is constantly under. That's where the drill came from. That's awesome. Nice. Alright, we've made it to our last myth and it's, once you get into those operations, Furnished Finder encourages landlords and it's expected on the platform that utilities are included that furnishings are included.
So if you're not going that route, you need to make it clear in your listing and in your booking process. But. The utilities, are they the tenant's problem or the landlords? Like how do you balance your utilities and make sure that you're, they're not being overused, but also that you're taking care of the tenant?
Yeah, so we absolutely cover all utilities, including high-speed wifi. Definitely wanna get the fastest wifi possible in the area. That's a huge draw. But the fear that I've bumped into with a number of the other kind of community groups, about NTR that I've seen is, oh my gosh, what if they come in and they just run up a $10,000 electricity bill?
Which I don't think is physically possible, but that's the fear. We have a clause in our lease. We, we know what last year's electricity bill was for that month because Georgia does have some seasonality in its weather. But if last year's utility bill for that same month is half of what yours was, you'll be assessed a fee for the difference.
So basically the idea being if you double last year's bill, there's probably a reason for it. You came into Georgia in July and you set the AC to 55 degrees. That is not a risk that we have to take as landlords. That was a comfort decision that the resident made, but clearly in the lease is a clause that says if you go over last year's.
Month adjusted bill by two x, you're gonna be charged a fee for that. Yeah. I think that's a very fair way to do it. And you just wanna, you wanna be clear about it, which sounds like you are. And there are areas of the country that have very high seasonal swings, georgia in the summer, the Midwest in the winter, up north in the winter.
Like you wanna prepare yourself, but be reasonable. I think two x the average is incredibly reasonable. And just being transparent. But it is like you've gotta include those utilities, you've gotta include the internet, include parking. When you can keep those fees minimal and transparent. And also quick reminder that with, when it comes to deposits when you're getting started in the space, you may think, oh, it's one month's rent, just like long-term rentals.
And you, if that's what you choose, you can, because you're in control, but you're likely going to be, have competitors that are at one third to one. One third to half months rent. So with that deposit in mind, you wanna stay competitive in your market. So we just recommend, checking the listings around you in your area to make sure that you are comparable.
But that's what we've seen as averages on Furnished Finder. Miguel, as we wrap up this episode I wanna ask when you're looking back. What's one mindset shift, one mindset shift that helped you treat midterm rentals like a real scalable business? That's a very interesting question because in some ways it was injury my back and being unable to be a surgeon.
Going forward. We definitely adapt to our situations and when there is a compelling need to change something we do. And so I'm very fortunate, my wife and I, we don't have to do the MTR to make a living, to pay our bills, to feed our children, to educate them. We actually leaned into it because it gives me a sense of purpose.
The ability to continue to serve is very important. I was five years old when I figured out I wanted to be a doctor. I was following my dad around the hospital. He's a physician. My mom's a nurse. They inspired me to go into medicine. And the idea of is our role to serve, not to be served was very important to me.
And because of an injury that was taken away, I couldn't do it anymore. We don't do this. Yes, it's nice to make a profit. We make a very good profit. It's nice to have the equity increase with in, in the portfolio. That's obviously very important. But the reason we do it is because there are people who are coming to our area that need a safe, good place to stay where they know they're gonna be treated.
Kindly and fairly unjustly and for me to, I'm 49 next month. For me to spend the next 20 years retired, staring at a wall was not something that appealed to me. MTR allows me the opportunity to do what I feel I was called to do as my vocation now and to serve people. Coming to town has just been a, an incredible blessing, and I can't thank Furnished Finder enough for allowing me the opportunity to do it.
It's been a tremendous privilege. We need more landlords like you on the platform, so come join the over 225,000 landlords across the nation that have seen the benefits of monthly rentals. If you want to connect with Miguel, you can check the show notes for the link to his Furnished Finder profile.
And we just thank you so much for tuning in. Don't forget to subscribe, share this with a friend, and we look forward to hopefully seeing you again next time. Bye everyone.
Thanks for joining us on this episode. If you're enjoying The Landlord Diaries, be sure to like, subscribe and share it with others. With over 300,000 listings across the country, burnish Finder makes it easy for landlords and tenants to connect direct. No middleman, no markups. Ready to list your property.