Justen Brown, a successful real estate investor with more than 100 properties spread across six states, tells the tale of how he entered the business at the age of 16 and amassed a diverse portfolio that includes condos, small multi-family homes, commercial properties, mixed-use properties, and sizable apartment complexes. He just recently learned about the growing midterm rental market, has purchased his first property for just this purpose, and is already full of useful tips for anyone considering getting into midterm rentals as well.
Justen learned a lot about the real estate industry from his older brother while he was in high school. As his interest in real estate grew, he made it a goal to graduate from high school with a real estate license. He was able to buy his first property when he was 18 years old because he was frugal in his teens, saved a large portion of his income, and had good luck with very lax lending rules. He admits that purchasing his first property was intimidating, but after reflecting, he realizes that sometimes the best course of action is to just dive in and fine-tune your business as you go. Better than perfect inaction is imperfect action.
The Growing Midterm Rental Market
Justen had never heard of mid-term rentals until about 6–8 months ago. He's been obsessed with Furnished Finder and the mid-term rental market ever since he learned about them. He purchased his first property, a small cottage home in La Mesa, California, and began the process of preparing it for mid-term tenants. Because this was his first time doing something like this, he needed some hands-on experience. Fortunately for him and anyone just starting out, there is an abundance of resources and people willing to help.
You can listen to Furnished Finder's podcasts, visit the Property Owner Resources (opens in new tab)page on FurnishedFinder.com, and join Facebook groups dedicated to the mid-term rental market and its tenants. Travel Nurse Housing - Furnished Finder (opens in new tab)is a Facebook group worth joining. This group, which has over 100,000 members, is a great place to learn about what travel nurses are looking for in a mid-term rental. Travel nurses aren't the only tenants in the midterm rental market, but they make up a sizable portion of it, and if you can meet their needs, you should be able to meet the needs of any other midterm renter.
He values the Furnished Finder community of other hosts, as well as the assistance provided by the Furnished Finder staff in optimizing his properties' listings and improving his properties to truly impress his tenants. Don't be afraid to ask for help; if you don't, you'll never achieve the level of success you desire. Remember that there will always be someone more advanced than you. Ask around on Facebook groups, and you'll be amazed at how quickly and helpfully those in the midterm rental markets respond.
Problems are just Learning Opportunities
As a landlord, you must recognize that problems are simply disguised learning opportunities. Every problem, whether it's a dripping faucet or a difficult tenant, presents an opportunity to improve and refine your processes as a landlord. Rather than becoming bogged down by setbacks, it's critical to approach each problem with a growth mindset, taking the time to understand what went wrong and how to avoid it happening again in the future. These challenges will only make you a more experienced and successful landlord in the long run.
Justen has no qualms about providing his cell phone number to his midterm tenants. If they have a problem, they can get in touch with him directly. He then contacts someone on his property's support team, whether it's a plumber, electrician, landscaper, a pest control company, or someone else, and has them handle it right away. Once the issue has been resolved, he focuses on determining how to avoid it in the future.
Considering Mid-Term Rentals?
If you're thinking about using a mid-term rental strategy, a good place to start is by determining the demand for furnished housing among traveling nurses in your area. FurnishedFinder.com's free Travel Nurse Housing Demand Calculator (opens in new tab)makes this incredibly simple. Knowing the level of demand in your area for travel nurses can help you decide how much to charge for rent, what amenities to include in your rental, and how to market your property. For example, if travel nurses are in high demand in your area, you might be able to charge a higher rent and include more premium amenities in your rental. If demand is low, however, you may need to be more competitive with your pricing and amenities to attract renters. Furthermore, by understanding the demand for travel nurses in your area, you can identify areas where housing options are scarce and market your property accordingly.
Concerned about the Cost to Furnish?
Many property owners who are accustomed to renting to long-term tenants may be hesitant to consider renting a furnished property due to cost concerns. Furnishing a property can be expensive; however, keep in mind that a furnished rental is expected to command a higher rent and quickly offset those costs. It's also worth noting that renting a furnished property often reduces the risk of property damage because renters are less likely to bring their own furniture, which can cause wear and tear.
For property owners looking to furnish their property on a budget, using furniture rental services such as CORT Furniture Rental (opens in new tab)can be a cost-effective solution. Property owners can avoid the large upfront cost of purchasing furniture outright by renting furniture on a monthly basis. This is especially useful for property owners who are just getting started in the rental business and do not have the cash flow to make a large purchase. Furthermore, by renting furniture, property owners gain the flexibility to change the furniture in their rental properties as needed, based on the preferences of their renters. This allows them to keep the property looking new and modern, attracting more renters. Renting furniture also allows the property owner to test the demand for the furnished option prior to making a large investment in furniture. Depending on the occupancy rate and the income generated by the furnished option, this can help them make an informed decision about whether to invest in furniture in the future.
If your property is currently vacant, you can still create a listing on Furnished Finder using pictures of your unfurnished property (just mention that furniture is still to come). You will have access to tenant leads and will learn what price points travelers in your area are looking for once you have a listing live. With that information, you can make adjustments to your furniture budget, furnish your property and update the listing's pictures.
You're Never Alone
If you're still unsure about jumping in, don't be afraid to reach out to other midterm rental property owners and just ask them how it's going and if there's any advice they can give you.
If you search "Furnished Finder" on Facebook, you'll find a number of groups you can join aimed at the mid-term rental market. One group in particular, Travel Nurse Housing - Furnished Finder (opens in new tab), now has over 100,000 members, and you can see what other travel nurses are talking about, what they're looking for, and their concerns and questions. Doing so allows you to better understand this potential tenant group and makes it easier for you to impress them when they start renting your property.
Goals for Your Property
Justen currently has a property, and he wasn't sure if he should rent it long-term, mid-term, or flip the property. Either way, he needed to figure out which route best fits his strategy and long term goals. For him, he's looking for $500–$1000 in positive cash flow from his property, so he opted for the mid-term rental model.
He keeps in mind his distinction between being rich and being wealthy. Being rich may come from flipping houses left and right and having a large bank account, but this may come at a cost in terms of time and effort. Compare that to his vision of wealth: hundreds of rental properties that can cover all of his living and travel expenses, plenty of money to play with, and all the time in the world to spend with his family.
You may not need hundreds of properties to reach a level of wealth you'd be happy to live with. Justen refers to this number as FIRE: Financially Independent Retire Early. How much income do you need to be happy? With this number in mind, you can do some simple math to figure out how many properties you would need, assuming they all yield similar cash flows, to reach that FIRE number.
In conclusion, Justen Brown's story of how he entered the real estate industry at the age of 16 and amassed a diverse portfolio of properties should serve as inspiration to anyone thinking about getting into the business. He recently learned about the expanding midterm rental market, purchased his first property for this purpose, and is already finding success. He emphasizes the importance of taking action, even if it is imperfect, and viewing problems as opportunities for learning. He also emphasizes the importance of seeking assistance from others and participating in Facebook groups dedicated to the midterm rental market. He concludes by encouraging readers to set their own property goals and consider what it means to be truly wealthy.