Columbus/Tulsa/Huntsville - LTR vs. MTR?

Question

Hello BP community! I'm just starting out and considering the following markets for a potential OOS investment property. Anyone have insight on these being better markets for traditional long term rentals vs. 30 day minimum extended stays / MTRs? Will both strategies work in these markets? What are the tradeoffs to consider? (Note: right now I am not considering STRs).

1/ Columbus, OH

2/ Tulsa, OK

3/ Huntsville, AL

For additional context, my main goal is to invest in a market that allows me to cash flow AND build appreciation over time. Given the uncertain macroeconomic environment, I'd also really like to find a market where multiple investment strategies can be used to mitigate risk should I need to pivot quickly. For example: being able to turn a mid term rental --> traditional long term rental if needed or vice versa, without losing significant cash flow.

I'm also open to considering other markets that might meet this criteria. Any insight here is greatly appreciated, thanks in advance!

Nate Sanow · Answer

I think it’s worth noting that when you mention a city, a lot of us get hit with a “keyword” notification and the way BP has gotten often that turns into “selling” you our market(s). So with that disclaimer out of the way… Tulsa is a fairly safe bet. The other markets might be as well, but what I know about my market is we saw 2% appreciation throughout our mls last year despite the national news of real estate being in a decline… we are so insulated from the “bubble” conversation. Now, on the inverse, I’ve been calling out insane rent growth on a local level especially because we have a ceiling of wage growth. I want to be wrong here. I want an employer to come in with 9000 6 figure jobs. But our median household income is roughly $50,000 depending on which google search research you look at.. I find this to be a relevant income level for most of our tenant pool, unless you’re focusing on our A class areas of course…. (But A class usually doesn’t cash flow because you compete with owner occupants to acquire). So what I’m saying is, we aren’t that bad and we aren’t that great. We do cash flow, we do appreciate, and we don’t crash that hard when the rest of the nation does. I jokingly say it’s because we are already near the bottom :-) my colleagues don’t always love that. You should check out all 3 markets and interview a lot of folks. I’d love to be one of them in Tulsa and am here to have a conversation if that’s of interest. I do have all my eggs in this basket because I do believe that we are growing and improving ahead of many comparable midwestern states.

Lindsay Davis · Answer

Hey @Ashley Wong,

I don’t have much insight into Columbus or Tulsa, but I run a turnkey provider in Huntsville and can vouch for the area—for two reasons.

First, Huntsville’s strong demographic headwinds have led to steady and sustainable population growth (+20% in the last decade), while the city’s abundance of high-quality STEM jobs—brought to the area by industry heavyweights like Dynetics, Boeing, FBI, Redstone Arsenal, Blue Origin, and others—have attracted numerous well-heeled millennial renters.

These factors make the city a honeypot for investors looking to strike a balance between cash flow and appreciation potential, and positions Huntsville as a good option for either medium-term or long-term rentals. Generally speaking, however, LTRs command more stable cash flows over time than MTRs or extended stay arrangements, and may be the better (and lower-maintenance) choice for someone just starting out.

John Mullen · Answer

I can’t speak as much to OK or AK, but Columbus is one of the few metropolitan areas in the post-Covid US whose downtown life has fully bounced back.  The city also enjoys consistent annual population growth and ongoing large business activity/investment.  I’m guessing you know this already haha.  But that benevolent cycle, which is about a couple decades old, means that lots of neighborhoods are up and coming after being down and out for decades.  I’ll give examples South and East of Children’s Hospital.  Some neighborhoods in that area are fully gentrified (German Village), some are strongly in process/nearly fully there (Merion Village), and some are on the cusp and are currently a mix of flips/rentals and more dilapidated properties (South Side). If you position yourself on the outer edge of that moving path of progress, there could be opportunities for STR/MTR/LTR all in the same neighborhood, which gives you that desired strong pivot-ability.  Hope that helps!

Remington Lyman · Answer

I think Columbus, Ohio is good for both

Michael S. · Answer

@Ashley Wong - everything @Lindsay Davis pointed out is accurate here for Huntsville.

However, deals are few and far between here;  prices have not profoundly plummeted, interest rates are still high, and quality inventory is scarce.

We bought less in 2022 than ever before simply because the numbers did not work.

Pavan Ra · Answer

Hi Folks, not sure if this thread is being monitored,  but I have a couple of single family homes in tulsa that i'm trying to rent out as a mid-term rentals (to traveling nurses etc). I'm trying to find a property manager that handles mid-term rentals and will also need help with furnishing the properties. Is there anyone on this forum that provides these services?

Ashley Wong · Answer

It seems like each market has its own set of tradeoffs to consider and it ultimately comes down to what I'm optimizing for at this stage of my investor journey. Thanks all for the detailed market insight! The BP community has been incredibly helpful for a newbie like myself and I appreciate everyone who has taken the time to comment.

Remington Lyman · Answer

Both of those boths

Ashley Wong · Answer

@Remington Lyman to clarify when you say that Columbus is good for both - by "both" do you mean LTR and MTR? Or cash flow and appreciation?

Columbus/Tulsa/Huntsville - LTR vs. MTR?

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