Analyzing an MTR market

[Assaf Lowenstein]

Good morning and happy 2023!. 

How do you analyze a market for potential rent and desirability? 

I'm analyzing an MTR market in Arizona, looking for potential rent and desirability and I'm getting some mixed signals. 
Agent says that a TN told her that "market doesn't have a lot of options so nurses are not applying". I do see very little inventory in FurnishedFinder and prices for a room are ~$500. 

What's a good way to learn more about desirability of location and potential rent beside FF? any other recommended sources?
I was thinking calling the local medical centers and talk to whoever coordinates TN or is doing recruiting. 

Thank you!

[Victor Steffen]

Hi Assaf,

For MTRs we look for areas where any 3 of the following 6 industries are within 10 minutes of each other: General Hospital System, International Airport, Military Base, Major University (20k+ students), Metropolitan Tourism, Fortune 500 Companies. 

All of these are a draw for mid-term tenants and will help ensure occupancy. Post your MTR on airbnb and limit it to 30+ day stays, furnished finder, or even local facebook groups. We have success with all platforms.

A fully furnished MTR should be trading 25%+ above LTR rates- if you're not seeing that in your market there's likely not enough MTR demand to justify the model.

When you purchase a MTR be sure it will at least cover your PITI if you need to convert it to a long term rental. If you invest where there are overlapping MTR tenant attractions then you won't have issues with occupancy. Just keep the space clean and don't over-extend. Most MTR tenants are single or at most a couple. I personally think 3 bedroom houses are overkill. Our most successful MTRs are a mix of 1 and 2 bedroom fully furnished quadplexes.

Good luck!