Austin and surrounding areas for mid-term rental

Austin, Texas
Medium-Term Rentals
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Austin and surrounding areas for mid-term rental

Heather Rummel
Member since 2021 · 5 posts · 3 votes

Hello Everyone!  My sister and I plan to buy our first property together in the Austin, Tx area in the $400/500k range.  We are leaning towards doing a medium term rental (30+ days but not a regular 12 month lease).  We plan to do this so we can utilize a vacation home loan for our first property (we will stay there occasionally).  Curious if anyone has any thoughts on a good location for this.  I don't know the area well and will be leaning on our property manager and realtor for help but I'd love to hear from this group as well.  Thanks so much for any advice!

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Conner Olsen
Real Estate Agent · Austin, TX · Member since 2020 · 1k+ posts · 941 votes
4y

@Heather Rummel Like Jordan said I have a monthly rental by the Domain. I have seen that you can make this strategy work in Austin and the immediate suburbs. I'd make sure the property manager is familiar with monthly rentals. Many property managers charge 20%+ for anything short-term rental related and at that point you probably wouldn't cashflow. 

For 400k-500k you can expect $3,000-$4,500 in gross revenue depending on the area. Airbnb will take 3% of revenue as a platform fee. For a 3/2 you might have $400-$550/month for utilities and $10k-$15k in furnishings. Hope that helps!

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  • Jordan MoorheadBusiness Member
    Real Estate Agent · Austin, TX · Member since 2015 · 5k+ posts · 3k+ votes
    4y

    @Heather Rummel there are lots of great areas for this! I'm currently doing one in East Austin and one in South Austin off William Cannon and @Conner Olsen on my team is doing one just North of the Domain also. 

    You just don't want to be too far out to make these work

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  • Conner Olsen
    Real Estate Agent · Austin, TX · Member since 2020 · 1k+ posts · 941 votes
    4y

    @Heather Rummel Like Jordan said I have a monthly rental by the Domain. I have seen that you can make this strategy work in Austin and the immediate suburbs. I'd make sure the property manager is familiar with monthly rentals. Many property managers charge 20%+ for anything short-term rental related and at that point you probably wouldn't cashflow. 

    For 400k-500k you can expect $3,000-$4,500 in gross revenue depending on the area. Airbnb will take 3% of revenue as a platform fee. For a 3/2 you might have $400-$550/month for utilities and $10k-$15k in furnishings. Hope that helps!

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  • Eric Gabbard
    Austin, TX · Member since 2017 · 19 posts · 7 votes
    3y
    Quote from @Jordan Moorhead:

    @Heather Rummel there are lots of great areas for this! I'm currently doing one in East Austin and one in South Austin off William Cannon and @Conner Olsen on my team is doing one just North of the Domain also. 

    You just don't want to be too far out to make these work


    What would you consider too far out of the city for a MTR to work? I have a 4/2.5 home off of Slaughter that I'd love to turn into a mid-term rental. I haven't found a great way to figure out what the demand would be.

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  • Jordan MoorheadBusiness Member
    Real Estate Agent · Austin, TX · Member since 2015 · 5k+ posts · 3k+ votes
    3y

    I don't think that would be too far @Eric Gabbard, do you @Conner Olsen?

    [email protected]512-888-9122
    The Moorhead Team5140 Reviews
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  • Conner Olsen
    Real Estate Agent · Austin, TX · Member since 2020 · 1k+ posts · 941 votes
    3y

    @Eric Gabbard @Jordan Moorhead There's definitely still demand on Slaughter. I just sold a 4-plex last month to clients looking to MTR off Slaughter. I made a youtube video on how to determine rates and demand for MTR on Airbnb! 

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  • Eric Gabbard
    Austin, TX · Member since 2017 · 19 posts · 7 votes
    3y

    Appreciate you both! 

    @Conner Olsen can you link your YouTube channel so I can check out the video?

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  • Eliott Elias
    Investor · Austin, TX · Member since 2021 · 9k+ posts · 5k+ votes
    3y

    Medium term rentals attract a different clientele than STR. I would try to buy around company headquarters like Apple, Dell, Samsung, Google. Get those clients who are on assignment and don't want to be held to a one year lease

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  • Maria Hernandez
    Austin, TX · Member since 2022 · 3 posts · 4 votes
    3y

    @Conner Olsen I'd also love to see your YouTube video! Can you please post a link? 

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  • Harmon Raef
    Member since 2022 · 6 posts · 2 votes
    3y
    Quote from @Eliott Elias:

    Medium term rentals attract a different clientele than STR. I would try to buy around company headquarters like Apple, Dell, Samsung, Google. Get those clients who are on assignment and don't want to be held to a one year lease


     Are you relying solely on airbnb and furnished finder to find those clients on assignments?

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