How to avoid vacancy gaps in midterm rentals?

Question

I have a midterm furnished townhouse in Chattanooga, TN.  I have my rental listed on airbnb, furnish finders and zillow.  My issue is renting out the townhouse and getting requests that cause odd gaps in between my bookings such as 3 and 1/2 weeks.  There is a STR moratorium currently in effect so I cannot fill in the gaps with short stays. I have a couple other rentals that are long term so I have not run into this issue.  Any advise on how to run a midterm rental without gaps would be greatly appreciated.

Allen Duan · Answer

I looked up one of my old posts that explains how we manage this challenge.

You've discovered what has been one of the biggest challenges to managing mid term rentals that we've had to deal with. On one hand, you want to open the calendar as much as possible to get the most eyes and leads on your listing. On the other hand, you don't want awkward bookings that create large gaps shorter than 30 days that you can get booked and lose income on.

I'm not aware of a setting in Airbnb that does what you're looking for. The solution I came up with is similar to what others have said above. I keep my calendar open very far out, but I use a pricing strategy that incentivizes bookings closer together with minimum gaps. If a booking does create a 2-3 week vacant gap, that booking would be priced at a premium to make up for the vacant 2-3 weeks.

A few points that I considered when crafting this strategy:

-I didn't want to turn off Instant Book because of the SEO hit on Airbnb. I operate in Los Angeles so there is a lot of competition and I want my listings in the top 3 search results

-I didn't want to close my calendar to only accept bookings that start in the next few weeks. I want to allow the possibility that someone searching for further out dates who has a higher budget can still find my listing and book it.

-By leaving the calendar open, my listings will show up in more search results that can lead to conversations with potential guests that may lead to a favorable booking. But if they never saw my listing with their search criteria, they'll never see the listing and send an inquiry.

Hope this is helpful. I'm happy to share more!

Rachel Gainsbrugh · Answer

Hey Sean! I totally get your frustration - we only do midterm rentals & can be a bit of a juggling act, especially when you've got those odd gaps between bookings.  Love the above comments!! Here's my add...

From my own experience, here's what's worked for me:

1.  List Everywhere: You've got a great start with Airbnb, Furnished Finders, and Zillow. But don't stop there! The more platforms you list on, the more eyeballs you get on your property. I've even had success with sites like CHBO, Booking.com (be mindful... there's some fraud from time to time)... and others as well

2.  Target Specific Groups: Think about who typically needs midterm housing ... although we focus on MTR Displaced homeowners (paid by insurance) we have 3 other midterm rental avatars we serve.... like - relocation, visiting higher ed, movie industry, contract workers, etc. There are even websites specifically tailored to these folks, like  which I've found super helpful.

3.  Networking is Key: One thing that's worked wonders for me is networking with local hosts, businesses, realtors, businesses and institutions.

every rental market has its quirks .... w/ a bit of research you'll master your mtr in no time.  Hope this helps!

Jerri Carroll · Answer

I own an MTR and I am a traveling healthcare professional who has rented MTR's in St. Louis, Boston, Omaha, Northern California, etc..  I have come across rentals that I was interested in that required me to start renting on the day it becomes available if I want the unit.  This alleviates the unit being open for an extended period of time.  For instance, I was looking for a place in Omaha to move in on August 15th.  The unit was going to be available starting on August 8th.  If I wanted the unit I had to start paying rent on August 8th.  I wanted the unit and so I started paying on august 8th even though I did not move in until August 15th.

Jamie Banks · Answer

Hi Sean,

I'd suggest picking a maximum time between bookings and sticking to it. I've fallen in the trap of taking whatever new lead comes in that has caused vacancies but it's not worth it in the long run. Establish a time frame you're comfortable with, for example one week, and tell potential guests that your policy is to have guests book within a week of the last move out, something along those lines. You never know if a guest is flexible on their dates. If you're in a market with good demand a new request will come soon, if not, you might want to allow for a 2 or 3 week gap and make sure to account for that in your vacancy reserves.

Jason Donajkowski · Answer

Hi Sean, I have ten MTRs in Chicago and certainly find controlling the gap days a challenge since I switched over from STR a couple years ago due to city restrictions.  The one month bookings out in the future always end up being a hindrance for more recent bookings.  I try to keep booked 3-6 months in advance and fill as we go.  Using FF as the main lead source for multi month stays but Airbnb works well fill one two month periods.  If there will be a gap more than two weeks before accepting I might advise them I have to bump the price up to help defray 50% of the gap time cost and if it still a good fit for them they will book it.  If they are a longer stay like over three months I might not charge them more. I also will inquire with the other guest (before or after the gap) to see if they want to extend any of those days at a 50% discount.  This has worked about half of the time.  If its a longer gap like 3.5 weeks we will just list the availability on FF and clarify clearly in the first line of the description what the actual availability days are, and list it at a 25% discount from normal.  It might work for a guest on FF if they are okay moving to another place after.  We have filled multiple gaps by moving the same guest from one place to another, maybe they have to mix in a hotel stay here and there if needed.  Takes a lot of responding to inquiries though to explain.

Nick Zupec · Answer

You already touched on my first thought which was using short-term stays to fill the gaps. We can't do STRs in my properties because of regulations either so we generally won't allow guests to book if it is going to create a large vacancy gap. We can usually get someone else (often last minute) looking for a place sooner. I would rather drop my price a little to decrease the vacancy period.

At the MTR Summit last weekend, there was a presentation by the CEO of PriceLabs showing some pretty cool functionality in this area. They have a tool for optimizing pricing strategies for MTR stays. You can watch a 1 hour webinar on it on their website for free. I don't use PriceLabs currently, but I might consider it. They allow you to build in rules like: for a stay of 30 or more days, I'm ok with a 5 day vacancy period max... for a 10 day vacancy period, I need a stay of at least 60 days, etc.

Lastly, I always increase my vacancy assumptions for MTRs. I set aside 5% of my rent in a vacancy fund for LTRs and 10% for MTRs. I usually don't actually get to 10% vacancy, but it helps me to not feel stretched when you do get those longer gaps. Hope this helps and good luck!

Bonnie Low · Answer

Where are you getting most of your bookings from? I only use FF for my midterms but I stay completely booked - almost to the point of having to negotiate between guests to allow enough of a gap to complete the turn. Of course, that's totally market specific, but I suspect the timing of the longer term stays you tend to get from FF lends itself to shorter gaps. All of my guests have been at least 13-week stays and I've had many request from people looking for 6 months up to a year. It may be that Airbnb and other OTA guests have shorter stays relatively speaking and that's causing your gaps? Just a thought.

Josh Edelman · Answer

I am struggling with this as I do Furnished Finder/Airbnb for 30+ days. I had a month vacancy and that was due to a fall out last minute by an applicant. I think it takes work to find a tenant prior to the end of lease. I would say try to time the leases so they line up with big movement periods.

For example in my city I know military move in and out in the spring/summer and fall timelines. I also know when new builds have buyers waiting to move in. I use this data to predict the higher demand seasons. Either way, its still a little riskier when it comes to vacancy if you are not in a high demand area.

Sean D. Thomason · Answer

Thanks all!!  I think one of the issues is that the townhouse is a 2 bedroom and 2.5 bath.  We get so many inquiries from FF for 1 bedroom with the 1 bedroom price.  There are definitely some strategies on airbnb that we can try based on the above advice.  I'm a little apprehensive but might venture out into a rent by the room situation since there are so many more requests for 1 bedroom.

Taft Sibley · Answer

Have you seen the most recent update on STVR from City Council? Check it out here:

https://www.timesfreepress.com...

https://www.chattanoogan.com/2...

How to avoid vacancy gaps in midterm rentals?

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