Trying to decide on MTR/STR/LTR

[Tim Griffiths]

I have just closed on my first property and originally when we put the offer in we thought we would do a medium term rental, with airbnb filling in the gaps if possible.  The house is near a hospital, Lake Ontario, there's also 3 factories nearby and a state college.  It's a small city, though, so none of these are huge on their own. But we figured we could make it work both in the tourist season and by working directly with the large employers in town.

We then had a friend ask to rent it out, as they were living with mom and had just gotten divorced.  Fine, we thought, young professional, we know they make a good living and their background was known.  Fast forward 3 months later and the prospective tenant is no longer happening; once they realized I wasn't going to rent at a loss, they suddenly couldn't afford it.  The market has changed since 2018 but they don't seem to get that.  I'm pretty annoyed and now not sure what to do.  I went on furnished finder and there's almost no listings for available property in my city.  Is that a red flag or a sign that the demand is high?  In April there were a lot more listings.  It's a lakefront town that gets lots of tourists in the summer to mid fall.  

So, I don't even really know the questions to ask, to figure out what to do.  I'd like to provide a needed service in the town and don't want to dive into the college rental market if I can avoid it.  Any hints on what research I can do to figure out what is the best strategy?  I am struggling to find hard data on my town; real estate seems a bit old school here.  

[William Powell]

If the house is nice and people see you working on it prospective tenants should be doing ride-bys. Asking to speak to the owner and asking you rent questions. This happens to me even in small towns. If you didn't do any fix-up or it's complete and no one saw you working, stick a FOR RENT sign in the yard to gauge interest. This lets you know if you can LTR. You can keep these names but pull your sign and try for MTR. If MTR/STR doesn't make enough income revert back to LTR. This is my strategy for one I'm doing in a small town. I recommend you push your first plan hard before you throw in the towel. Near a hospital, plus marketing plus nice furnishings and home equals good customers.