Hi @Christyn Budzyna
I own property here in State College Borough, some of which are standard rentals and some STR. We actually thought about doing what you suggested for the 8 month term and STR for football season as a way around the new restrictions. It could be a good option but you couldn't rent it to students unless you had a Student Rental Permit which they don't issue anymore. You'd have to acquire a home that already has a student rental permit in place but even then, as some others have stated, the students are here year round so an 8 month lease wouldn't work. Also, the abuse student housing takes would be a pain to maintain especially if using for an STR. We have a couple student rental properties and keep the student permits active for resale but don't rent to students.
There is a great rental market outside of students so getting someone in there for only 8 months is an option especially with it being a cute furnished rental. Another local real estate investor actually suggested getting contracts/leases signed with companies that have traveling nurses. Even with that you'd still have to make sure you have the proper documentation showing the long term lease and there is no telling how picky the Borough will get. We had to jump through hoops for our permits which I will explain next.
So at the moment we have 3 STR's in the Borough. Our strategy was purchasing single family homes with an inlaw suite or attached apartment, or the ability to create one. Since it's all in the same structure, we rent out the house to long term tenants with the understanding that the attached unit will be used as an Airbnb and we let STR guests know that the rest of the home is completely separate and occupied. We also flip flop this strategy and have a property with a long term tenant in the smaller unit and we rent out the main house as an STR. When applying for permits we had to show proof of the lease, copies of the tenants drivers license, tenant bills with address etc. as well as proof of parking spots with illustrations and google map images. Obviously we also had to make sure the home was up to rental permit standards. One of these properties has actually been rented to parents that use it for events and to visit their Penn State student. The Borough actually made them go in and sign an affidavit confirming their lease and use of the space. Nonetheless we went through all of the red tape and received the permit. Should the regulations change where we have to stop STR, we can rent out the former STR's as long term rentals.
If you want to avoid all of this the best option is to find something in a surrounding township in an area like Park Forest or Toftrees. At the moment, I believe there are no restrictions but that can change in the future. My suggestion would be to make sure that you have an exit strategy in place if the STR regulations were to change. Make sure your investment would work as either an STR or long term rental. We charge a premium for our SF rentals because we put in the effort and make them look good. The majority of rentals in the area are just okay so if you can make yours look cute so that it stands out from the rest you can get more for rent plus you'll attract better tenants.
If you have any questions please feel free to reach out. I'm also a Real Estate Broker so I am very familiar with the market here. Hope this helps! :)
