You can either cancel and they may reduce the fee to try to save the deal or take the hit and leave a foul review so people know of this bad practice 

The problem with rent by the room is you end up becoming a counselor or a people manager.

People need homes.

Do you like to do business with people trying to do a workaround?

Do people put exercise equipment like treadmill or stationary bike in their mid term rentals?

I've heard too many horror stories about people that pay cash for a property because they think they are getting a deal.A moron of an owner could see they could get a much higher price if they just put in the exit signs (etc) and then sold to someone with a bank loan. 

You will probably find some people here with experience in or around where you wind up.

Staffing key people already there, front desk person, accounting person, all the third party vendors you need, all the training you need for your agents.All you do is recruit and sell. 

People find the best schools and look for houses around that school.You should start with the state and then drill down.

Pick a place where lots of people want to rent, the houses are cheap, and there's a chance for growth.