Did you know that renting your unit as a traditional residential rental is actually the least profitable way of operating a landlord business? While it may be reassuring for landlords to operate on 12-month and 24-month leases, it’s entirely possible to make even more money from your rental unit—all while retaining similar security.
That’s right. You can make up to 8-10x more money each month with corporate housing, according to Landlordology.
But what are the similarities—and the differences?
For starters, corporate housing is much like your traditional residential rental. However, instead of renting unfurnished properties to individuals, landlords typically rent furnished apartments or homes to businesses. And generally, utilities and all other services are included in the rental price. Think of it as all-inclusive hotel or resort, minus the room service or housekeeping.
One of the major differences with corporate rentals are the duration of leases. Whereas residential rentals generally rent for longer periods of time—six-months, a year, and two year leases are also popular—many corporate rentals can be considered short-term or temporary. Think 90+ days.
As assumed, these type of leases appeal to a specific demographic. More often than not, white- and blue-collar employees choose short-term housing while on assignment. From traveling nurses to construction workers, these professionals often seek an environment that feels like home. Additionally, insurance and disaster relief companies may also house displaced families for extended periods of time.
So why is corporate housing so profitable for landlords?
As mentioned, there are innumerable situations where individuals really only need housing for three-to-six months. In these situations, renting a hotel can be extremely costly, and renting a unit for a year does not make sense logistically.
That’s where your property fits in.
By offering a short-term rental for 40-50% less than the average price for a month stay in a hotel, you’re not only saving prospective tenants money, you’re making more than you would over the duration of a one-year lease.
Think about it. If an average hotel room is $100, and you offer $50 per night, per person, for a three-bedroom house, your price per individual will hover around $150 per night—or $4,500 total per month. Compare this to the average monthly rent in your area, and we can guarantee that you’ll come out on top.
It’s not all cost savings, however.
Outsourcing your corporate housing needs to an expert provider also reduces vacancies, increases visibility, and guarantees that you’re paid on time. Listing your property with a short-term housing provider enables you to get noticed to an extensive network of business travelers. And it ensures that you remain competitive with market trends, property analytics, and a dedicated support team.
Travelers Haven signs leases, coordinates change requests, and oversees all vacancies. Not only will you be making more money, per month, your rooms will be filled.