Have you considered listing your house for mid term rental but are unsure where to begin? Have you ever wondered how much you should charge for your property in order to make it profitable? Many people have asked me about this, and I want to provide the answer to the most common question that every mid-term rookie investor has.

Unlocking the Perfect Price: A Guide to Mid-Term Rental Pricing

Pricing your mid-term rental right is critical whether you're a seasoned property manager or a homeowner wishing to rent out your space for a few months. A smart pricing plan can help you strike the correct mix between affordability for tenants and profitability for you.

Some factors you may need to consider…

While the 1.5x multiplier is a good starting point, you should examine the following aspects to fine-tune your pricing strategy:

• Location: Determine the demand for mid-term and short term rentals in your area. If it's a popular location for short-term stays, a higher multiplier might be justified.

• Get your free 30 day trial using this LINK

   

Use Pricelab Market Dashboard reports

• Seasonal Demand: Consider whether the demand for your home varies according to the season. To capitalize on peak periods, adjust your pricing. If hotels and short term rentals adjust to season pricing, your mid term rental deserves that adjustment as well! Consider raising prices for March (Spring break), June-Aug (Summer), November (Thanksgiving) and December (Holidays).

• Property Features and Amenities: The unique characteristics and amenities that your property offers may influence its perceived value. A well-equipped, amenity-rich area might justify a higher multiplier. Include amenities for the type of client you want to attract. For example in my properties, some of them has an espresso maker and a good quality blender for making smoothies.

   

• Market Trends: Monitor market developments and rival pricing. If comparable homes are priced higher, you may be able to increase your multiplier.

• Utilities and Services: Determine whether utilities or additional services will be included in the rental. This can have an effect on the total perceived value and your pricing approach.

What you need to add up

1. Base Rent Calculation:

Begin with your long-term rental rate and multiply it by 1.8-2.0 to obtain the basis for your mid-term rental.

Understanding the 1.8x Multiplier

The 1.8x multiplier is a simple formula: multiply your property's long-term rental rate by 1.8. This serves as the starting point for your mid-term leasing rate. This multiplier is designed to account for the increased value and flexibility that mid-term rentals provide over longer-term arrangements.

2. Incorporate Additional Fees:

a. Pet Cleaning Fees:

This is to pay for a deep clean after move out as dogs can have dander and hair that is extra hard to clean. Usually, a reasonable surcharge is $150-250 depending on the size of the home. Don't be afraid to ask your cleaner what their pet cleaning charge is. Don't forget a pet deposit - $250-500 per pet is reasonable.

Determine a reasonable pet cleaning price that includes the costs of probable pet wear and tear. The pet cleaning cost should be separate from the base rent.

b. Security Deposit:

Some hosts that take direct bookings will charge upwards of one month. If you have a good damage protection program like Waivo or Rental Guardian, you could consider taking a lower deposit to attract renters. Also be careful to keep the deposit in a separate account. don't comingle funds!

Determine the amount of the security deposit. This is usually a refundable amount maintained in case of damage. Explain to tenants that this is a separate, refundable fee.

c. Mid-Term Cleaning Fee:

Determine a mid-term cleaning fee to cover the costs of cleaning during the tenant's stay.

Add the mid-term cleaning fee to the total rent. Remember that mid term tenants add more wear and tear than short term rentals so plan on an extended cleaning before move out.  CHARGE THE CLEANING FEE ON THE DAY THEY MOVE IN (OR WITH THE FIRST PAYMENT)

Consider these MTR Expenses

3. Include Utilities and Incorporate Additional Fees

Since utilities are often included, it's important to estimate the average monthly utility costs for the property. Set a reasonable utility cap to cover these costs. Calculate the cap based on the size of the home, the number of occupants it can accommodate, and the local utility rates.  Put the utility cap in your lease agreement.

a. Pest Control:

Great operators include pest control for their properties. Tackle problems before they show up and it will make your life a lot easier.

b. Lawn Care:

Estimate the cost of lawn care services for the mid-term rental period.

c. Snow Removal:

Estimate the cost of snow removal services for the mid-term rental period.

4. Final Adjustment:

Consider changing the final sum based on market research, competitive pricing, and the overall value of your home.