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How To Profit from the Booming Mid-Term Rental Market in 2021

Coronavirus Has Accelerated the Rise of the Mid-Term Rental Market by 5-10 Years


We've all heard about how coronavirus has accelerated the future by 5-10 years.


There's been plenty of of thought leadership on the acceleration of everything from technology adoption to e-commerce to work-from-home to remote school to cryptocurrency to the rise of China.


However, what hasn't been talked about enough is the acceleration of the rise of the furnished mid-term rental market and what that means for hosts, homeowners, and property managers.


Remote work is killing the traditional long-term unfurnished 12 month lease.



Millennials, like myself, just don't like long term commitments. We value flexibility. We value experiences over possessions. We tend to have more jobs where we can work remotely. We don't have sentimental attachments to furniture or decor. We value exploring new places and having a backdrop to our daily lives that provides novelty. Home is where our laptop is!


Coronavirus has forced millions of new people and companies to try remote work for an extended period of time. Now that companies are realizing the efficiency gains, increased employee happiness, and cost savings work-from-home offers, this is trend will last long after Coronavirus is over.


Everyday people are waking up to the fact that they are free to work from anywhere and live from anywhere for any period of time.





Remember how the advent of Air Conditioning forced a major population shift to the South since all of the sudden hotter climates were all of the sudden livable year-round? Well, now the internet and the rapidly increasing feasibility of remote work/school is forcing a major population shift from cities to rural/suburban areas. Not only that, people are now realizing they can try a place out for a couple months before making a commitment.


The Mid-Term Market is The Sweet Spot Between Short Term Rentals and Long Term Rentals


At the same time as the long term lease is slowly dying, short-term rentals have suffered due to Coronavirus. They are less lucrative, more risky, less dependable, more stressful, and less profitable than before the pandemic.


The savviest property managers and real estate investors are positioning their businesses to take advantage of this mid-term rental trend in 2021.


Mid-term renting provides a happy-medium strategy for residential real estate investors wanting more yield than traditional long-term renting but less work than the short-term route. In other words, Mid-term rentals are a lot less stress and effort than Short Term Rentals, while providing similar profits in many cases.


The mid-term rental strategy also mitigates some of the difficulties presented by short-term renting, such as local regulations and a heavy work load due to frequency of tenant turnover and potential for unauthorized parties.


Here are some examples of the use cases for mid-term furnished rentals:

  • Travel nurses

  • University students and interns

  • Digital nomads

  • Recent grads

  • Relocating individuals and families

  • Traveling professionals

  • Work-From-Home Families

  • Retirees

Mid-term Properties that are only listed on Airbnb will be outcompeted due to new alternatives.

I've talked about it before on this blog. Airbnb leadership are also big believers in the Mid-term revolution. Brian Chesky, the CEO of Airbnb, believes "long-term stays" will be a major part of Airbnb's growth story in the years to come. Here are some of the things they've been doing to adapt to the trend:


There's no doubt that listing on Airbnb provides a ton of leads. The problem is that finding mid-term renters on Airbnb carries longterm platform risk and comes at an enormous cost to hosts.


First off, there is the platform risk of an Airbnb customer service rep being empowered to kick you off their platform at the drop of a hat for violating their ever-changing community rules that are wide open to human interpretation. We've highlighted some examples of this happening before in the newsletter, where a host with multiple properties and great reviews wakes up to see all their listings have disappeared after a sociopathic guest complains to Airbnb about the host.


But even worse than that giant risk, the 15% service fees end up being $100's or even $1000's over the course of a medium-term lease. To make matters even worse, since Airbnb has deals with local and state governments to automatically collect/remit taxes, there is no avoiding those - even on stays longer than 31 days! So that means, oftentimes renters must pay 15% in service fees PLUS another 10%+ in taxes.


It's not going to get any better either. Now that Airbnb has IPO'd there will be increasing pressure from Wall Street to boost quarterly profits. This will likely come in the form of more service fees and charges.



As an example of the surprising difference in revenue for the host, let's look at this furnished 2 month rental.


Even though the below rental more than a 31 day rental there are still $835 in short-term-rental occupancy taxes being automatically charged to the guest. Additionally, between the host and guest there is a 15% service fee.

The same booking on Kopa for the $3761/month would be a total savings of $1509 for the renter. That is an enormous difference!


This means people using other platforms such as Kopa, Facebook Marketplace, Craigslist, Direct Booking Pro, and/or their own websites can undercut Airbnb prices by 25%+ and still make the same amount.



What is direct booking?

Direct booking is the process by which hosts process bookings for rental properties within their own website, rather than through an online housing marketplace platform (e.g. Airbnb, VRBO).


Direct booking allows potential guests to see and book your spaces on your own website.


No direct booking website yet? No problem. Easily create a direct booking site with no tech experience


Earlier this year, Kopa introduced a new product, Direct Booking Pro, in addition to their mid-term rental marketplace. Through this new product, property managers and owners generate their own custom website, which they can take all their leads to for 0% service fees.



What does Kopa's "all-in-one" direct booking platform do?

  • Create your own SEO- and mobile-friendly website. In a few clicks, you can make a professional website that converts your guest inquiries to completed bookings. Oh, and it's beautiful especially on a phone, which over 50% of guests use.

  • Communicate with guests. Kopa's inbox allows you to respond to renters via your direct booking platform or by responding directly to the email or SMS/text message notifications.

  • Guest and booking management. You'll have your own reservation dashboard where you can manage all your inquiries, bookings, and payments.

  • Process all payments. All payments are free for hosts and secure. Kopa allows renters to pay with a U.S. bank account for free, or they can pay with a credit card for the usual 2.9% processing fee (paid by the guest).

What are the main benefits to trying Kopa?


#1. No tech skills needed and super simple setup

Setting up your new website takes just a few minutes. No technology or coding skills are needed. Kopa allows you to import listings. Completing your website involves filling out a few text fields and uploading photos.

#2 Make more money

Let's say you have a space that costs $100/night, and it's booked 60% of the year. At a nightly rate, that comes out to $21,900 in potential earnings. If you compare the cost of Airbnb at 15% to a direct booking pro plan, you'd save $3,000 per listing per year. Plus, because the Direct Booking Pro plan is a monthly or yearly subscription, you'll always know how much you'll pay.


This chart compares the cost to hosts and renters for 1 and 5 listings, using Airbnb, VRBO, and Kopa's Direct Booking Pro.


#3. Build a brand for your rental properties

It's hard to be a standout rental property manager when there is so much competition. Having your own well designed website reduces that competition since there aren't links to other listings (e.g. "Other places in San Francisco").


Your website can be the central place for potential guests to learn everything about your properties — from knowing where they're located, when they're available, reviews about them — and be able to book them seamlessly, too.


#4. Access to Kopa's Mid-term renters with Zero Service Fees


As a bonus, if you sign up for Direct Booking Pro, your property will be featured on their general search engine. The service fees they typically charge will be waived for you.


What type of host or property manager is it good for?

Kopa supports hosts who do any type of stay — short, medium, and long-term rentals. Hosts with anywhere from 1-250+ properties have used the Direct Booking Pro to create their own website.


The plan is best for property managers and owners who post on lots of platforms and want to take all of their leads to one place to avoid any service fees. Hosts have done this by including a link to their custom website wherever they post their property.


In addition, your listing will also be shown to potential Kopa renters for free! As the mid-term rental market takes off, being an early adopter to Kopa will be like signing up for Airbnb in 2009. You will get early adopter advantage in the form of ratings and reputation! I own one property that have decided to post my own property on Kopa Direct Booking Pro for this very reason.

So how can you get started?


You can head to Kopa Direct Booking Pro to start a free trial, which gives you plenty of time to set up your listings, build your website, and start sharing it.

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