What is one thing that most midterm rental hosts overlook every year that costs them lots and lots of money?

It’s not bad pricing. It’s not bad. Guess it’s calendar gaps. If you’re hosting a midterm rental with a 30 night minimum, well then you know the pain of having a long gap in your calendar. Unlike short-term rentals where you can fill those big gaps with weekdays or weekend reservations, or maybe even a one nighter.

You can’t do that if you have a midterm nightly restriction. So in this episode, we’re diving into why these big gaps are happening in the first place, what you can do to prevent them and in turn, increase your profitability with your midterm rental so that it’s not making less than what a long-term rental would potentially make.

Stay tuned. Let’s jump into all the details.

There are a lot of you out there that are operating midterm rentals. Maybe you do it part of the year when seasonality is lower, or maybe you’re doing it because of regulations in the city, or maybe you’re doing it because you like the idea of having less operations, but the common thread amongst all of you is that you wanna earn more money with that property then you would as a long-term rental.

And we know that we can, A successful midterm rental can earn as much as 20% or even twice as much or more of what a long-term rental would earn, but not if things aren’t set up right.

And the biggest culprit to having lower performance with a midterm rental versus a long-term rental is making sure that your calendar stays occupied and you don’t have big, long gaps.

Why do these calendar gaps make such a big impact on your midterm rental? Well, because you really only have maybe six to 12 maximum guests that are staying with you throughout the course of the year,

and if between each of those guests you have a gap here or two weeks there that you can’t rent because you can’t fill it with a short-term rental, then that’s a massive impact on your overall profitability.

Once that gap is created, you can’t legally do anything to occupy the space, but your expenses, of course, are gonna keep on running.

 so why do these big gaps happen with midterm rentals? Well, it’s really quite simple. It all comes down to the way you have your calendar set up.

Airbnb and all these listing platforms wants you to have your calendar open as far out as possible a year or more. And we know that they actually give you a little more visibility if you do that, but you can’t do that as a midterm rental host, and I know that might sound counterintuitive because a lot of times guests that are staying for a longer period of time book further in advance in the future, If you just leave your calendar open, then it creates a potential for some really big gaps.

So how do we fix this? Let’s just jump into it step by step. The first step is you need to have a dynamic pricing tool.

We use Price Labs, but you can also use Wheelhouse or Beyond pricing. There’s quite a few of them out there. That is step number one. Step number two is that you need to set up what they call an adjacent night availability factor. Now, I don’t wanna lose you on this one.

This can get a little bit more complicated. For those of you catching the audio only version, know that you can come back and check out our YouTube channel. We’ll have some graphics and things to help explain this a little bit more.

So what does this adjacent reservation availability setting do? Well, it allows us to limit our calendar availability based on an existing reservation . So let’s say someone booked for the next three months.

And instead of leaving your calendar open for the whole rest of the year, for the next 365 days, your calendar’s actually only open for that adjacent period, which you set after that guest checks out.

So let’s say they check out on July 1st and you have 10 days available adjacent to that reservation. That means that someone could book again, a minimum of 30 nights. But only within that period of July, first to July 11th. 

So hopefully that makes sense. You have a minimum night setting. We’re calling that 30 days. Maybe it’s because of regulation, so no one can book less than 30 days.

But you don’t want the big gaps, so what you do is you limit all your calendar availability so that someone can only book within the next 15 days or 10 days, or whatever you set after the existing reservation. Now, of course, this doesn’t mean that someone’s going to book within that five, 10, or 15 days after the reservation, but it does prevent someone from booking 29 days afterwards and creating that really large gap.

So the length of this adjacent availability gap that you’re setting up, whether it’s 5, 10, 15, 20 days. That’s going to be based on the demand in your local market. So if you’re in a place where your midterm rentals always staying booked up, you can make that gap much shorter, right? But if you’re in a place where maybe it’s very seasonal and you just don’t have a lot of bookings coming in, then you’re gonna have to increase that gap to open your calendar up for more potential bookings.

Just another quick note on this or another way of explaining this, I know this gets a little complicated, but let’s say you’ve got this guest staying in your midterm rental and they check out five months from now. Other midterm rental guests are usually looking further out in the future, and

they’ve got plenty of time to book your property further out in the future. So you’re not eliminating it in that way,

So I know this is a little complicated for those of you catching the YouTube version. Well, you can see the screenshot right here. You can see that I’ve got a gap set up for 15 nights, but I also have a second gap set up, and now this gets another level of complexity.

But basically the way my calendar’s currently set up, it says, okay, adjacent to any reservation, someone can book within that next 15 days for a minimum of 30 nights. But if someone’s booking at least 60 days, then they have a 45 day gap. To make a 60 day booking, which means yes, I could get a larger gap in my calendar, but I would prefer to have guests saying for a longer period of time than a bunch of one month guests.

So again, this is a little complicated. Hopefully this screenshot helps you break it down. And if you’re using Price Labs, you can just copy the settings that I have set up in here.

let’s break this down with just a real quick math exercise. Let’s say that your midterm rental is running for $3,000 a month, but over the course of the year, you have a gap here, you have two weeks there. Hopefully you don’t have any of the big ones, 28, 29 days. But let’s say that three months out of the year, you’re not able to rent that property.

So you ultimately end up making $27,000. Not too bad, right? But what if your long-term rental. Could have rented for $2,000 a month, that would be $24,000. You also would not be paying utilities. You also wouldn’t have the furniture costs. And in this situation, you really are losing as a midterm rental host.

So we gotta make sure we get these adjacent availability factors set up with your dynamic pricing tool. It’ll help eliminate these big gaps.

Of course you can’t stop there. You need to be proactive with your property. You need to be monitoring demand and your booking windows Because it could be that even with these adjacent calendar settings set up, it doesn’t make sense for you to rent as a midterm rental if all this stuff just sounds way too complicated and you have some midterm rentals out there and you would like some help with them.

Well, our team has helped manage thousands and thousands of guests, lots of midterm guests, and we’d love to partner with you. You can find out more. Just go into st r riches.com. There’s a little partner with us button there.

So keep track of your listings performance. Keep track of those gaps in your calendar, and if you’re using this approach and you find that people are booking within one week, then don’t give them two weeks to book, right? We need to constantly be moderating this to help cut down on these vacancies. You have to treat this as a business.

It’s not as passive as a long-term rental would be.

If you’re new to the show, we’ll have a lot of topics talking about all things short-term rentals and midterm rentals. You can go back to episode 2 11, 2 12 and two 17, where we uncover all the things you should be doing as a midterm rental host.

We’ve got checklists in there, all kinds of things from taking payments to where you’re advertising to help you get more visibility and have a better performing property.

Remember, you’ve put a lot of time into furnishing your midterm rental, and if it’s potentially doing worse than a long-term rental, then what’s the point? The culprit is going to be these calendar gaps, and so I hope that these tips help you shorten those gaps and make more money. Until next time, I hope you have a fabulous week.