How to Build a Thriving Midterm Rental Business

If you’ve been around real estate investing long enough, you’ve probably heard about the rise of midterm rentals. These rental properties sit neatly between short-term vacation stays and traditional long-term leases. Yet many investors are only beginning to scratch the surface of their potential. On a recent episode of the Tax Smart REI Podcast, we sat down with Jesse Vasquez, founder of AirVenture Academy, to unpack his journey into midterm rentals and why he believes this is one of the biggest real estate opportunities today.

The Accidental Investor: Jesse Vasquez’s Story

Jesse’s story isn’t your typical real estate investor narrative. In fact, he didn’t even plan on becoming a real estate investor. For nearly two decades, Jesse worked in healthcare sales, traveling between hospitals as a business development manager. But in 2015, he stumbled onto an opportunity that changed everything.

During his daily hospital visits, Jesse noticed a common theme: hospitals across California were filled with travel nurses who had nowhere decent to stay. One conversation with a travel nurse named Barbara was a turning point. She told him she was working 12-hour shifts but staying in a rundown Motel 6 in Modesto, California, because there simply weren’t any better options.

That conversation sparked Jesse’s first deal. Without prior real estate experience, he approached the hospital’s HR department with an offer: quality, furnished housing for their travel nurses. The hospital signed a two-year contract with Jesse, guaranteeing $5,000 per month, whether the nurses stayed there or not. At the time, long-term rents in the area hovered around $1,800. He was immediately making more than double what most landlords could expect from a long-term tenant, without any of the typical headaches.

Learning from the Mistakes of His Parents

Jesse’s pivot into midterm rentals wasn’t just about spotting an opportunity; it was also about avoiding the pitfalls he had witnessed growing up. His parents had invested in long-term rentals but often ended up stuck with tenants who didn’t pay. He recalled sitting in a courthouse as a child, overhearing a judge describe how a tenant had gamed the system to live rent-free in their property for months.

That experience made a lasting impression. Jesse knew he didn’t want to go down that road. Midterm rentals offered something different: higher-quality tenants, contracts with reliable companies, and significantly reduced risk.

Midterm Rentals vs. Short-Term and Long-Term Rentals

Jesse breaks down the financial comparison between rental types using his local market in Modesto as an example. A standard 3-bedroom, 2-bath long-term rental might bring in $2,300 to $2,500 per month. A short-term rental could earn $6,000 to $7,500 during peak season, but those numbers are often diminished by frequent turnover, high cleaning fees, and Airbnb platform charges.

On the other hand, Jesse’s midterm rentals consistently bring in $6,500 per month with minimal turnover and operating costs. There’s no need to replenish consumables constantly or deal with frequent cleanings. The result? Steady, reliable income with less day-to-day hassle.

Who Rents Midterm Properties?

While Jesse initially focused on travel nurses, his midterm rental client base has expanded significantly. Today, his properties host a variety of tenants, including:

• Insurance relocation clients (often the highest-paying)
• Corporate travelers
• Construction crews
• Physical therapists and occupational therapists
• Engineers on assignment

One of Jesse’s best strategies is simply asking the right questions during booking inquiries. By doing so, he uncovers opportunities for long-term, high-value tenants who may otherwise have slipped through the cracks.

How to Secure Contracts with Companies

One of Jesse’s biggest insights is that the real money in midterm rentals comes from business-to-business (B2B) relationships, not just individual travelers. Early on, he realized the power of connecting directly with companies that consistently needed housing for their employees.

Jesse’s strategy is simple but highly effective. He drives by extended-stay hotels, notes the work trucks in the parking lot, and contacts those companies directly. By offering them housing that’s both cheaper and more comfortable than a hotel stay, he’s able to secure long-term contracts.

In one example, a company was spending $20,000 per month to house seven workers in hotel rooms. Jesse offered them a fully furnished house for half the cost, saving them $50,000 over five months and securing a $10,000-per-month lease in the process.

Midterm Rentals Are Still an Untapped Opportunity

According to Jesse, midterm rentals are still in their early days. He compares the current state of the MTR market to the early innings of a baseball game, while short-term rentals (STRs) are already deep into the seventh-inning stretch. Big institutional players like Blackstone and BlackRock are investing heavily in the midterm rental space by acquiring extended stay hotels. Jesse sees this as a clear sign that midterm rentals are on the rise. In his view, midterm rentals will soon be recognized as their own asset class, just like single-family and short-term vacation rentals.

Navigating Regulations: Less Red Tape, More Freedom

One of the biggest advantages of midterm rentals is avoiding the red tape that often comes with short-term rentals. Many cities heavily regulate STRs, but MTRs—defined as stays of 30 days or longer—face minimal restrictions in most areas. The one exception is Hawaii’s Big Island, which requires leases of at least 180 days. Outside of that, most markets are midterm rental friendly. Jesse points out another advantage: working with companies and professionals on assignment reduces the risk of squatters. These tenants typically have no interest in overstaying, they just need a place to live while they’re on assignment.

Midterm Rentals and Taxes: What You Should Know

For investors, midterm rentals often fall under the Real Estate Professional Status (REPS) rules, opening the door to powerful tax benefits. Whether you qualify for the STR tax strategy or REPS will depend on how you structure your rental business and how many hours you actively participate in the management of your rentals.

What Types of Properties Work Best for Midterm Rentals?

Jesse prefers 3-bedroom, 2-bath homes because they appeal to a broad range of tenants, from families in insurance relocation situations to traveling work crews. However, he emphasizes the importance of knowing your market. In some cities, one-bedroom units or studios may make more sense. He recommends talking to your local economic development offices to learn about upcoming projects. New Walmarts, Dave & Buster’s, or large construction projects can bring in traveling workers who need midterm housing.

How Jesse Helps Investors Get Started

For investors ready to jump in, Jesse offers tons of free content on his YouTube channel. For those wanting more structured, hands-on help, he runs AirVenture Academy, where he teaches investors how to:

• Find the right properties
• Connect with companies and build B2B relationships
• Pitch contracts effectively
• Scale their midterm rental businesses for long-term success

Jesse’s system isn’t rocket science, but it does take grit, persistence, and the willingness to pick up the phone and face rejection. The payoff, though, can be massive.

Relationships Are the New Currency

Jesse sums it up perfectly:
“Most investors chase the dollar. They should be chasing relationships.”

In midterm rentals, relationships are everything. By focusing on building trust with companies and serving tenants in meaningful ways, investors can create sustainable, long-term income streams.
As midterm rentals continue to gain traction, now may be the best time to explore this strategy for your portfolio. Whether you’re looking to diversify, improve cash flow, or avoid the volatility of short-term rentals, Jesse’s approach offers a proven path forward.

Curious about the tax benefits of midterm rentals? Reach out to our team today.

Transcript

Introduction

Thomas Castelli, CPA (00:00)
Hey everyone, thanks for tuning into this week’s episode of the TaxSmart REI podcast. Today we’re joined by Jesse Vasquez, founder of AirVenture Academy. He teaches entrepreneurs how to build profitable midterm rental businesses. We’ve talked a lot about short-term rentals and long-term rentals on the show, and we frequently get questions about midterm rentals, but we’ve never had a guest on to talk about it. So, today, we’re diving into everything midterm rentals with Jesse. We’ll get into all of that in just one minute.

Jesse’s Background & Accidental Start in Real Estate

Thomas Castelli, CPA (00:40)
Jesse, thanks again for joining us today. Would you be able to give our listeners a brief overview of your background and how you got involved in the real estate space?

Jesse Vasquez (00:41)
Yeah, what’s up guys? Thanks for having me here, super excited! I started back in 2015, on accident actually. I worked in healthcare for 17 years as a business development manager, basically a sales rep for hospitals and home health companies. I noticed a recurring theme of travel nurses needing housing, which got me thinking. Despite my parents’ rough experience as landlords, I saw an opportunity.
I met a travel nurse named Barbara at a hospital in Modesto, who was staying at a seedy Motel 6 because there was no other housing available. After talking to her and some folks in HR, I realized there was a huge demand for better housing options. I ended up securing a contract with a hospital to house their travel nurses at a much higher rate than traditional rent. That moment changed everything for me.

The “Accidental Landlord” Story

Justin Shore (04:48)
That’s one of the best accidental landlord stories that I’ve heard. It all started with taking initiative, asking questions, and realizing there was a huge demand.

Transition from Long-Term to Midterm & Short-Term Rentals

Thomas Castelli, CPA (05:06)
So before this, it sounds like you weren’t interested in long-term rentals. Have you ever considered short-term rentals, or was this midterm opportunity your path forward?

Jesse Vasquez (05:21)
I actually own short-term rentals as well. But growing up, I saw my parents struggle with long-term tenants. That made me hesitant.
Now, I see a new wave of modern investors attaching businesses to their real estate. It’s no longer just long-term rentals managed by property managers. Investors are doing midterm, short-term, co-living, and residential care. It’s a different mindset today.

Profitability: Midterm vs. Short-Term vs. Long-Term

Thomas Castelli, CPA (08:27)
When it comes to midterm rental strategy, how do the profits compare to long-term and short-term rentals?

Jesse Vasquez (08:47)
It’s massive. In my market (Central Valley, CA), a 3/2 long-term rental might rent for $2,300–$2,500.
Short-term rentals during peak season can hit $6,000–$7,500, but turnover and cleaning fees eat into profits.

With midterm rentals, I get $6,500 consistently, with fewer expenses and turnover.
Also, it’s risky buying properties that only work as STRs without fallback strategies like MTR or LTR.

Tenant Types for Midterm Rentals

Thomas Castelli, CPA (10:43)
You mentioned travel nurses as tenants, any other tenant types for midterm rentals?

Jesse Vasquez (10:58)
Yes, beyond travel nurses:

• Insurance relocation clients (highest-paying)
• Business travelers
• Construction workersCorporate workers on assignment

Asking the right questions during booking inquiries can unlock these opportunities.

Getting Contracts with Companies

Justin Shore (13:26)
How do you get contracts with companies? Did you start with individuals first?

Jesse Vasquez (13:49)
I found a different approach.
Extended Stay hotels (owned by Blackstone) are midterm competitors. I drive by, take photos of work trucks, and contact those companies directly.
I explain how I can save them money with furnished housing. One company was spending $20K/month at Holiday Inn Express, I got them into one of my properties for $10K/month.
It’s about serving them, saving them money, and making their logistics easier.

Referral Network & Community Collaboration

Jesse Vasquez (16:38)
The goal is to serve as many companies as possible.
I collaborate with other investors, referring tenants when I’m fully booked.

If I get 10% of a $6K–$10K monthly rent for a referral, that’s a win for everyone.
This business model thrives on relationships, not competition.

Regulations: Midterm vs. Short-Term

Justin Shore (19:38)
What are the regulatory differences between STR and MTR? Is MTR less restrictive?

Jesse Vasquez (20:12)
Absolutely.
STRs are highly regulated. MTRs (30+ day stays) are often exempt.

For example, in California, you can bypass STR rules by renting midterm. Only Hawaii (Big Island) has a 180-day minimum for MTRs.
I’ve never had squatters because I rent to companies, not individuals, and lease language is framed around “guests,” not “tenants.”

Platforms for Midterm Rental Listings

Justin Shore (24:30)
What platforms are best for MTRs?

Jesse Vasquez (25:00)

• Airbnb
• VRBO
• Furnished Finder
• CHBO (Corporate Housing by Owner)
• Booking.com (less ideal, but sometimes works)
• Also, direct referrals and contracts are key. I emphasize relationship-building with insurance companies and corporations.

Insurance Relocation Clients: Huge Opportunity

Jesse Vasquez (26:53)
Insurance relocation is huge. Every 88 seconds, someone files a claim.
I’ve rented properties for $7,500/month through companies like ALE Solutions.
These contracts often extend and pay top dollar.
You don’t need to own the home—just be the solution provider for these companies.

Serving the Community Through Midterm Rentals

Jesse Vasquez (29:46)
This business serves the community.
I once helped a family displaced by a flood who just wanted to eat dinner together again.
That moment shifted my mindset from chasing money to serving people.

Regulatory Outlook for MTR

Justin Shore (32:06)
There’s stigma around landlords, but providing housing in emergencies is a net positive.

Tax Implications & Time Commitment

Thomas Castelli, CPA (33:30)
Midterm rentals typically fall under real estate professional status (REP).
Jesse, how much time do you spend operating your MTRs?

Jesse Vasquez (34:13)
I qualify as REP through active management and lead generation.

Property Types & Ideal Investments

Thomas Castelli, CPA (38:44)
What property types work best for MTRs?

Jesse Vasquez (39:01)
3/2 homes are ideal—they’re the average American home.
But it depends on your market.

Understand local demand, like one-bedrooms in some areas or larger homes for crews in others.
Look for development projects (Walmarts, Dave & Buster’s) that bring in traveling workers.

Market Outlook for Midterm Rentals

Thomas Castelli, CPA (42:34)
Where’s the MTR market heading? Oversaturation? Headwinds?

Jesse Vasquez (42:55)
MTR is early in its game.
STR is in the 7th inning.
MTR is just starting—companies like Blackstone investing in extended-stay hotels prove it.
MTR will become its own asset class in the next 5 years.

How Jesse Helps Others Get Started

Thomas Castelli, CPA (44:28)
How do you help people get into MTRs?

Jesse Vasquez (44:40)
I offer a free YouTube channel (search Jesse Vasquez) with tons of content.

For hands-on help, I teach people how to:

• Find the right properties
• Pitch to companies
• Structure deals
• Build a lead generation machine
• Systematize their businesses

It’s about grit, tenacity, and building relationships.

Wrap-Up

Thomas Castelli, CPA (45:54)
Jesse, thank you for coming on the show today!
The biggest unlock was learning how to reach out to companies directly and build those relationships.

Thanks again!

Jesse Vasquez (46:17)
Thank you, guys! Appreciate it.

Disclaimer: This podcast summary and transcript were partly generated and may contain some errors or miss key points from the audio recording.