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Show Summary
In this episode, Jeff Hurst shares insights into the growing midterm rental market and how investors can benefit from this niche strategy. As the CEO of Furnished Finder, Jeff explains how the platform connects property owners with traveling professionals seeking stays that average around three months. He also discusses platform features, regulatory considerations, and opportunities for investors looking to generate consistent rental income through midterm rentals.
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Investor Fuel Show Transcript:
Jeff Hurst (00:00)
I think when you look for Airbnb and VRBO, it’s definitely price. And so if you think about our core customer, you know, let’s say you’re a traveling nurse that’s making $100,000 a year and you’re going to travel 10 months out of the year. And the difference between 10 months at, for round numbers, $2,000 a month on your stipend and paying for Airbnb at $200 every month traveler fee.versus keeping that $200 and maybe paying $1,800 a month on Furnished Finder, that adds up to be about two weeks of take-on pay. And so it’s a really big deal.
Michelle Kesil (02:06)
Hey everybody, welcome to the Real Estate Pros podcast. I’m your host, Michelle Kesil Today I’m joined by someone I’m looking forward to chatting with, Jeff Hurst, who is the CEO of Furnished Finder. So excited to have you here today, Jeff.Jeff Hurst (02:23)
Pleasure to be here. Thanks for inviting me.Michelle Kesil (02:25)
Absolutely, I think our guests are really going to take something away from how you’re approaching the midterm rental space. So let’s dive in. First off, for those who are not yet familiar with you and your work, can you share what your main focus is?Jeff Hurst (02:44)
Yeah, and so individually, I’m Jeff Hurst. I’ve been the CEO of Furnished Finder for about two years. Before that, I was the president of VRBO or also known as VRBO, and then I was the chief operating officer at Expedia Group. And so I was in the short-term rental industry for 2010 to 2023, and I actually owned three short-term rentals, ⁓ one on a lake outside of Austin. I have a ranch and then I have a beach house in South Padre.And so I’ve been a real estate investor for a long time and also spent a long time in short-term rentals. When I left Expedia, ⁓ I met the founders of Furnished Finder and they hired me to come in and be the CEO and bring in a new management team. And so they stayed on the board of directors. Furnished Finder has been around for over 10 years. We became big in COVID serving traveling nurses and helping people manage the pandemic.
And since then, we’ve been really focused on improving the technology and expanding the tenant groups so that more and more people can find, you know, basically affordable housing to manage their careers and their lifestyles. And we’re two years into that journey since I’ve joined. We now serve almost a quarter of a million landlords and have the most monthly furnished rentals in the U.S. with over 310,000.
Michelle Kesil (03:59)
Awesome. And so when you say like midterm rentals, is there an approximate amount of time that most people are booking with you guys?Jeff Hurst (04:13)
Yeah, so the primary part of the definition is what’s the minimum. And so it’s a minimum of a month. know, some people define a month as 28 days or 30 days. We don’t kind of get into the nitpicking in there, but it’s a minimum of one month. And the reason for that is that it’s usually when you start to establish lease dynamics, but also so many jurisdictions have ⁓ short-term rental prohibitions, licensing or regulations that we want to operate outside of that constraint.that’s affecting so many different jurisdictions. So it’s at least a month. What we see on average is that the average stay is almost 100 days. And so people are staying over three months and then a third of the people that are staying actually end up extending also. And so when you think about our use cases, a third of our tenants are traveling for work and that could be skilled trade like electricians building a data center or it could be construction workers with a high rise. 25 % is healthcare.
And so they’re typically traveling on 10 to 12 week contracts as nurses. And then 20 % is relocating families. And that’s where you see probably the most extensions because they may have had a plumbing leak or a roof catch on fire or they’re remodeling or building a new home. And so they could end up facing extensions quite a bit. And so those are the use cases. And, ⁓ you know, I think that the distinctive factor here is that when you’re doing this, you’re typically earning maybe 50 % more than a long-term lease, but
you’re turning it over three to four times a year in addition. And so it’s a lot more extra yield for not that much extra work.
Michelle Kesil (06:35)
Yeah, absolutely. And I think since the pandemic, there’s also been the rise of like digital nomads and people wanting to explore different places for, you know, a certain amount of time that isn’t always accessible with the lease or Airbnb prices. ⁓Jeff Hurst (06:50)
Yeah,yeah, totally. mean, when you go beyond those top three use cases, academic, so grad students and professors are 10%, digital nomads is about 5%. What we find with digital nomads is they kind of identify themselves different ways. And so I think they show up in more than one group in the way that we’re asking the question from a data perspective. know, one of the use cases that I think has been very interesting is that it’s actually a much older tenant demographic than I expected having come from VRBO and
Michelle Kesil (07:06)
YeahJeff Hurst (07:19)
competed with Airbnb. It’s very frequently retirees or even grandparents who are getting a place for the first four months of their grandchild being born. They don’t want to like be a burden in the spare bedroom or put someone out of their bedroom. And so they, you know, rent a one bedroom duplex nearby and then they have all the ability to be close and be of assistance, but also for the baby to come stay with them and maybe give the new parents some space.Michelle Kesil (07:46)
Yeah, there’s so many uses. That’s awesome. And so on the investor side, what does that look like? Like what criteria do they need in order to get their listing published?Jeff Hurst (08:01)
Yeah, so publishing a listing feels very much like any other website. know, the only distance difference being that we’re a subscription model. And so we’re $199 a year, but in exchange for that, you get to collect money however you want. get to set your own pricing terms and we don’t charge any commissions or booking fees. And so over the course of a year, it’s a lot cheaper than paying a 15 % commission to booking.com or 10 to 15 % traveler fees to Airbnb.You know, what I’d emphasize for investors is that it is, it has more in common with long-term than it does short-term in terms of like the dynamics of the inventory. And I think that’s really good for first-time investors for a handful of reasons. ⁓ 70 % of our inventory is two-bedroom or smaller. So it’s a smaller footprint, which means it’s typically more affordable. We’re not a leisure business at all. We’re around like commuter corridors, hospitals, and good schools. And so that’s another place where like you can potentially get into a duplex or a quadplex.
live in one of the units, rent out the other, and start to have some house hacking scale and some real advantages there. And then the last reason is because we’re not leisure destinations, you can also self manage these much easier. And so you’ve got the opportunity to potentially buy one within 10 minutes of your primary residence, and then do the management work yourself so you have sweat equity and aren’t paying 10 to 15 % management fees to somebody else. So I think it’s a really great, probably a better entry point than short term rentals.
because of those dynamics and it’s typically a better cash on cash return. But you do sacrifice some of the vanity usage of like maybe you do want to take your kids to your lake house and have that be subsidized. And so it’s different, but I think from a pure cash perspective, it’s really exciting.
Michelle Kesil (09:39)
Yeah, amazing. And so the way that the platform works, is it primarily just for booking or does it cover things like security and background checks and deposits and all those other things that the people that upload warehouses have to manage?Jeff Hurst (10:28)
Yeah, so for $200, we publish your listing for a year and that gives you access to messaging, calendar, and then all of the different tools that are typically paid for by the tenant. And so we recommend you use our tenant screening product, which is powered by TransUnion. You know, the tenant, I think it pays $39 for a screening and they can use it multiple times or for multiple visits. We have a partnership with RocketLogger so you can create your own custom lease and have your own pet amendments or what’s your extension agreement look like.Be sure you’ve got the right term for how much notice they’re required to give you so you can minimize your vacancy. We’re relaunching a product that’s a deposit waiver. And so that should be live probably in early May. And that helps tenants have peace of mind without the obstacles of maybe having a thousand or $2,000 deposit for your rental by just paying a monthly waiver fee every month. And then it helps the landlords because they don’t have to hassle the tenant for
you know, if there is a stain on the carpet or whatever it may be, they can get that type of stuff cleaned as long as it meets the dynamics of the policy. And so those are the big ones that we offer. We do have a partnership with Baseline that we just launched, which helps people with bookkeeping and rent collection. And so we try to make it as seamless as possible. just, you know, upload your content, upload your photos, and then you use our help tutorials and video content to really be sure you know you’re in a good position to manage that first tenant lead you get.
and help be sure you’re protected and they have a good rental experience.
Michelle Kesil (12:00)
Awesome. And what would you say is like the biggest differentiator of Furnished Finder versus the others, you know, Airbnb, VRBO and all those?Jeff Hurst (12:10)
Yeah,I think when you look for Airbnb and VRBO, it’s definitely price. And so if you think about our core customer, you know, let’s say you’re a traveling nurse that’s making $100,000 a year and you’re going to travel 10 months out of the year. And the difference between 10 months at, for round numbers, $2,000 a month on your stipend and paying for Airbnb at $200 every month traveler fee.
versus keeping that $200 and maybe paying $1,800 a month on Furnished Finder, that adds up to be about two weeks of take-on pay. And so it’s a really big deal.
You’re paying for a vacation. You’re doing something meaningful to advance your life and your livelihood just by not booking on Airbnb. And so they’re willing to do a little bit of extra work to avoid those service fees. And that’s really the most distinctive thing. I think from a landlord perspective, what’s distinctive is that we do publish a phone number.
and you can just talk to people. And frequently, because these are 90, 100, 120 day stays, a lot of times the tenant will want to come see the house or do a video walkthrough. And so there’s a lot of things that just aren’t supported by the direct booking model you see on Airbnb that we think are big benefits for landlords who want to have more control, direct communication in a lower cost platform.
Michelle Kesil (13:24)
Yeah, absolutely. think those little things can make a big difference in how safe and comfortable someone feels.Awesome. And so as a ⁓ landlord or investor, what are maybe some of the ways that they can expand their reach through this platform, if that makes sense? Are there certain tools they can to get more visible or seen?
Jeff Hurst (13:57)
think that there’s not, we don’t have anything that’s like an additional pay for play type of feature. What we do encourage people to do when you’re investing is really invest in what you know and get to know who’s traveling to your neighborhood. And so, you know, the tips I’d have on that topic are that, you know, if you are near a hospital and think you’re going to be catering to travel medical, you know, be sure you’ve got good blackout shades. You know, a lot of them work night shifts. Be sure you’ve thought through some of the unique dynamics for different use cases. It’s not particularly one size fit all.And so if you’ve got a two bedroom, think about whether your core audience is going to be a traveling couple who wants a spare office. So the second bedroom has more of a desk dynamic or whether it’s a misplaced family and that displaced family might need bunk beds in the second room because they may have two kids and they’re trying to, you know, manage a buy sell situation for their home or maybe their insurance displacement. We power a tool on our site called Market Insights. It’s on the top left of our navigation bar.
And if you type in any city in the US, it’ll tell you what the traveler profiles are that are going there that can help inform, you know, who you should be targeting and what that looks like. And, know, the other thing that’s a little bit of a more of an old school hack is, you know, drive by the closest extended say America, see what types of logos are on the trucks and see who’s staying there and talk to people to get a better feel for like, who are the, you know, traveling professional class that’s in my neighborhood.
and how does my place stack up versus a more traditional option like an extended stay hotel.
Michelle Kesil (16:07)
Yeah. And are there certain locations that you don’t serve or that you see the majority of your investors coming from?Jeff Hurst (16:19)
We are everywhere. so with 300, I think as of a few days ago, 14,000 properties across the U.S., we’re everywhere. What we’re known for is more suburban commuter corridor, hospital, university. And so like, not going to be, you know, we’re not great at Aspen, we’re not great at 30 a.m. Florida, we’re not great at your top leisure destinations. And similarly, we tend to be a smaller footprint.you know, we’re more two bedroom and smaller in terms of where we are most successful. ⁓ And so what I’d encourage people to do is really think about what is that local hotel and Airbnb dynamic? And what do you have to add to it? If you were to put a duplex or something in there, do you feel like there’s an interesting niche you can feel, ⁓ Most of where we’re seeing growth is often in these either smaller towns or it’s in places that have really strict anti short-term rental laws.
And those are increasingly common where it’s just illegal to rent for less than 30 days or, you know, there’s a certain number of turnovers you can have a year or there’s a minimum night of seven days. Those are all places where potentially an investor was planning to be short-term and doesn’t realize furnish finders available to help them in a new regulatory construct.
Michelle Kesil (17:33)
Yeah, absolutely. does Furnished Finder, is it able to, yeah, like mitigate those laws in all areas or are there certain areas where it still kind of falls under the short term rental? ⁓ huh.Jeff Hurst (17:44)
It’s.It’s very rare. ⁓ There
are certainly homeowners associations who will have ⁓ restrictions against 30 days and more or less than 365 days. ⁓ At the state level, the only one I’m aware of is Hawaii. ⁓ That I think there are islands in Hawaii that might be 90 days, but I’m pretty sure that’s under review. But for the most part, it’s been written as 28 days in most cities.
Michelle Kesil (17:52)
Right?Yeah.
Awesome. And so if someone just wants to join as an investor landlord, they get to just sign up on your website and do the subscription or is there anything that they need to do?
Jeff Hurst (18:24)
Exactly. Yeah, all you need is awell, I mean, you need to have a property that you can legally rent. need $200 for the annual subscription and you need a ⁓ ID so we can verify your identity and that you’re associated and help establish trust. We’re adding features to do more of that for tenants. And then we obviously have the TransUnion products and things like that to help keep the marketplace secure. But my my encouragement to people is the ⁓
Michelle Kesil (18:32)
Right?Awesome.
Jeff Hurst (18:54)
You know, one of the things you can do if you’ve got an unfurnished ⁓ residence that you want to try, you can actually put the pictures up on our site unfurnished and tell the tenant that you’ll furnish it when they sign the lease. And that can be really appealing to a tenant because then they kind of know like whether they’re the desk person in the second bedroom or the bunk bed person that they’re going to have exactly what they’re looking for. And it does de-risk a little bit the most common complaint I hear, which is like, well, I don’t want to buy furniture if I don’t know if it’s going to pay back.And so you can get started that way if you don’t already have a furnished accommodation.
Michelle Kesil (19:24)
Hmm.Yeah, that’s a good hack. Are there any other features that you’re working on solving or things that you’re looking to add and scale to next?
Jeff Hurst (19:39)
Yeah, for those of you who are ⁓ larger scale managers, and so potentially you’re using a short term software like Keste or HostAway or Hostfully, or maybe you’re using one of the long term software players like RentReady or TurboTenant, the big initiative we’re working on now is how do we make it easier to connect to those platforms. And so we’re working with each of them now. We don’t have any definitive timeline for when different ones will be available.But that’s probably the biggest thing we’re working on now to make it easier to be supported on our side is to build API connectivity so you can just click and publish like you might be used to on other platforms.
Michelle Kesil (20:19)
Yeah, and is this something that you’re maybe thinking to scale international or it’s gonna be just US based?Jeff Hurst (20:26)
For the foreseeable future, it’ll just be US based. ⁓ The complexity of going abroad is pretty material. think we would, when we go abroad, we’ll start with Canada and kind of prove the use case and get a better feel for it. And then we’ll see where we are.Michelle Kesil (20:43)
Awesome. And are there any sort of like legal issues that you often like see people run into when it comes to like that landlord tenant thing that you guys support people with?Jeff Hurst (20:59)
I ⁓don’t think there’s anything unique to being a monthly rental that you wouldn’t see in a long-term rental. It’s overwhelmingly the exact same process. ⁓ If anything, think maybe because there’s tighter turns and it’s typically someone’s basically, it’s where they’re sleeping for their job, ⁓ I think you’re a little less likely to have problem evictions than you might be in long-term.
Michelle Kesil (21:04)
Right?Jeff Hurst (21:27)
because people’s circumstances don’t change as much in three months as they might in three years. But in general, I think if you’re comfortable doing long-term renting, it’s the same process. If you’ve been doing short-term renting, the big difference is that you’re not just relying on Airbnb’s booking process and their guarantees. You’re doing a little bit more of the legwork on your own, but in exchange for that, you’re also getting more control and no commission.Michelle Kesil (21:51)
Yeah, absolutely. That makes sense. Thank you for sharing all of that.Jeff Hurst (21:58)
My pleasure. Anything else you’d like to cover?Michelle Kesil (22:02)
That feels complete, but before we begin to wrap up here, if someone wants to reach out, connect, and learn more, where can people find you, reach you, and connect?Jeff Hurst (22:13)
Yeah, so if you’re an individual landlord just trying to figure out how to get started, I’d suggest you join. We have a Facebook group for Furnished Finder landlords. That’s a great place to just meet people, network, get more information. Definitely encourage people to sign up on our site. Even if you don’t, even if you’re not yet ready to purchase a listing, you can download our AirDNA report.that helps you understand the dynamics of the industry. We’ve got a ton of how-to guides and videos. And then I’d encourage people to also check in on our podcast, which is called Landlord Diaries and hosted by two midterm rental professionals, each of them have about a dozen homes and help talk people through it. We maintain phone support seven days a week. And so you can reach us on the phone number on our website. And we also have a chat bot and dedicated team for customer service. so.
Unlike some of the other platforms, we’re here and excited to talk and look forward to hearing from everybody and helping you grow your investment portfolio.
Michelle Kesil (23:15)
Perfect, Jeff. Appreciate your time and your story. Thank you so much for being here.Jeff Hurst (23:21)
Thank you.Michelle Kesil (23:23)
Awesome. And for the listeners that are tuning into our show, if you got value, make sure you’ve subscribed. We have more conversations with operators like Jeff who are building real businesses and we will see you on our next episode.
