The hidden value of Airbnb is in the “medium-term” rental market.

Fully-furnished monthly rentals work well on Airbnb. With the housing market hot, homebuyers often need places to live in-between houses. Especially if they are moving to a new area as I did.

Work from home is a huge boost to this market.

Longer-term travel has increased because people can work from anywhere. Monthly rentals have become a home away from home for people looking to escape or visit a new city. It's an underserved market.

People want to stay somewhere for 1-3 months, and 6 in some cases.

There are 7 big advantages to monthly rentals

1. They make more money than long-term rentals. 12-Month rentals are going for $1,200-1,800 in my area of Austin. Furnished monthly rentals are $2,400-3,000.

2. More stable income: Assuming you book out, you don't risk vacant weekends like an STR.

3. They are easier to manage: It's much more passive. You only get 12 bookings per year at most. That’s fewer guest interactions, no software needed, and fewer cleanings to coordinate.

4. There are fewer regulations: Many markets, like Austin, restrict how many short-term rentals you can operate. Others, also like Austin, tax them heavily. There are fewer laws for rentals longer than 30 days.

5. Lower operating expenses because of fewer guests and taxes.

6. Better guests: Guests are more likely to treat your property as a 2nd home because of the time they spend there. There are fewer partiers. They are also more likely to be people traveling from work, working from home, or traveling nurses.

7. Less competition: Only about 5-10% of listings are monthly in Austin.

Consider monthly rentals as an investment strategy

This is a sweet spot for many investors.

Operating them is as passive as a long-term rental. Plus, they are more profitable. You won't make as much as a short-term rental but have fewer headaches.

That means your hourly rate of time you invest could be higher.