Mid-Term Rentals vs. Long-Term Rentals in Temple TX: The Cash Flow Comparison (2026)

Which rental strategy makes more money in Temple TX — mid-term or long-term?

A furnished mid-term rental near Baylor Scott & White in Temple TX generates 43% to 100% more gross revenue than the same property rented unfurnished on a 12-month lease. A 3-bedroom home that rents for $1,754/month as a traditional long-term rental (LTR) can command $2,500 to $3,500/month as a furnished mid-term rental (MTR) targeting travel nurses and medical residents. But higher revenue does not automatically mean higher profit — mid-term rentals carry higher operating costs and more vacancy.

This analysis breaks down both strategies on the same $250,000 Temple property so you can see exactly where the money goes and which approach fits your investment goals.

The property: a real Temple buy box example

For this comparison, we are using a 3-bedroom, 2-bathroom home located within 2 miles of the BSW Temple campus. This is a typical investor acquisition in the Temple medical corridor.

• Purchase price: $250,000
• Down payment (20%): $50,000
• Loan amount: $200,000 at 6.5% (30-year fixed)
• Monthly mortgage (P&I): $1,264
• Annual property taxes: $5,250 (2.1% effective rate)
• Annual insurance: $2,100 (landlord DP-3 policy)
• Monthly tax + insurance: $612

Total monthly fixed costs (PITI): $1,876

This baseline is the same regardless of whether you go MTR or LTR. The difference is in the revenue, the variable expenses, and the amount of your time each strategy requires.

Strategy 1: Long-term rental (unfurnished, 12-month lease)

This is the traditional buy-and-hold approach. You rent the property unfurnished to a single tenant on a standard 12-month lease. The tenant pays their own utilities.

LTR revenue

LTR operating expenses

LTR bottom line

The reality check: At 6.5% interest rates and a $250,000 purchase price, a standard long-term rental in Temple is cash-flow negative with 20% down. This is the math that frustrates many out-of-state investors who remember the cheap-debt era. The property still builds equity through principal paydown (~$3,800/year) and benefits from appreciation, but it is not producing monthly income at these terms.

To break even with the LTR strategy, you would need to put approximately 35% down or purchase closer to $200,000.

Strategy 2: Mid-term rental (furnished, 30+ day leases)

Same property, but now you furnish it for $8,000 and list it on Furnished Finder targeting travel nurses at BSW Temple. You maintain a 30-day minimum to avoid the 13% hotel occupancy tax and Temple's STR permitting requirements.

MTR revenue

MTR operating expenses

MTR bottom line

Wait — both strategies lose money?

At 20% down and 6.5% interest on a $250,000 property, yes. This is the current reality for leveraged investors in most Texas markets, not just Temple. The debt service at today's rates overwhelms the cash flow on moderately priced properties.

But here is what the raw cash flow number misses:

What the spreadsheet does not capture

1. Principal paydown. Your tenants are paying down approximately $3,800/year in mortgage principal. That is forced savings in the form of equity.

2. Appreciation. Temple home values are projected to grow 1.2% to 2.2% annually. On a $250,000 property, that is $3,000 to $5,500/year in equity growth.

3. Tax benefits. Depreciation on the structure ($250K / 27.5 years = ~$9,090/year) plus Section 179 depreciation on the $8,000 furniture package in Year 1 can create paper losses that offset other income. For investors with qualifying "Real Estate Professional" status, these losses can offset W-2 income.

4. The MTR model scales differently with rent increases. A $200/month rent increase on an LTR adds $2,400/year. A $200/month rent increase on an MTR adds $1,920/year (accounting for 20% vacancy) — but the MTR started from a much higher base, and furnished rents have more upward flexibility than unfurnished rents.

When the MTR model wins clearly

The math shifts dramatically under three scenarios:

Scenario A: Higher down payment (25–30%)

The LTR breaks even around 35% down. The MTR needs about 38% down — but generates significantly more equity paydown and tax benefit along the way.

Scenario B: Lower purchase price ($200K)

At a $200,000 acquisition with 20% down:

At $200K, the MTR model turns cash-flow positive while the LTR still bleeds. This is why purchase price discipline matters more than rental strategy in the current rate environment.

Scenario C: Self-managed MTR (no property management fee)

Eliminating the 10% PM fee saves $3,360/year on the MTR model. For an investor willing to handle Furnished Finder communications, lease management, and turnover coordination remotely, this shifts Year 2 cash flow from -$9,271 to -$5,911 — and at a $200K purchase price, the self-managed MTR generates approximately $4,500/year in positive cash flow.

The real comparison: total return, not just cash flow

Cash flow is one piece of the return. Here is the full picture on the $250,000 property with 20% down over a 5-year hold:

In this specific scenario, the LTR actually produces a better 5-year total return because its lower operating costs result in less cash flow drag. The MTR model becomes superior when rents push above $3,200/month, occupancy exceeds 85%, or the investor self-manages.

Which strategy should you choose?

Choose LTR if:

• You want the simplest possible operation with minimal landlord involvement
• You are buying at a price point where traditional rents cover your PITI
• You are focused on long-term equity building and do not need cash flow today
• You prefer one tenant per year over multiple turnovers

Choose MTR if:

• You are buying specifically near BSW Temple or the VA and can target the healthcare traveler market
• You are willing to invest $8,000 in furnishing and actively manage listings on Furnished Finder
• You want to maximize tax benefits through accelerated furniture depreciation
• You plan to self-manage or use a PM company experienced with mid-term rentals
• You are targeting a property at or below $200,000 where the MTR premium creates positive cash flow

The hybrid approach: Some Temple investors start with an LTR to stabilize the property, then convert to MTR once they have the furnishing budget and operational systems in place. This lets you build equity and learn the market before taking on the complexity of furnished housing.

Run your own numbers

Every property is different. The tax jurisdiction (Temple ISD vs. Belton ISD, MUD vs. non-MUD) can swing your property tax bill by $2,000+ per year. The specific neighborhood determines your realistic MTR rate. And your personal tax situation determines how much depreciation benefit you actually capture.

If you want to analyze a specific Temple property using real local data — actual MTR comps, verified tax rates, and current insurance quotes — contact me directly or visit my investing in Temple page to see current opportunities.

For a deeper dive into why BSW Temple creates permanent rental demand, read my complete guide: Travel Nurse Housing Investment in Temple TX.

Frequently Asked Questions

How much more does a mid-term rental make than a long-term rental in Temple?
A furnished 3-bedroom MTR near BSW Temple grosses 43% to 100% more than the same property rented unfurnished — typically $2,500 to $3,500/month versus $1,700 to $1,800/month. However, operating expenses are roughly double due to utilities, turnover costs, and furnishing amortization.

What occupancy rate does an MTR need to beat a long-term rental?
At $3,000/month furnished rent, an MTR only needs about 60% occupancy to match the gross revenue of an $1,800/month unfurnished lease. Properties within 10 minutes of BSW Temple typically achieve 75% to 85% occupancy.

Is a mid-term rental harder to manage than a long-term rental?
Yes. You are managing multiple tenant turnovers per year, coordinating cleanings, paying utilities, maintaining furnishings, and responding to Furnished Finder inquiries. Most investors use a property manager experienced with MTR or dedicate 3 to 5 hours per week to self-management.

Can I convert a long-term rental to a mid-term rental?
Yes, and many Temple investors do this. Wait until your current lease expires, invest $8,000 in furnishing, list on Furnished Finder, and begin accepting 30+ day bookings. The conversion can typically be completed within 2 to 3 weeks.

Taylor Dasch is a licensed real estate agent with EG Realty and an active investor with 100+ transactions in Central Texas. He specializes in helping out-of-state buy-and-hold investors find cash-flowing rental properties in Temple, Belton, and surrounding markets. Contact: (254) 718-4249 | [email protected]