Thinking about renting out a Frisco property but not sure if short-term or long-term makes more sense? You are not alone. With strong population growth, corporate activity, and a steady stream of events, the Frisco market can support both strategies, but each performs differently and comes with distinct rules, costs, and time commitments. In this guide, you will learn how demand works in Frisco, what to expect operationally, how to compare returns, and what to check before you choose. Let’s dive in.
Frisco rental demand at a glance
Frisco sits in Collin County within the Dallas–Fort Worth area, part of the Dallas–Plano–Irving corridor. Growth, employment, and amenities shape rental demand at the city, county, and metro levels. That means you should think locally and regionally when assessing rent potential.
Several drivers support rentals:
- Population and household growth across Frisco and Collin County support stable long-term demand.
- Corporate relocations and major employers in the Dallas–Plano–Frisco corridor create steady need for long-term and mid-term housing.
- Events and sports activity around Toyota Stadium, The Star in Frisco, and the area’s convention calendar create episodic short-term spikes.
- Connectivity to Dallas North Tollway and State Highway 121, plus access to DFW and Love Field, makes Frisco attractive to visitors and commuter tenants.
- School quality and community amenities, including parks, retail, and entertainment, are consistent strengths for long-term renters.
Short-term rentals: When it works
Short-term rentals can outperform during busy periods tied to events, corporate travel, and holidays. They also give you flexibility to adjust pricing and availability. The tradeoff is more volatility, higher operating costs, and tighter compliance responsibilities.
STR performance metrics to track
- Average Daily Rate (ADR)
- Occupancy Rate
- Revenue per Available Rental (RevPAR)
- Gross Monthly Revenue
- Operating Expenses and Net Operating Income (NOI)
- Cash-on-cash return and cap rate
Use a 12‑month pro forma with optimistic, base, and conservative scenarios. Model occupancy by month, estimate bookings and cleaning frequency, and include platform commissions.
STR cost considerations
- Furnishing and staging as upfront capital
- Utilities, Internet/TV, and frequent cleanings
- Repairs, faster replacement cycles, and higher maintenance reserves
- Platform fees and marketing costs
- Short-term rental specific insurance coverage
- Local licensing or registration expenses, plus tax compliance
STR legal and tax checkpoints
- Confirm City of Frisco requirements for STR registration or permits, including any inspection, insurance, and local contact rules.
- Verify local hotel occupancy tax obligations and Texas sales tax for short stays. Check whether booking platforms remit on your behalf in this jurisdiction.
- Review zoning and any neighborhood or HOA restrictions, including potential minimum stay rules.
- Keep detailed records for income taxes, including depreciation, mortgage interest, and allowable deductions. If you provide substantial services, consult a CPA about possible self-employment tax exposure.
Long-term rentals: Stability and fit
Long-term rentals generally deliver steadier occupancy and simpler operations. In Frisco, family-oriented demand, proximity to jobs, and community amenities often support multi-bedroom homes on 12‑month or longer leases.
LTR performance metrics to track
- Monthly Rent and Vacancy Rate
- Annual Rent Growth Assumptions
- Turnover Costs and Renewal Rates
- Operating Expenses and Net Operating Income (NOI)
- Cash-on-cash return and cap rate
Model a multi-year pro forma with conservative vacancy, maintenance reserves, and periodic turnover.
LTR cost and management basics
- Furnishings are usually unnecessary for unfurnished leases
- Tenants typically pay most utilities
- Property management fees are generally lower than STR managers
- Budget for leasing, screening, and occasional legal costs
Texas landlord-tenant overview
- The Texas Property Code governs deposits, notices, repairs, and evictions.
- Texas does not have rent control statewide.
- Work with a knowledgeable property manager or attorney to comply with notices and timelines.
Compare returns the right way
You want an apples-to-apples view of what hits your bank account, not just gross revenue. Build side-by-side pro formas.
For short-term rentals, include:
- ADR assumptions by season and a realistic occupancy curve
- Booking frequency and cleaning cost per stay
- Platform fees, supplies, utilities, lawn care, and pool care if applicable
- STR insurance premium, licensing costs, and tax compliance
- Maintenance reserve and faster replacement cycles for furnishings
For long-term rentals, include:
- Market rent for comparable properties and expected rent growth
- Vacancy and turnover every 12 to 24 months, plus leasing fees
- Property management at typical local rates
- Routine maintenance, insurance, and property tax trends
Then compare:
- Gross yield: annual gross rent divided by purchase price
- Net yield: NOI divided by purchase price
- Cash flow after financing: NOI minus mortgage payments
- Sensitivity: vary occupancy, ADR, and interest rates to see best- and worst-case outcomes
Property selection in Frisco
Picking the right home and neighborhood makes or breaks performance, especially for STRs.
- Single-family homes with 3 or more bedrooms attract long-term tenants and can host visiting families during events.
- Condos and townhomes may be efficient for STRs, but HOAs often restrict short-term stays or set minimum rental periods. Always confirm the CC&Rs.
- Homes near major employers, The Star, Toyota Stadium, and major roads can support premium rates during peak periods.
- Newer builds and amenity-rich communities can command higher rents, but verify rental rules before you buy.
Operations and management choices
Your management model affects both returns and lifestyle.
- Self-managed: You can save fees, but STRs require rapid response, frequent turnover, and local vendors on call.
- Professional management: Long-term managers commonly charge about 7 to 12 percent of monthly rent. STR-specific managers often charge 20 to 35 percent or use per-booking fee structures. Request written scopes of work and compare apples-to-apples.
Operational best practices:
- Short-term rentals: professional photography, accurate house rules, safety devices, a reliable local contact, and high-quality cleaning
- Long-term rentals: thorough tenant screening, clear maintenance terms, required renter’s insurance, and renewal planning
- For both: appropriate insurance coverage and an emergency repair plan
Risks to consider and how to mitigate
Primary risks include regulatory changes, demand swings, higher STR operating costs, and neighborhood fit. A targeted due diligence plan reduces surprises.
Use this checklist before you commit:
- Confirm legality and any permit or registration with the City of Frisco
- Review HOA rules for rental limits or minimum stay requirements
- Run STR comps for ADR and occupancy and LTR comps for monthly rent
- Get quotes for STR versus landlord insurance and for both STR and LTR property management
- Build conservative pro formas with sensitivity to occupancy, ADR, and financing costs
- Verify hotel occupancy tax and sales tax obligations and consult a CPA on income tax treatment
- Evaluate parking, noise, and neighborhood compatibility for an STR
When to switch strategies
Your first choice is not permanent. You can pivot as conditions change.
Consider switching if:
- Local rules or HOA restrictions tighten for short-term rentals
- Your STR revenue declines off-season and no longer beats long-term rent after expenses
- You want simpler operations or more predictable cash flow
- Corporate relocations or personal timing make a longer lease more practical
Transition tips:
- For STR to LTR: defurnish as needed, set market rent, update insurance, and screen tenants
- For LTR to STR: confirm legality, obtain any required registration, furnish and stage, and plan a professional cleaning schedule
Your next step
Whether you favor income stability or flexible revenue, the right answer in Frisco comes down to your timeline, risk tolerance, and property’s location and rules. If you want a clear, data-backed plan tailored to your address and goals, schedule a private consultation. You will get rental comps, an apples-to-apples pro forma, and a local compliance roadmap so you can move forward with confidence.
Ready to explore your options in Frisco and surrounding north-DFW suburbs? Connect with Teona Harris for a discreet, expert consultation.
FAQs
Biggest differences between STR and LTR in Frisco
- STRs can yield higher peak revenue tied to events and corporate travel but come with more volatility, higher costs, and stricter compliance. LTRs typically deliver steadier occupancy and simpler operations.
Permit and hotel tax rules for STRs in Frisco
- You should confirm City of Frisco registration or permit requirements and whether local hotel occupancy taxes and Texas sales tax apply to your bookings, including any platform remittance.
Event impact on STR occupancy near The Star and Toyota Stadium
- Sports, tournaments, and conferences can boost short-term demand around event dates, so pricing and occupancy often rise during these periods and normalize afterward.
Typical management fees in Frisco for STR vs LTR
- Long-term property managers commonly charge about 7 to 12 percent of monthly rent, while STR managers often charge 20 to 35 percent or per-booking fees depending on services.
How to model cash flow before choosing a rental strategy
- Build a 12‑month STR pro forma with ADR, occupancy, cleaning cadence, and all fees, and a multi-year LTR pro forma with rent, vacancy, turnover, and management. Compare NOI, cash flow after financing, and sensitivity to key variables.
