This method is nice in many ways. First, it does not require any administrative rights in the host environment. There is no need to set up any VLAN.
The main disadvantage of this approach is that from the perspective of the VM, there are two NICs to handle: one to connect through the host OS to the internet, and one to connect to the virtual network of other VMs.
Linux (and most operating systems) does not have any problems with using multiple NICs to interface to different networks. The operating system knows how to route network traffic intended to different networks correctly.
An easy way to fix this problem is to designate one of the VMs as a router that has one interface to the user mode network (to connect to the internet), and one interface to the virtual network. The same VM will be configured to act as a DHCP server to the virtual network.
Once we have a router, then all other VMs only need one NIC to connect to the router. Not only do they not need to have static IPs anymore, but each VM also only need one NIC.
An alternative is to set up a VLAN in the host environment. While this is a “cleaner” solution, it also require administrative rights in the host environment. Last, but not least, the method to set up a VLAN depends on the environment.