As a landlord, deciding whether to rent your house furnished can feel like a big decision. Offering a fully furnished space could boost your rental income and attract a wider range of tenants, but it also comes with additional costs and responsibilities.
On the other hand, an unfurnished property may appeal to long-term renters looking to make the space their own. In this article, Action Properties Inc. will explore the pros and cons of furnished rentals, helping you make the best choice for your property, tenants, and market.
Let’s dive into the details and simplify your decision!
Understanding The Scope of a Furnished Property
A furnished apartment is a property equipped with essential furniture and items, allowing tenants to move in with minimal belongings. It provides convenience and comfort, often appealing to specific tenant groups. Here’s a breakdown of what it typically includes:
- Living Room Essentials: A sofa, coffee table, entertainment center, and optional extras like armchairs or bookshelves. These create a welcoming and functional living space.
- Dining Area Setup: A dining table and chairs sufficient for the property’s occupancy. Adding features like a sideboard or small bar cart can enhance appeal.
- Bedroom Necessities: Beds with mattresses, wardrobes, nightstands, and lamps. High-quality bedding and linens are optional but add significant value for tenants.
- Bathroom Basics: Shower curtains, bath mats, and sometimes towels. These items create a move-in-ready experience.
- Kitchen Equipment: Crucial appliances like a refrigerator, stove, microwave, and basics like cookware, utensils, and plates. Providing small appliances (e.g., coffee maker) can attract tenants seeking convenience.
- Lighting and Window Treatments: Overhead lights, lamps, and curtains or blinds ensure comfort and privacy.
- Decorative Touches: Rugs, mirrors, and artwork enhance the home’s ambiance.
Advantages of Renting Furnished Apartments
Let’s explore how renting a furnished apartment can elevate your property's appeal, attract the right tenants, and maximize your rental income.
Higher Rent Potential
Furnished apartments typically command higher monthly rents compared to unfurnished units. Tenants value the convenience of moving into a space that’s already equipped with furniture and appliances.
This is particularly true for those who don’t want the hassle or expense of buying and transporting their own furniture. The premium charged for a furnished rental can quickly offset the initial cost of furnishing the property, providing landlords with a steady boost to their income.
Attracts a Broader Tenant Pool
One of the biggest advantages of offering a furnished rental is its appeal to a wide range of tenants. These include professionals on temporary work assignments, students or interns, individuals relocating for a new job, or families in transition.
Furnished apartments also attract corporate clients looking for temporary housing for employees. By catering to such diverse groups, landlords increase their chances of finding tenants quickly, reducing the risk of long vacancy periods.
Faster Turnaround Between Tenants
Tenants looking for furnished apartments often need immediate housing. Whether it’s a business professional relocating for work or a student seeking accommodation for the semester, the convenience of a fully equipped apartment makes it easier to rent out quickly. This ensures shorter vacancy periods, allowing landlords to maintain a steady income stream.
Tax Benefits
Furnishing a rental property comes with an initial investment, but landlords can often recoup some of these costs through tax deductions. In many regions, furniture and appliances provided in a furnished rental qualify for depreciation claims. This can help offset the upfront costs and ongoing maintenance expenses, offering a financial advantage during tax season.
Challenges of Renting Furnished Apartments
Let’s look at how renting a furnished apartment can make your property more attractive and help you earn more income:
- Higher Rent: Furnished apartments usually allow landlords to charge more rent because tenants value the convenience of moving into a ready-to-live space.
- Attracts Short-Term Tenants: These apartments are ideal for professionals, students, or people on temporary work assignments, widening your tenant options.
- Faster Rentals: The added convenience of a furnished property often helps it rent out faster, reducing vacancy periods.
- Tax Benefits: In some areas, you can claim deductions for the furniture and appliances you provide, saving you money during tax season.
- Corporate Tenants: Businesses often rent furnished apartments for their employees, offering reliable and high-paying tenants.
- Stand Out in the Market: In competitive rental markets, a fully furnished apartment can attract attention and set your property apart from others.
Tailoring Furnishings to Your Market
The level of furnishing can vary based on the target demographic and rental market. For example:
- Short-Term Rentals: Higher-end furnishings and more decorative touches may be necessary to attract corporate clients or vacationers.
- Longer-Term Rentals: Basic yet durable furnishings are sufficient for tenants who might stay several months.
- Pro Tip: Always provide a detailed inventory list of included furnishings and their condition. This helps avoid disputes with tenants and ensures accountability for any damages.
Furnished Vs. Unfurnished: Which is Better?
Let’s compare the key differences between furnished and unfurnished rentals to help you decide which option works best for your property and tenant needs.
When providing a furnished rental, you can expect:
- Higher rent
- Higher maintenance
- More short-term tenants
- Potential to find tenants faster
- More frequent upkeep
- Significant upfront costs
On the other hand, unfurnished rentals can provide:
- Steady rent
- Lower expenses
- Long-term tenants
- Less maintenance
- Less upfront costs
Bottom Line
Deciding whether to rent your house furnished or unfurnished depends on your goals, target tenants, and market conditions. Both options have their benefits, and the right choice will depend on what works best for you as a landlord. Furnished rentals can boost income and attract short-term tenants, while unfurnished properties appeal to long-term renters with fewer maintenance concerns.
If you’re still unsure, why not let the experts help? Action Properties specializes in managing all aspects of your rental property, from marketing to tenant management. Contact their team today and enjoy hassle-free property ownership while maximizing your rental income!