Should You Furnish Your Rental?

Should you furnish your rental?  The quick answer is ‘it depends on the property and the demographic’. Essentially, the properties that do better as fully-furnished rentals are vacation homes and seasonal rentals.  God knows Durango has a need for them!  Otherwise properties that are geared toward long-term renters do much better unfurnished.  So the two most important questions are: “what kind of property do you have?” and “What kind of renter are you trying to attract?”

Before you consider furnishing an apartment, it’s important to know what the expectations are of the renter.  A fully-furnished rental should offer the tenant a move-in ready home.  In theory, your new tenant only needs to unpack their toothbrush and clothes.  In addition to the furniture, they will likely be expecting everything else down to the smallest details including bedroom and bath linen, kitchen dishes, utensils, pots and pans and general cleaning supplies.  To figure out what is best for your rental property, we’ve compiled a few lists.

Pros of Furnished Rental

• You can charge a premium rent.
• You will still own all of the furnishings after the tenancy has ended.
• Furnished rentals can be the perfect solution for vacationers, students or people going through a relationship breakdown.
• Furnished rentals typically appeal to short-term renters.
• Short term leases are better for the property owner who wants to use the property as a vacation home.
• A furnished rental may mean less damage done in moving in and out.
• Short-term renters don’t assume they can put up shelves or make other modifications.
• Furnishings and their depreciation may be tax-deductible.
• Furniture can make a home much more attractive to potential renters who don’t have their own.
• Marketing a move-in ready rental means you are offering the complete package.

Image source: Booking.com

Cons of Furnished Rental:

• Furnished rentals tend to attract short-term renters from as little as one week to an average of 3-6 months.
• Wear and tear of valuable furniture may be accelerated with new tenant turn over.
• You’ll be expected to maintain, repair or replace the furnishings including the TV, stereo and appliances.
• If your rental property is a condo, many associations and co-owners won’t permit short-term rentals.
• With each tenant you must detail your rental’s inventory to guarantee contents don’t disappear without recourse.
• You will need to insure the unit’s contents to protect against loss and damage.
• The end of each short-term lease will require new marketing, fees and possible loss of income to vacancy.
• The furnished renter’s market is markedly smaller than the unfurnished one.
• Finding a renter tenant can take much longer.
• You may have a sizable outlay to furnish the rental initially.
• Furnished rentals require more updates, more maintenance, more attention and more cleaning.
• Short-term rentals require more bookkeeping.
• Furnished vacation rentals may languish during off-season periods.
• The more contents supplied by the owner, the greater the exposure to liability claims.
• Furnishing your property may limit the number of potential tenants based on your renter’s personal tastes and preferences.
• The idea of a slightly used mattress may make some renters, in an already limited market, a bit squeamish.
• Unless your furniture is pristine and doesn’t show the wear and tear of previous tenants, your new prospective tenants may not find the prospect of your former tenants personal habits very appealing.

Pros of Unfurnished Rental:

• The renter’s market for an unfurnished property is much larger than that of a furnished property.
• You are not responsible for cleaning, repairing, maintaining or replacing the contents of the rental.
• You are not responsible for insuring the contents of the property including the furnishings a tenant provides.
• Tenants who provide their own furnishings have a desire to make it their own and are less likely to damage it.
• There are not as many complications with an unfurnished unit.
• Cleaning the carpet, painting and general maintenance performed at the end of the tenancy won’t require moving rooms of furnishings.
• Typically unfurnished properties garner longer leases.

Cons of Unfurnished Rental:

• Less Rent
• The property may not show as well as a rental that has been fully staged with all the furniture, accessories and décor.

Hopefully this list allows you to make an informed decision about your rental.  If you have more questions about the Durango area specifically, you can call us anytime.

There are a few things worth considering when putting your rental on the market including your property’s location, your target demographic, your investment of time and the costs involved in both choosing to furnish or not.  At the end of the day you should furnish your property only if it will be more profitable, in the long run.

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