With so many landlords now offering furnished units, you might be wondering if you should do the same for your own rental. Obviously, you want to stand out from other properties and offer perks to your tenants. As a property investor, you want to align with the rental trends and evolve with the changing taste of renters.
Among the niche markets, fully furnished rental homes remain popular. They offer plenty of convenience and savings since that new occupants don’t have to hire a moving van to transfer their belongings. They also won’t have to save up to purchase home appliances. In other words, moving in is easier and less stressful.
So who wants to live in fully furnished homes? Commonly these are students who are staying for the school year to finish up their course of study and employees who are temporarily settling in an area to finish a work training or cover a short work assignment. Living in a furnished rental space makes more sense since the move is usually temporary.
As a landlord, is it worth spending extra time and money on furnishing the rental unit? This article will help your answer that question!
What do Furnished Homes Look Like to Landlords?
Though furnished homes mean it’s ready for move-in with furniture already set up, it’s still the landlord’s decision on what to actually include.
In general, this is what a furnished home offers:
- Living Room – Coffee table, sofa, TV set
- Bedroom – Nightstand, bed, dresser
- Dining Room – Several chairs and a table
- Bathrooms – Shower curtain and bath mat
- Kitchen – Stove, refrigerator, oven, toaster, dishware, and cooking utensils
Who Typically Rents Furnished Homes?
Furnished homes hold plenty of appeal for different market segments such as tourists, students and business people temporarily based in one area. With furnished homes, you don’t have to worry about decors and it’s also cheaper accommodation compared to staying in a hotel for a long period.
It also won’t make much sense to buy several pieces of furniture and appliances knowing you’ll move out in the near future. Opting to rent in a furnished rental is advisable and makes moving in far easier.
What are the Advantages of Furnished Rentals for Landlords?
The following are some of the advantages of providing a furnished rental:
You Can Assign an Above-average Rental Rate
With the convenience of moving in quickly, the rent fee is set higher. But before assigning a rent amount, it’s ideal to do market research around the neighborhood to ensure an accurate figure is set.
Your monthly rental charge should generate a return on investment but this must also be reasonable. Otherwise, competing rentals can draw your potential tenants away from you. Assess the quality of your rental, its location, and furnishings when calculating the rent price.
You Can Reduce the Damage from Moving Heavy Furniture
Furnishing rental property results in fewer scrapes, scratches, and dents on your walls and flooring. These marks are common in unfurnished units where heavy furniture is transferred around the unit. Thus, landlords get to save on maintenance costs by reducing the need to fix scuffed areas.
You Can Save Time by Focusing on a Specific Market
Since you’re now able to identify which tenant markets are drawn to furnished rentals, it’s easy to serve their needs. Designing marketing campaigns and highlighting amenities they’re attracted to allows you to pique their interest. You can also plan renovations in your rentals that include amenities desired by students, tourists, business professionals, or whoever else you’re looking to rent to.
You Can Request a Higher Security Deposit
Protecting your furnishing is a must when you accept occupants in your rental space. As such, landlords are allowed to ask for a higher security deposit amount. If appliances break down in your unit, you have available funds for repairs or replacement. Make sure to include this as a lease to better protect your property furnishings and reduce disputes later.
What are the Disadvantages of Furnished Rentals for Landlords?
When considering whether or not to rent out a furnished space, think about your investment goals. Here are some potential disadvantages to renting a furnished unit:
You Need to Invest in Furnishing Your Unit
Firstly, you’ll need to buy the furniture you’re planning on offering in your rental unit. Make sure you don’t over-invest or buy items that tenants don’t want or need. What’s more, when furnishing rentals, property owners need to consider the higher risks of damaged items.
To minimize this occurrence, investing in more property maintenance is required. You can also practice consistent property inspections and preventive maintenance. Requesting a high-security deposit can also reduce the risks since renters will want to work on getting the entire refund.
You Must Market Constantly
Given that renter who chooses furnished units are typically only looking to stay for a short duration, you’d need to step up your marketing efforts. Vacancies can be costly in terms of maintenance expenses so you need to focus on raising your rental’s exposure and attracting plenty of prospective tenants.
You need to be practical and study the location of your rental unit. Is it near a university, local attractions, and business districts? If so, you can easily focus on attracting students, tourists, and workers looking for a temporary place to live in.
From there analyze whether the rent rate you assign is affordable to your target market segment. If you’ve narrowed down which market you plan to attract then it will be easier to customize the furnishings according to their taste.
If you would like help managing your rental you can also partner with a trusted property management company. The team at Keyrenter Property Management South Florida offers a wide range of management solutions to help property owners achieve their investment goals. Contact us today to learn more about our services!