There are numerous questions a landlord must answer before letting out his or her property, and one of the most common conundrums property owners face is the question of furnishings. Should the apartment be furnished and ready for move in? Or is it a better financial move to allow tenants to bring in their own furniture? There is no standard answer to this question, and it’s essential to take individual circumstances into mind before making a decision one way or the other. We’ll delve into the pros and cons of each to help you formulate your decision.
Attractive to Tenants
For many tenants, the prospect of a furnished property, complete with living room furniture, beds, and more is very attractive. Tenants who don’t own their own furniture will be willing to pay more to live in a home that comes complete with all they could need. Some studies have found that landlords can charge as much as 50 percent more in rent for a furnished property. And with today’s technology you don’t even need to leave your house. There are many comprehensive websites that offer huge selections of affordable furniture online.
Better Tax Benefits
By furnishing a rental property, you may find that you can claim the furnishing costs on your taxes under the terms of a 5-year depreciable asset. A lawyer from a company like Justia.com can help you work through the specifications of available tax breaks and credits available on your property.
As mentioned above, tenants that look for furnished properties tend to be short-term renters, so if you’re looking for a tenant that will stay for years to avoid turnover, you may elect to leave your home unfurnished. Furnishing will also limit your potential pool of tenants, as you’ll be focusing likely on a demographic of people including first time renters, those with short term housing needs, and potentially students.
Allowing renters to use the furniture you’ve purchased means preparing for the wear and tear said pieces might incur during the length of the tenancy. You may find your furniture is damaged at an accelerated rate, and it may be necessary to update, repair, and improve furniture and décor between tenants. You may also find that you’re on call for repairs more often, as televisions go out, appliances break down, and damages occur.
At any given time there are a larger number of unfurnished rentals available for rent, and it’s easy to see why considering the advantages. However, there are downsides to unfurnished rentals as well.
Tenants looking to make a place feel like their own, and generally those looking for a long-term apartment or house may prefer an unfurnished place. This will allow them to put their own spin on décor and furniture. Providing a blank slate is attractive to many tenants, and because you can stipulate the type of furniture in your lease, there’s a level of control over what’s allowed in the property to avoid excessive damage.
When tenants bring in their own furniture, you’ll be less likely to have to take part in frequent maintenance. When tenants do move out, taking their furniture with them, getting the space ready for a new tenant will be much easier, as you won’t need to work around bulky pieces or worry about damaging any pieces within the house.
You Can’t Charge As Much
You will fetch a much lower rent price for a home that goes unfurnished. As mentioned earlier, furnished properties can charge much more, and these higher prices are often expected and agreed upon easily by those looking for the convenience of a home with furniture and décor already provided.
The Likelihood of Household Damage
By allowing individuals to bring in their own furniture, you do make your property a bit more vulnerable. Heavy furniture can cause nicks in the floor and walls, especially during the moving process. Whether it’s water beds or hot tubs, heavy wooden tables or moving mistakes, be prepared for the likelihood of damage to walls, floors, and ceilings, often only noticeable once said tenant has moved out. There are ways to minimize risk of this damage: have an airtight lease detailing furniture allowances and be sure to put prospective tenants through rigorous credit checks through a company like MySmartMove.
There are advantages and disadvantages to both options. Whether you choose to furnish your property or leave it bare, consider your financial parameters and take into consideration the type of tenant you wish to attract and retain.