Pros and Cons of Leasing a Fully Furnished Flat
Property owners usually face a dilemma – to lease a fully furnished suite or an unfurnished one? Which one is better? There’s no easy answer here.
We’ve found that it’s best to consider the merits of one of the two – the fully furnished one. It’s always best to decide whether something is good or not by making a list of its good and bad sides. We will give you all the pros and cons of leasing a fully furnished residence, so you can get a clearer picture and decide if that’s the way you should go.
Some might think that the price is a negative for fully furnished apartments – as it’s expensive to equip an entire rental for your tenants. However, they are not looking at the bigger picture: fully furnished rooms will yield a higher rent making it a better long-term investment.
Naturally, the price will differ from city to city, but the overall picture is clear – fully furnished always bring higher rent.
Changing Tenants More Often
Furnished units are usually rented by people who are only looking to stay somewhere temporarily. It usually means that your tenant turnover will be high.
However, this is not necessarily the case. Some people are looking for long-term furnished rentals. Although, changing your tenants often is good for some landlords, as they get the chance to make upgrades to modify the price before getting a new tenant.
It depends on the state, but based on whether or not an apartment is furnished, you get to charge a different security deposit. Unfurnished flats have a smaller maximum amount set than furnished ones. In California, you can only charge a maximum of two months’ rent for an unfurnished flat, while a fully furnished one will yield you a deposit of three months.
The Happiness of Tenants is Debatable
A furnished place has from time to time, become problematic due to complaining tenants. People are usually much more comfortable with their furniture, and when they have an already furnished suite, they tend to be less happy and might complain more about the furnishings.
Protection from Damage
A big plus of a fully furnished apartment is the fact that your furniture is protected from damage with the security deposits we already mentioned or additional lease addendums. Plus, with furnished properties, tenants don’t have to bring or take out the furniture, so they cause no damage to the property itself by moving furniture around.
One apparent negative aspect is that you have to pay for extra insurance for your furniture. That way you’re offsetting some of the extra profit you gained through a more substantial rent.
The Target Market is Predictable
Furnished accommodations usually attract people with more disposable money like young families, students, and young entrepreneurs and professionals – all in all, people who haven’t yet accumulated furniture on their own. It inherently means that you will always be able to rent this type of flat if you have it in a more urban area or a college town.
All of this information will undoubtedly prove helpful for you to reach a decision on leasing a fully furnished or an unfurnished flat. For more information, you may reach us at info@LLCPM.com.