Furnished vs Unfurnished

"Should I make my house into a furnished or unfurnished rental?"

This is a question I get a LOT, and the answer will depend on your situation.

1. For those of you who want to use your home on a part time basis, and rent it out when you're not there, the answer is easy. Furnished.
2. For those that are using your property purely as an investment, you'll have to do some math:
3. What are you average utility bills? For a furnished rental you'll need to provide the tenants with utilities.
4. Can you afford to furnish your home? AND make it look on par with the other rentals in your area? Everything rents at the right price, but a home that is staged / furnished well is more desirable, can ask a higher price, and rents much faster.
5. Neutral reigns. Don't fight it. I violated this rule and paid the price. The living room walls in one of my properties were green. Yes, green. Not that soft almost white green, but a green that bordered on day-glow neon. I loved the color, but no one else did. My property didn't start renting out until I painted the walls.
6. Calculate in a 20% non-occupancy for your furnished rental. Those gaps between reservations can add up. I'm not saying you'll have that kind of non-occupancy rate, but it's best to be prepared.
7. Whether furnished or unfurnished, make sure you can afford the holding cost of having your property vacant until it rents.
8. You can charge more for furnished rentals than non-furnished, about 20% more.
9. In the summer, rates for furnished rentals go up, earning you extra profit during the peak season. A nice summer bonus.
10. Don't forget, you'll be able to write off the furnishings on your taxes, offsetting the income.
11. Another question you may want to ask yourself before deciding whether to own a furnished or unfurnished rental, is how long do you plan on owning the property? If you are only going to own it for a few more years, it might not make sense to furnish.

If you'd like us to take a look at your home and help assess which alternative would work best for you, please feel free to reach out.

We'd love to help.