While there are definite benefits for tenants who rent a furnished apartment, it’s important for the property owner to determine whether it makes sense for them to furnish their units.
If this is a choice you’re currently facing, it makes sense to weigh the pros against the cons. Considering the following factors can help you make the best decision for your situation.
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Pros
Here are some good reasons to add furnishings to your rental unit. Many property owners offer furnished rentals to take advantage of these benefits.
Charge More for Rent
You’ll find property management in San Diego more lucrative with furnished apartments because you can ask for more in rent. Typically, a short-term rental (less than 1 month rental terms) that’s furnished can earn 50% more than an unfurnished unit. For long-term rentals, the scale is a little different. Long-term (1 year lease or longer) furnished rentals typically do not rent for more, as most tenants looking for a 1 year lease or longer, already have their own furnishings. For a furnished long term rental, the demand is limited.
Request a Higher Security Deposit
Furnishing a rental unit can represent a significant cash investment. Even modest furnishings can cost several thousands of dollars at the outset, and you’ll spend just as much trying to replace damaged items. For that reason, you’re justified in asking for a higher security deposit, and renters may be willing to pay a little more as well.
Keep a Closer Eye on Your Property
You can use the help of a company that provides property management in San Diego to help you keep a closer eye on your furnished rental units. They can provide inspections and furniture cleanings. Your tenants will expect these intrusions as the price of living in a furnished unit, and they will be more conscientious about caring for your property. However, Tenants have the right in their lease to “quiet enjoyment”, so you will likely be limited to one to two inspections per year.
Cons
There are also drawbacks to offering furnished apartments. While you might find that the pros far outweigh the cons, you should be aware of these drawbacks.
More Items Can Be Damaged
In an unfurnished apartment, there is far less that can be damaged by a disrespectful tenant. When you furnish the unit, you’ll be faced with the possibility of those furnishings being ruined. The more furniture you bring into the unit, the more damage to your property can occur. Property Management in San Diego Is More Hands-On
People who rent furnished apartments may not be looking for long-term situations. Most tenants in furnished apartments are students, travelers, or business professionals who may stay in one place for a brief period. This means you’ll probably have to spend more time filling vacant units. If you experience excessive vacancy (3 months or more), you would likely be better off doing an unfurnished rental on a one year lease.
Furniture Depreciates
Even with the best care, furniture will depreciate through normal use. This means you’ll eventually have to replace furnishings even when you have respectful tenants. This may involve paying for new furniture out of your own pocket, so you should be prepared for that added expense. Fortunately, most quality furniture will last for several years.
Some Prospective Tenants May Be Reluctant
As the saying goes, you can’t please everyone all of the time. While you’ll find that there are some people who want furnished units, there are many more people who are put off by furnished apartments. You won’t attract tenants who are families, or established professionals, with furnishings of their own.
Established adults face the added expense of storing their own furnishings. They won’t want to deal with that challenge, so they will be more interested in unfurnished apartments with enough space for their own belongings.
You should also keep in mind that either choice can be temporary. If you start by offering unfurnished rentals, you can always furnish the unit the next time it’s vacant. Similarly, you can remove furnishings from an empty unit if you determine that keeping the unit furnished has become too problematic. Experience may help you make a better choice in the future.