What are the pros and cons of renting furnished and unfurnished apartments?
In general, unfurnished properties are much more common and will generally rent better because many tenants already have their own furnishings. As well, most tenants want to make the rentals their home, decorating and furnishing it themselves.
That being said, there are exceptions. In some situations furnished rentals will perform better. Examples include:
• Vacation homes - most rentals are too short for the tenants to provide their own furnishings
• Transient homes - for example business people needing to work in a location for a few months
• College rentals - many students prefer to have furnished rentals
• Specialized rentals - where normal furnishings just wouldn't work
• Markets with high demand for furnished rentals - some markets just have demand for furnished rentals
There are of course pros and cons to furnished versus unfurnished rentals. For furnished rentals these include (the opposite is true for unfurnished):
• Higher rents
• Less competition
• Easier move-in process
• less potential renters
• shorter rent periods (most furnished rentals are of shorter duration)
• Potential damage of furniture (hence potentially more disputes)
• Higher security deposit needs
• Higher maintenance costs (generally offset by higher rents)
• More detailed move-in and move-out inspections
• Higher insurance costs for the landlord
Overall it comes down which type of business model you prefer when renting your properties. Furnished rentals generate more revenues per rental but require more effort.