Renting a furnished vs. unfurnished commercial property?
A furnished rental or apartment refers to an apartment where the landlord has availed to the tenant space, and in addition, other items are provided. These include couches, beds, tables, chairs, and essential kitchen appliances around the dining room. On the other hand, an unfurnished apartment means that the rental unit will be empty, and the tenants are expected to buy such items for themselves.
However, of importance to note is that an unfurnished unit still has some minimums. These include:
- Kitchen fixtures.
- Curtains, sheers, and blinds.
- Bathroom fixtures.
- Bathroom fixtures, including shower or bathtubs.
- Some common appliances, including a cooker, fridge, freezer, and washing machine.
Many people usually prefer furnished apartments since they do not have to purchase all those items since they are provided. However, others argue that unfurnished rental units are better since they are relatively cheaper and keep the tenant on their toes as they strive to pay the rent and purchase the items missing in the house.
Pros and risks of Furnished and Unfurnished Rental units.
This blog will look at the pros and cons associated with both furnished and unfurnished properties.
Furnished Units.
As mentioned earlier, you will find several items provided by the property owner in a furnished space. This is in addition to the minimum requirements found in unfurnished properties.
Some landlords might see it essential to supply everything to their clients to enhance comfort, and therefore it means that the rents are likely to be higher.
Extra inclusions that are found in a furnished property include;
- Sofas and/or armchairs.
- Dining tables and chairs
- Tables
- Wardrobes
- Beds
- Drawers
Pros of Furnished property.
- Higher Rent.
As a general rule of thumb, the cost of renting a furnished apartment is higher. The tenants enjoy extra amenities at the cost of the landlord. They pay for that convenience with a higher rental price.
- Higher Security Deposit.
For fully furnished apartments, landlords can charge higher security deposits to meet the possibility of damage not only to the property but also to furniture and appliances. We recommend that you check out the State provisions on security deposits.
- Predictability of your potential target market.
If your rental property is located near a college or has an urban setting, chances are higher that you will enjoy a good flow of tenants since most would be looking for such options.
Cons.
- The rents paid by those living in furnished houses are relatively higher since the landlord has provided some of the items in the home, such as furniture. It might scare away potential tenants.
- The initial cost of outlay is higher since the landlord has to provide the necessary appliances and amenities that would allow for a tenant to move in.
Unfurnished Property.
Pros.
- It is relatively personal.
From our experience, a better percentage of tenants are looking to personalize the rental space to their own tastes and preferences. Such a tenant is willing to stay longer as they feel better invested. And who doesn’t like a stable and longer tenancy?
- Relatively less expensive.
Although we said the same about furnished units, the unfurnished property will be cheaper to rent out. As the landlord, you only have to provide the basic requirements as per the lease agreement and provisions of the law.
- Fewer worries.
Landlords leasing out an unfurnished property don’t worry about the possibility of tenants, their guests, or pets damaging the appliances and furniture. You can be guaranteed peace of mind compared to your counterpart offering furnished property.
Cons.
Unfurnished properties are not ideal in a rental market that is considered professional-oriented. Most tenants would prefer furnished options that reduce the time of moving in and are less stressful for them.
Conclusion
Is there any recommended answer between leasing out a furnished vs. unfurnished space? From our experience in the Tucson real estate industry, each property’s needs and those of the landlord need to be assessed on a case-by-case basis. Taking into consideration these unique needs is when a customized solution can be found.
Rely on the property investment experts from Sapphire Capital Investment to provide you with professional advice to guide your investment in real estate.
