When you have an income property, you have a lot of decisions to make.
Whether or not to allow pets, how to advertise your unit, and how long you want your lease to be are all essential decisions to make. Another important consideration for investment property owners is whether to rent their income properties as furnished units.
There are pros and cons to renting out your property furnished, and it certainly won’t be the right choice for every landlord or every property. Here’s how you can make the best decision when it comes to keeping your unit furnished or renting it unfurnished.
Consider Your Rental Market
Your rental market is the most important factor when considering whether or not to furnish your unit. For example, people looking for short-term rentals expect that these places will be at least semi-furnished, if not fully furnished.
In a semi-furnished unit, a property owner provides all the necessities, such as a bed, tables, chairs, and a sofa or couch. However, it doesn’t normally include things such as utensils or dining ware. On the other hand, a fully furnished unit typically has everything a renter needs to move right in with only their personal belongings.
Short-term rentals can include properties where military families, students, or tourists typically rent out. If you have a 6-month lease or a month-to-month rental, your tenants are going to expect that the property is furnished to some extent.
A long-term rental situation is a bit different. These are people who are looking to make the property their home for the foreseeable future. Most of these tenants want an unfurnished unit where they can bring all their furniture and items to personalize the space for themselves.
Weigh the Pros and Cons
Whether you cater to short-term renters or want a long-term tenant, there are pros and cons to renting your income property furnished.
You can charge more for the security deposit as well as the rent with a furnished unit. You also won’t have to worry about renters moving their furniture in and out, which can cause damage to the walls and floors.
The cons, however, are dealing with any damage your renters may cause to the furniture. Although you’ll charge more for the security deposit and rent to cover these costs, you still have to deal with repairing or replacing items, which can be a hassle.
You’ll also have to include extra information in the lease about which items are on the property and document what condition they are in. This creates more work for landlords to have to inspect and document items prior to tenants moving in and moving out.
Renting your unit unfurnished can save you time and money in dealing with purchasing and maintaining furniture, but for your rental market, renting semi-furnished or fully furnished may be necessary to attract your ideal tenants.
Always Include Policies in Your Lease
Always include information about the furniture in your lease to be clear that the tenants are responsible should furniture get damaged during their stay. You may also want to consider requiring your occupants to have renter’s insurance, which will help cover damage.
Including this information in your lease will help minimize disputes about the furniture and make it clear to tenants that you will be inspecting and documenting the condition of the furniture, and may retain part of the security deposit to fix any damage.
Let Us Help You Manage Your Northern Virginia Property
Managing an income property doesn’t have to be stressful, even if it is furnished. At Circle Property Management, we partner with investment property owners to help keep their investments profitable for the long run. Contact us today to discover how we can support your income property’s success at (703) 349-0144!
About The Author
Eric Guggenheimer - SFR, ARM ® » Principal Broker, Certified Property Manager, IREM, ARM, NARPM, NVAR, NAR, VAR