Should I rent my property furnished or unfurnished?

Furnished rentals can be an attractive option for landlords looking to boost their rental income and appeal to a broader range of tenants. However, they also come with additional costs and responsibilities. If you're considering offering a furnished rental, it's essential to weigh the benefits against the potential challenges.

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Boosting your rental income

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Furnished rentals can, but not always, command higher rent than unfurnished properties.

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This is due to the added convenience they offer to tenants, who can move in without the hassle of bringing their own furniture.

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However, it’s important that the furniture in your property is modern, clean, and presents well in order to attract higher rental income.

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If the furniture is old or dirty, it can have the opposite effect and turn off potential tenants. 

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Furnished properties typically suit more transient tenants

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Typically, furnished properties appeal to tenants looking for short-term leases, including corporate clients, students, expatriates, and travelers. 

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These types of tenants tend to pay more for furnished properties, however, the downside is they aren’t as stable as tenants who need a rental on a more long-term basis. 

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Frequent tenant changes mean more time spent on marketing, screening tenants, and handling lease agreements, and subsequently higher vacancy periods.

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Optimising your taxable income

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In Australia, property investors can claim the depreciation on some furniture purchased for their rental properties, helping to offset the associated costs. However, it’s best to speak to your accountant to determine how this will impact your personal circumstances. 

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Be prepared for higher upfront and ongoing costs

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Furnishing a rental property requires an initial investment in furniture. Quality furnishings can be costly, and lower-quality options may need to be replaced more frequently, so it’s important to weigh this up when deciding how much you want to spend.

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Furnished rentals also experience higher levels of wear and tear due to tenants frequently using the provided furniture and appliances. This means higher maintenance, and replacement of broken furniture is necessary if it forms part of the rental agreement.

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Considering storage and logistics challenges

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Finally, if a tenant prefers to use their own furniture, you’ll need to put your furniture in storage. This can lead to greater hassle and costs if you need to pay for storage.

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Deciding whether to offer your rental furnished comes back to your own circumstances and investment goals.

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If you are in an area with high demand for short-term rentals and can manage the added responsibilities, a furnished rental may be a great option. However, if you prefer long-term stability with minimal maintenance, an unfurnished rental might be the better choice.

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At Rent Choice, we can help you navigate the best rental strategy for your property, ensuring you increase your returns while minimising potential risks. Get in touch with us today to explore your rental options!

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