In Florida, there is no law that requires landlords to provide a furnished or an unfurnished rental. The decision is solely yours to make as a landlord.
You can rent out your rental with nothing but bare walls and floorboards. Or, you can rent it with every possible appliance, like a dishwasher and a washing machine. Your decision should, however, be an informed one.
Vacancies are not good for business, so you want to make sure that your home has a low vacancy rate. This means ensuring your rental unit is desirable to tenants.
So, should you rent out your property furnished or unfurnished? Well, it depends! There are advantages and disadvantages to both!
In this post, we will examine the pros and cons of each option in order to help you make a better decision for yourself!
What is a Furnished Apartment?
A furnished apartment is one that provides tenants with all the furniture they need to live comfortably, like basic appliances, beds, and a couch. There are three types of furnished apartments: furnished, semi-furnished, and fully-furnished.
These terms have loose definitions, and no set rules exist as to what should or should not be included with each.
However, in generally, furnished apartments include the following:
- Basic kitchen appliances
- Beds
- Chairs
- A table
- A dining room
- A couch
- Coffee tables
Some landlords may also provide extras such as basic cookware, a microwave, a toaster, and table lamps.
A semi-furnished apartment only provides basic furniture and appliances, such as:
- A stove
- A refrigerator
- Tables
- Beds
- A couch
A fully-furnished apartment goes a bit higher than just the basics.
In addition to the basic, it’ll typically provide:
- Silverware
- Pans and pots
- Dishes
- Blankets
- Towels
A dryer and washer may also be included. It’s also possible to find décor like wall artwork.
Pros of Renting Out a Furnished Apartment
1. You may be able to charge higher rent.
This is the #1 reason most landlords rent a furnished unit.
The more desirable a property is, the more rent you can ask for it. The higher rent can help you cover the cost of the furnishings, depreciation, and offset the losses caused by renting to short-term tenants.
Besides asking for higher rent, you may also be able to ask a higher security deposit. The deposit helps provide cushion against any excessive damage to the furnishings.
2. You may be able to make some tax savings.
Providing a furnished rental can also help you reduce your tax bill. For something to be considered depreciable, it must meet 3 basic requirements:
- It must be able to last for more than a year.
- It must be valuable to the business.
- It must be able to lose part of its value over time.
Furniture and appliances fit the said requirements.
3. A furnished unit looks attractive.
When it comes to rental properties, desirability plays a crucial role. A furnished property is more desirable than an unfurnished one because it looks “ready-made”.
Furnished units are particularly a hit with first-time renters and students.
The Cons of Renting Out a Furnished Apartment
1. There is heightened risk of property damage.
No matter how thorough your tenant screening process is, there is always that 1% chance of landing a problem tenant. And, while you may require tenants to pay a security deposit, the constant replacement of furniture may become frustrating.
2. Furnished rentals appeal to short-term tenants.
Generally speaking, furnished rentals usually appeal to short-term tenants, such as students and first-time renters. This means the advertising and screening costs can add up to quite a lot over time.
What is an Unfurnished Apartment?
In contrast, an unfurnished apartment is a blank canvas. Tenants have the freedom to place whatever kind of furniture they desire in the unit.
Below are the pros and cons of renting out an unfurnished rental.
Pros of Renting Out an Unfurnished Rental
1. You have less responsibility.
As the landlord, you won’t be responsible for your tenant’s furniture. Since it’s their property, they will be liable for any damage that occurs to it.
Unfortunately, most tenants mistakenly think that the landlord’s insurance covers their personal belongings. That couldn’t be further from the truth. To prevent any misunderstandings, require all tenants to subscribe to a renter’s insurance policy. The policy will cover their personal belongings against risks such as fire, vandalism, and weather-related damage.
2. Tenants can personalize the home to their liking.
An unfurnished unit allows tenants to personalize the home to their appeal. This is not something that tenants may be able to do with a furnished rental.
This freedom typically encourages tenant to rent long-term as they feel “at home” in the rental.
3. You’ll have less maintenance to do.
Renting out a furnished apartment comes with tons of maintenance responsibilities. Even during a tenant turnover, you’ll have a lot to do to make the unit rent-ready. This is usually not the case with an unfurnished unit.
Cons of Renting Out an Unfurnished Rental
1. You won’t be able to collect higher rent.
You won’t be able to charge your tenants as much rent as you’d be able to with a furnished rental.
2. You may not be able to attract short-term tenants.
Short-term tenants are usually attracted to furnished apartments. As such, by providing an unfurnished rental, you’ll effectively be locking out a certain caliber of tenants. This means it may take you longer to fill your vacancies.
Bottom Line
So, to furnish or not to furnish? Again, that depends! There is no one-answer-fits-all.
You’ll need to conduct proper research and evaluate the local rental market in order to make the right choice for you.
For more information, feel free to contact Florida Property Management & Sales today!