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Investment in apartment – Furnished or unfurnished

If you are an apartment investor, choosing the route of furnished or unfurnished apartments is a very important decision. You must select what will maximize your income and protect the total investment in your building. This is not an easy choice and I have made a stand, so I will give you my opinion on the pros and cons of furnished and unfurnished rentals.

Of course, the easiest and simplest thing to do when investing in an apartment building is to rent the units unfurnished. For most, this is a good steady income without worrying about the furniture or wear and tear on the items you bought. Some tenants like to settle into rentals for years and all you have to do is provide occasional maintenance, fixing minor plumbing issues, broken windows and the like. Some tenants prefer shorter rental terms, which means you have to freshen up the apartment with painting and other maintenance to keep the units looking fresh for the next tenant.

In general, there are far fewer things to think about when renting unfurnished apartments compared to furnished ones; the lease term and maintenance are the main considerations. The location of the property, the style and maintenance of your building will determine the type of tenants you will attract, so this is an important consideration in determining whether you should rent furnished or unfurnished apartments.

With a short-term renter, a month-to-month lease on a furnished apartment is often very attractive. For example, people in the military are usually assigned for short periods and don’t like having to transport furniture from one duty station to another. Also consider traveling employers and traveling nurses who work short-term assignments. These are perfect renters for furnished apartments and these great renters cause minimal damage because their companies often rent the apartments for them so they have extra inventiveness to be nice renters.

Some municipalities allow you to divide apartments into separate rooms to create shared units. Apartments with shared common areas have huge earning potential. A furnished room is very convenient for renters who want to travel light or who want to maximize their income by sharing expenses with others. Since many people travel on assignment and have other homes, they are primarily concerned with working and having a safe place to sleep at night. We don’t want to assume that all short-term renters looking for a furnished apartment are homeless types.

Tenants who rent furnished apartments are often willing to pay a little more for apartments, first because they get more. Second, most will already have a full set of furniture somewhere else and simply don’t want to have to move or store their items. Since they are using your furniture, they accept responsibility for taking care of it and paying a security deposit to cover any damage. In general, you, as a landlord, have a higher class of tenant.

The decision to rent furnished or unfurnished apartments has a huge impact on the type of tenants you can attract. If you prefer to attract higher priced tenants looking for shorter term leases than furnished rentals, it’s the way to go. If you prefer long-term tenants who like to nest for a year or more, a clean, well-maintained, empty apartment is the right choice. In the end, the decision should be based on what is the most profitable situation for you, the investor.

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