What are the pros and cons of renting a single family home furnished vs vacant?

Question

I have my own single family home in a nice middle America area of north Atlanta. I want to move out and wondered what are the pros and cons of leaving my furniture here and renting it out as a furnished home?

I get it that the furniture might not fit everyone's desires; someone might want a king size bed instead of a queen, and someone won't like the color of the sofa, or quality of the lamps and entertainment center, etc.

I would have to charge extra for the furniture to be here, knowing that people are going to put dings in it, spill stuff on it, etc. I'm just wondering if homes that are furnished draw in tenants who don't tend to stay that long? How much more can I get for a furnished home vs vacant home? Another 5% to 7% perhaps?

Renting a home that is furnished would certainly mitigate damage done to the house with move in/move out. No more dings in the walls from people moving in heavy furniture.

Josh Bowser · Answer

I think you'd be pleasantly surprised at what a furnished rental could potentially rent for. Plug in the town your property is in and get an idea of what other landlords are renting their properties for.

https://www.furnishedfinder.com/?utm_source=google&utm_m...

Keep in mind, these are typically shorter term leases. If you're going for a 6-12 month tenant, your premium to the longer term rate will come down.

Jeff Ba · Answer

What would lead you to believe that a 50% premium could be charged over normal long term rental rates, just for a furnished property? The rental rate might be $2,200. I doubt anyone would think $3,300 for a furnished place is a prudent price to pay. This is only for an 1,800 sf. one story ranch, not like it's a furnished 5,000 sq property.

Josh Bowser · Answer

Jeff - I don't think I'd worry too much about the looks of the furniture as long as it is fairly inline with today's style. Your tenant profile for a furnished rental is going to be different than if the tenant has to furnish the property. Typically, furnished rentals are for shorter term stays, so the tenant is most likely going to be able to deal with whatever your style is.

Should be able to command much higher rent depending on the area for a furnished rental - minimum of 50% more than LTR.

One option could be to lease the house and sell / lease the furniture in a separate bill of sale / contract. This could be a huge win for someone that is relocating to Atlanta and doesn't have / want to move their furniture with them.

Just my thoughts!

Jeff Ba · Answer

Yes. Instead of "moving" it, you just "leave it there" for the next person. For example a "sofa" and "TV" and "desk", etc. Rather than you "moving your stuff out" and someone then having to "move their stuff in", you just "leave" the furniture there and rent the place as "already furnished".

Henry T. · Answer

um, not having to move furniture?

Walter Bowser · Answer

From my experience, there have been more cons than than pros. The biggest pro, is typically you will have a higher rental rate, if your home is already furnished and you have no place or desire to store it, it might be worth it.

From my experience, it causes more headaches than anything. From furniture breaking and needing to be replaced, and it being a he said, she said on who was responsible for the damage. Unfortunately, I had to pay to replace the furniture during the lease because it was difficult to say for certain if it was normal wear & tear or damage caused by the tenant.

Chad Hale · Answer

The number of longer term renters looking for a furnished home is a much smaller pool of people.  Being furnished is also extra work, more things to break and be maintained. I will no longer manage furnished long term rentals.  Connecting with an insurance company may be helpful in placing long term tenants in a fully furnished home.

Doing STR is a completely different game.

Chaz Jenkins · Answer

The replies above answer your question in terms of furniture impact. I'll just add a local perspective: North Atlanta ie city, Sandy Springs, or Alpharetta? All have different perspectives in terms STRs and how your neighbors could potentially impact the experience. I imagine you're not in a HOA? People definitely want to be near the lake and some of the amenities if you're talking that part of North Metro ATL. The trade off course for STR route is more management/cleaning of guests coming and going/risk of no bookings vs not needing to deal with long term renters months at a time if that once they move in. In short consider the amount of hotels/STRs/major attractions near you.

Stephanie Walker · Answer

That depends on what type of landlord you want to be.

Furnished rentals will most often attract shorter term stays via AirBNB/VRBO/etc. weekend stays or midterm stays via insurance claimants, business travelers, etc. Owning/managing furnished rentals is a hospitality business. Is that something you are prepared for? The expectation here is more income, assuming that your property is in an area where furnished rentals are in demand. While we see year+ long furnished stays here in the Charlotte area, they are far and few between.

With that being said, the furniture, linens, appliances, etc. you provide/leave for guests matters. The more effort you put in to make your home stand out in a (maybe) already congested market, the higher the chances are that someone books your furnished rentals over others.

Kevin Sobilo · Answer

@Jeff Ba, I think you are on the edge of grasping the difference but haven't quite made the connection yet.

Furnished versus unfurnished are two VERY different things! They are going to attract COMPLETELY different kinds of tenants.

Typically a furnished rental will appeal to someone coming to live in an area for a short to mid term period of time. That could be a short term rental where people stay a couple nights at a time, someone coming to town for a work purpose for a few or several months at a time like a traveling nurse who signs a contract for several months.

If you want to be in the short or mid term rental business, I would go and try to learn about how to run those kinds of rentals because its a completely different kind of business than long term rentals.

For long term rentals, unfurnished will appeal to the VAST majority of tenants. They are looking to set up their "home". They already own furniture. They are living to their means. Unless they are on the poorer end renting furniture from Rent-a-Center they aren't likely wanting to pay to rent someone else's furniture.

So, I would say if you want to run a short or mid term rental, keep the furniture but if you want to do long term rentals nix the furniture.

Also, before you move forward make sure you have reasonable expectations for how things will go with having a tenant. Be prepared for all the difficult things that will happen.