It used to be that the only way to rent a house was empty and unfurnished. Nowadays, more and more houses are available for rent fully furnished. However, renting a furnished house comes with it's own set of considerations. Of course, the ways you attract and screen a tenant are the same, but that's where the similarity ends. Some things to keep in mind when you're considering getting into furnished rentals are as follows:
1. A rental property that comes furnished can get 25% to 50% more than an unfurnished property, which is a significant advantage in areas like Vancouver where you might have a difficult time making a profit each month from your rental property. However, even though your rent is higher, your costs for a furnished property are higher as well. It costs at least $10,000 to furnish the property, as well as the cost each month for all utilities (water, hydro, gas, phone, cable, Internet, security, etc.). Today's furnished rentals also often come with cleaning services, which are paid for by the landlord.
2. Fully furnished means that someone only needs to arrive with their suitcase. You are providing everything someone would need to live in your home like:
- all cookware, dishes, glasses and utensils,
- appliances like blenders, coffee makers, food processors,
- towels and bed linens,
- brooms, dust pans, vacuums and other cleaning supplies,
- amenities like television (with cable service) and wireless internet are pretty standard. Basically if a hotel suite would have it, your rental unit should too!
3. Remember that different people have different needs. Oftentimes, you'll need to provide things you hadn't anticipated, such as a crib, highchair, or a special computer desk. Desks are especially important since more and more people are working from home these days. Keep in mind that you could rent the extra items from furniture rental companies rather than buying them.
4. Remember that although you own the property, it is not your home. It's not the place for your family heirlooms or pictures of your family. If you have any of these in the house, remove them before the new tenants arrive.
5. Create a detailed checklist of what is in the property in preparation for the tenant walk through. Go from room to room, ensuring you note ALL details. In the kitchen, record all appliances and count the number of glasses, plates, mugs etc. that you are providing for the new tenants. Record the number of towels, pieces of furniture and paintings and their condition. If something is broken or stolen you will need a record of what was there in order to use their deposit to buy a replacement. You'll want your tenant to sign this when they move in, and then you'll want to do a detailed inventory of everything again when they move out.
6. Buy extra boxes of breakable items. i.e. an extra box of plates, an extra box of mugs and glasses. If it can break easily, be prepared to replace it easily!! It's a good idea to furnish your unit with items from stores that are inexpensive and will always have a large inventory of the same pattern i.e. Ikea, so that you can ensure that you will always have matching sets.
I wanted to share these lessons learned with you in case you are thinking of renting a furnished property as a way to bring in more cash from your rental. It is definitely a great way to make some extra cash off your home if you'll be away for awhile, or to capitalize on the upcoming Vancouver Winter Olympics. Just remember that it's not without some challenges.
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