Renting your property out furnished or unfurnished: which is right for you?

Whether you're a first-time landlord or a seasoned pro, there's a decision to be made every time a new tenant moves in: will you rent out your property furnished or unfurnished? There are pros and cons to both options - and the best course of action will depend on what type of tenant you're hoping to attract and what your long-term goals are. With decades of experience in property rentals, Jawitz Properties has the breakdown of everything you need to consider.

The ins and outs of furnished rentals

The first thing to understand about furnished rentals is the type of people who are typically looking for them. Families looking for long-term homes likely have their own furniture, and thus won't be looking for a furnished home. However, there are a few groups of people for whom furnished rentals are invaluable. Students and young professionals who are just starting out won't have invested in much furniture yet and will find furnished rentals exceptionally useful. Similarly, those who have recently gone through a life-changing event may find themselves in need of furnished accommodation.

Another situation in which people look for furnished rentals is when they move to a new city and their furniture hasn't arrived yet. People in this situation may be interested in short-term leases while they look for their dream home. Digital nomads taking advantage of all that South Africa (and particularly Cape Town) has to offer are also likely to look for furnished rentals.

As a result, furnished properties tend to see a higher turnover of tenants. This comes hand in hand with a higher risk of vacancy periods. On the flip side, it's worth noting that furnished rentals can fetch higher rates than their unfurnished counterparts - and the difference is often 15 to 20%.

Renting out your home with furniture comes with higher rewards, but also potentially with higher risks. Many of these risks can be mitigated by making sure that a tenant is screened carefully and that you have appropriate insurance policies.

Advantages of renting your property out furnished

• You'll have the opportunity to charge a higher monthly rent than you would if your property were unfurnished.
• You have the potential to offer short-term leases if that appeals to you.

Disadvantages of renting your property out furnished

• There is typically lower demand for furnished properties than unfurnished ones.
• You may have more vacancy periods between tenants, especially if you focus on short-term leases.
• You run the risk of damage or loss of the contents of the property, which may require repair or replacement.
• Regular maintenance of appliances will be an additional expense.

Everything you need to know about unfurnished rentals

In most cases, the types of people looking for unfurnished rentals include families and individuals who are settled and looking for long-term accommodation. There is typically a higher demand for unfurnished rentals than furnished ones, which could mean fewer vacant periods for you.

While rental rates on unfurnished properties may be slightly lower, there's a lower overall risk, and that appeals to many landlords. If you're renting your property out unfurnished, your tenant is likely to be looking for a long-term home, which means a stable income for you - and another bonus is that you don't need to be concerned about how tenants treat your furniture. Once you find a great tenant, you're likely to have them living in your property for at least a year.

Advantages of renting out your property unfurnished

• Your property is likely to appeal to families looking for a medium to long-term home, which creates stability with annual escalations in rental.
• You are likely to have fewer vacancy periods than if your rental property were furnished.

Disadvantages of renting your property out furnished

• Your property could command a lower monthly rent than it would if it were furnished.
• Your property will not appeal to the likes of digital nomads.

Furnished or unfurnished, what truly matters is receiving the right guidance and finding the right tenant for you and your rental property! The Jawitz Properties rentals team has decades of experience in helping landlords find and vet the right tenants, as well as actively manage long-term relationships. For help in renting out your property, get in touch today.