Is it a good idea to rent out furnished?

Just wondering if it's a good idea renting out a place furnished? Just weighing up this idea for a place like Canberra - mainly because there's a lot of people that come to Canberra in transit - either students or people down for work.

How much extra rent would I be able to charge? Is it worth it? I'm just thinking it might be worth it cause all the furniture could be tax deductible and I'd just get cheap stuff from Ikea.

I would assume that it would put off some people who need a place to put their own furniture but will attract others who don't want to buy furniture so perhaps it would only work for a certain type of property (eg. units) or area.

Anyone got opinions / experiences they would like to share?

 

IMO depends on location and style of property. If in central areas close to CBD or Government hubs then I think it can work.

I've seen people charge 20-50% more for furnished. Keep in mind when any of your items break or fail you will need to replace or repair. More hands on, but likely able to squeeze out more money for it.

 

I rented out my city studio fully furnished.eg fridge , lounge , Double bed, chair, etc

Would i do it again?

I probaly would partly furnish it leaving the fridge out this time.
I paid $450 for that and it has broke twice because the way they treat it. And its not wirth paying a technician to come out

Just get cheap furniture even from the Salvo's because they are going to wreck it believe me people dont care

You can put a cheap lounge in with 2 chairs, maybe a small coffee table and TV table, bear in mind kids will be jumping up and down on the lounge so dont get a expensive one


In the kitchen a second hand dining table and a few chairs is ok
I wouldnt bither with a fridge though

Bedrooms up to you if you want to pay for beds just get cheap type but unless they have built in wardrobes you will need these as i cant see students buying all this.

Work out how much extra rent you can get per week though because at the end of the year you will be replacing or fixing some stuff eg matresses have coffee stains etc over them
My apartment was popular with students and travellers because they didnt want to buy all the furniture but if i was to do it all again i would get secindhand furniture BUT look fir furniture that will last !

Its not use making a extra $1500 a year in rent but replacing furniture every year.

 

The furniture cost will depend on the rent you are charging and the quality of the building.

You can't put in cheap furniture and also charge high rent. And be prepared to replace mattresses, no one wants to sleep on one with stains of unknown origin.

And one renting a top quality apartment in a good location will want good quality furniture.
Marg

 

I did it with an apartment found the rent increase went from approx $480 to $600/week.
It is a niche market so vacancy rates can be slightly higher and the lease periods shorter.
The depreciation is very high.. items costing a couple hundred can be depreciated the full amount in the first year, so the cash flow can be great. But watch depreciation can be a double edge sword.. when selling, it's reduced from your cost base so you can be hit with much higher cgt.