San Diego Property Management Blog

Will a Furnished Rental Make You More Money?

A lot of property owners want to know whether furnishing their rental will ultimately generate more income for them. As with most things concerning real estate, the answer is: it depends. While it may make sense to furnish your rental in some cases, it could be detrimental to your bottom line in others. Here are three important things to consider: 

  1. Short-term vacation rentals must be furnished to bring in more money. They also need to be located in the right area—ideally, close to the ocean or the bay, but a stellar water view works, too. Of course, this is all dependent on your community or HOA allowing vacation rentals. A lot of HOAs have regulations that only allow for a 30-day or six-month rental, but even in the absence of such restrictions, some neighborhoods are downright hostile toward the prospect of vacation rentals. Scope out all potential rules and regulations first, otherwise, your life could suddenly become a lot less pleasant.
  1. Long-term furnished rentals don’t bring in more money. The overwhelming majority of quality, long-term tenants will have a truckload of furnishings right behind them when they move in. If your property is already furnished, you preclude approx. 95% of potential quality tenants from renting your home. That means less demand for your property, which then amounts to less rent for you. It is possible that you could fetch the same rent as you would with an unfurnished long-term rental, but you certainly won’t fetch more rent.

“While it may make sense to furnish your rental in some cases, it could be downright detrimental to your bottom line in others.”

  1. More furnishings mean more liabilities to you. Let’s imagine your tenant has a rambunctious little kid who likes to jump up and down on his parent’s furnishings. While jumping, the kid slips, falls, and hurts himself. Would that liability be on you, the property owner? No, of course not—their kid, their furniture.

What if, however, the legs or frame of the furniture you put in collapse, causing the kid to slip and fall? Then you have the “L” word – Liability! To avoid liability, you’ll need to do your part to maintain your furniture. (When that one- or two-year lease term is up, I guarantee you won’t be happy with the furniture condition). My advice: You already have enough regular maintenance issues to worry about; there’s no need to complicate matters by throwing furniture into the mix. 

I hope this message was helpful to you. Please feel free to call or email me if you want to discuss furnished rentals or any other property management topic further. I’d be happy to speak with you.