My wife and I have a fully paid for SFH in the Tulsa area that's around 1750 sq ft and 3 bd 2.5 baths. We're currently getting around $1800 a month for a long term rental. Would it be worth it to consider fully furnishing the house on our next tenant? Generally speaking about how much extra rent could one expect per month if we did that? Pros and cons? We're in the furniture industry so we can outfit relatively easily. Thanks much!
Like @Kenneth Garrett said, you'll need to do furnished if you do STR or MTR.
If your intention is to continue LTR, furnishing the unit is a terrible idea as counter-intuitive as it seems.
Furnished units are appealing to college students of 22 year old's who do not have furniture (higher risk tenants).
Outside of that, renters have their own furniture. And if they don't...that's kind of a red flag. What do you mean you are 35 and don't have any furniture? People who love that a unit is furnished often don't show well in applicant screening.
In our experience, renting a LTR unit furnished means that it will take LONGER to rent.
Is there someone out there who is low risk, has a good reason for not having furniture of their own, and would pay an extra $100 for a furnished rental? Yes. Is it easy to find that renter? No. And by catering to that avatar, you are excluding every potential tenant that has their own furniture.
You need to determine if you are going to MTR or STR the property. Either way you will be furnishing the property. I'm going to presume you are thinking about MTR.
In general, MTR will generate 1.5-2.0 times the LTR amount. So theoretically, you could expect $2700-$3600. You should check out Furnished Finder and see what similar properties in your area are renting for and how they are furnished. You can do the same on Airbnb.
STR takes more work if you are going to self manage then MTR. MTR takes a little more work than LTR. You can also use Airbnb and VRBO for what others are charging in your area. Airdna is another sight that provides estimated revenue for your area. It can be fairly accurate as well as way off. Similar to using Zillow for the value of your house. At times it's pretty close while other times not so much.
I've use both MTR and STR with my properties in Florida.
Like @Kenneth Garrett said, you'll need to do furnished if you do STR or MTR.
If your intention is to continue LTR, furnishing the unit is a terrible idea as counter-intuitive as it seems.
Furnished units are appealing to college students of 22 year old's who do not have furniture (higher risk tenants).
Outside of that, renters have their own furniture. And if they don't...that's kind of a red flag. What do you mean you are 35 and don't have any furniture? People who love that a unit is furnished often don't show well in applicant screening.
In our experience, renting a LTR unit furnished means that it will take LONGER to rent.
Is there someone out there who is low risk, has a good reason for not having furniture of their own, and would pay an extra $100 for a furnished rental? Yes. Is it easy to find that renter? No. And by catering to that avatar, you are excluding every potential tenant that has their own furniture.
I personally would not recommend furnishing it. Most long term tenants already have their own furniture and prefer to use it. Furnished homes tend to see more wear and tear and it becomes one more thing to manage and replace.
In my experience, the extra rent rarely justifies the hassle. You also run the risk of items being damaged or disappearing when a tenant moves out, which turns into deposit disputes and extra admin work.
Furnished usually makes more sense for short term or mid term rentals, not traditional long term tenants. For an $1800 long term rental, I doubt you’d see enough premium to offset the cost and risk. Good luck & happy investing!