Have you ever considered renting out a fully furnished property? It’s not an option that many people think of when they are first starting out in building an investment property portfolio in Australia. However it can be a good choice if you want to maximise your weekly or monthly income, as well as appeal to a specific rental market.
So what are some of the benefits to offering fully furnished property? One of the first things you’ll notice when you browse through property listings is that fully furnished apartments tend to ask higher rents per week than the equivalent unfurnished properties. While the amounts can vary based on location and how new the building is, many furnished apartments can rent for up to 30 per cent more per week, with short term holiday properties even higher during peak periods. Of course keep in mind that many brand new apartment developments will not allow these type of short term rentals based on the zoning or strata laws, so it is important to check the regulations before considering this option.
There are some important points to consider if you are considering making your investment property in Australia a furnished rental. These include:
- “Fully furnished” can mean different things in different locations and even in different states. Generally speaking, the term means that someone would be able to move in straight away, although they may need to bring items such as bed linen and kitchen appliances. Short term holiday rentals generally should include everything from linen and towels to can openers and tea towels. If you really want to be sure that your property will be appealing to the market you can always check other listings in your area or even visit one on open inspection day to see what they include. Property agents and investment experts will also be able to give you an indication of what you should purchase.
- When choosing furniture and other inclusions you should always try to appeal to the broadest possible market. For example, you don’t want to indulge in your love of the colour purple only to find that potential renters are put off by your style when they come to view the property. Choosing light colours such as creams and greys, and furniture that is simple but stylish is your best bet to attracting the widest possible demographic for your property.
- Additionally when you have an investment property in Australia, while you probably don’t want to spend large amounts of furniture and accessories you will want to ensure that it is easy to keep clean and will not date after a few years.
- According to the Australian Tax Office you may also be able to claim a “decline in value” from any furniture and appliances in your property over a number of years. As with any financial information you should always check with a professional before making decisions.
The other thing you’ll notice when looking at listings for fully furnished properties is that they are more popular in certain inner city and CBD locations. This is because the demand for such apartments generally comes from corporate professionals, contractors or people moving to the city. This market wants to be close to the city and transport hubs, and are more likely to pay more every week for a property if they feel it is convenient and hassle-free. Investment property experts such as Ironfish will be able to assist you in creating the right strategy for you in relation to a furnished rental property to maximise your investment.