By the summer months of 2018, real estate journalists in major metropolitan areas began noticing that demand for furnished rental property was up. The phenomenon was not a fluke to particular geographic area, but present in cities across America, particularly those experiencing substantial growth or economic development.
What is driving this trend? And most importantly, is offering a furnished rental a strategy you may want to consider? Read on to learn more about the furnished rental market’s possibilities.
Why Furnished Rentals Are Growing in Popularity
When many of us think of furnished rentals, we imagine short-term rental scenarios. While Airbnb and vacation rentals must be furnished to be functional, there is also demand for furnished long-term rentals.
While corporate housing has long been a source of tenants for furnished rentals, figures from July of 2018 suggest corporate tenants are responsible for only 13% of the demand increase. Some of the tenants responsible for this spike in demand include:
- Millennials. These age group is less “tied down” and happy to rent rather than assume home ownership obligations. They also tend to marry later in life, meaning many are keen to live in apartments.
- Baby Boomers. One Freddie Mac study found that 5 million Boomers will be renting by 2020.
- Anyone in transition. Moving to a new city is often easier if you don’t have to take furniture with you. Young professionals who take new jobs also love the simplicity of moving into a furnished place.
How to Make Your Furnished Rental Appealing and Profitable
If you decide to offer a furnished rental, there are some tips you can follow to justify higher rents, ensure your home appeals to high-quality tenants, and otherwise raise profitability. Keep these things in mind when you are getting a furnished rental ready:
- Use high-end appliances and fixtures. This forces appreciation and keeps your property looking nice whether you have one tenant or cycle through several.
- Think about offering flexible leases. Many of the people looking for furnished rentals are in transition. That may mean empty-nesters, newly single people, or even those who have taken a new job or are simply new to the area. Offering options beyond the standard one-year lease may make your rental stand out. 3-9 month leases can also appeal to certain markets. A college or graduate student, for instance, may be drawn to a property that can be rented during the school semester–though they may choose to renew anyway.
- Consider using a specialized property management company. This is especially true if you will be using a short-term rental where repairs must be done quickly. Of course, if you have the experience and time, you may also manage the property yourself. Regardless of whether you outsource the job or not, you should expect higher costs in either money spent on help or your own time and effort.
- Set aside funds to defend your investment. Don’t forget to include asset protection in your budget.
Our asset protection professionals at Royal Legal Solutions can help you determine which tools will best defend your new and existing investments. The law favors the proactive, and in our experience it is best to take action long before you think a lawsuit is even a possibility. By the time you’re expecting a lawsuit, it may be too late. So don’t delay. Schedule your personalized asset protection consultation today.