How much rent for semi-furnished

[Puppeteer]

I have someone interested in renting my house semi-furnished for 6 months with an option for a further 6 months, but I don't know what to charge in rent.

He wants fridge, Microwave, table and chairs supplied, and I'm looking at eventually renting this fully furnished as a holiday rental. I'll have to buy all the furniture, but am happy to do so.

It suits me to semi-furnish it at this stage, but I don't know how much to charge or how to calculate.

Unfurnished I could probably get 250-270pw. As a holiday rental in peak, I could get $1400 pw and about $400 pw off peak.

For 6 months I was thinking around the $400 mark fully furnished, but as partially furnished?

The rental market seems to be very tight, and I can't find any other furnished houses in the town for comparison.

Anyone have any idea.

 

[Rixter]

I have someone interested in renting my house semi-furnished for 6 months with an option for a further 6 months, but I don't know what to charge in rent.

He wants fridge, Microwave, table and chairs supplied, and I'm looking at eventually renting this fully furnished as a holiday rental. I'll have to buy all the furniture, but am happy to do so.

It suits me to semi-furnish it at this stage, but I don't know how much to charge or how to calculate.

Unfurnished I could probably get 250-270pw. As a holiday rental in peak, I could get $1400 pw and about $400 pw off peak.

For 6 months I was thinking around the $400 mark fully furnished, but as partially furnished?

The rental market seems to be very tight, and I can't find any other furnished houses in the town for comparison.

Anyone have any idea.

Pup,
Is this in your new Busselton prop? Why not ring around a few PM's in the area as if your prospective tenant looking for a semi furnished place?

 

[Puppeteer]

Yeah, this is the busselton Property.

I've talked to the PM's down there. None of them will deal with any property with furniture in it, and none of them really have any idea. They have virtually nothing available for rent, and none of them have furnished properties on their books.

I've talked to the tourist information centre and also some of the managers of holiday rentals down there. If there are any furnished rentals then they are private, and I don't know what the going rate is.

As a holiday rental I know what I could get, but I wouldn't have the same security I do with a 6 month tenant. I'm thinking somewhere around $350 (and the potential tenant has indicated that he's looking around this price, though I may have to put in A/C (but was planning on that anyway).

At $350 pw, it's very nicely CF+, which I wasn't expecting.

 

[Rixter]

Yeah, this is the busselton Property.

I've talked to the PM's down there. None of them will deal with any property with furniture in it, and none of them really have any idea. They have virtually nothing available for rent, and none of them have furnished properties on their books.

I've talked to the tourist information centre and also some of the managers of holiday rentals down there. If there are any furnished rentals then they are private, and I don't know what the going rate is.

As a holiday rental I know what I could get, but I wouldn't have the same security I do with a 6 month tenant. I'm thinking somewhere around $350 (and the potential tenant has indicated that he's looking around this price, though I may have to put in A/C (but was planning on that anyway).

At $350 pw, it's very nicely CF+, which I wasn't expecting.

If youre happy with that then go for it.......its CF+ so is not costing you anything........gives you time to research then review in another 6 months....BTW can you share the purchase price &rates?

 

[Puppeteer]

Yeah, will do. I settle on the 14th of Nov, and will share all the details then.

 

[Glenn]

Hi Puppeteer,

When renting a property with furniture, I give the tenants the option of which items they want. The replacement cost of the individual items are totalled, then divided by 52 to give me a weekly figure to add to the unfurnished rental rate.

To me, I am happy to rent furnished or unfurnished....but I don't run a charity. If tenants want the furniture, they must pay the same from me that they would from somewhere like Radio Rentals. The hassles involved in locating the right furniture, organising delivery, installation and the ridding of all that cardboard are not insignificant. Added to this, what if they move out after six months and the next tenant has their own house full of furniture...what are you going to do with a house full of furniture?? Give it away?? Sell it?? Store it?? Either way, it will chew up more of your time and money. How will you resolve issues regarding damage to the furniture?? Do you know the difference between "fair wear and tear" and damage?? How much to hold from the bond??? What if the tenants do a runner with all your furniture - will the bond go anywhere near covering the cost of the furniture....will your wife nag the hell out of you if it all goes pear shaped???

I am not usually such a negative sod, but have rented property several times with furniture and have experienced some of the above issues. All of this would be compounded by you living several hours drive from the property.

Good hunting

Glenn

 

[redwing]

Great Post Glenn and words of warning to the wise..

Food for thought for me also..thanks

 

[Puppeteer]

Thanks Glenn, that was exactly what I was after.

 

[Glenn]

The vendors that sold us our last property have been investors for the last 30 years. We had them over for a bbq after settling on the property. One piece of advice that really stuck in my head was when the husband said, "we would have done just as (very) well over the last 30 years if we had just boarded up all the windows and doors of our properties and carried on with life like they never existed". What I took this to mean was that we should not try to get too "tricky" with the rental side of the business and over emphasise the income side of residential property investment. Anyone that has owned a house in the last 2 years in Perth would be able to confirm that the gains we have seen would probably pay our mortgages for the next 10 years should we refinance and park the cash in an offset account.

Glenn

 

[Puppeteer]

I do agree with that, but the rent certainly helps pay the loan repayments. Without the rent, I wouldn't be able to invest to the same degree I do.

I'm not so much trying to get tricky, as I have a potential tenant who is willing to pay good rent for some extra's. I have contingencies in place if I need to move the furniture out of the house in the future, and if I could recoup the capital in 12 months for the additional investment, then the risk is worth it for me.

I agree that if the tenant wants extra's then they will need to pay for it.

 

[Peter Parker]

One piece of advice that really stuck in my head was when the husband said, "we would have done just as (very) well over the last 30 years if we had just boarded up all the windows and doors of our properties and carried on with life like they never existed". What I took this to mean was that we should not try to get too "tricky" with the rental side of the business and over emphasise the income side of residential property investment.

Your vendors must have been on high job incomes to pay the shortfall or endured a lower than necessary standard of living if they chose the 'boarded up' option. The reduced serviceability due to the absence of rental income could also limit the capacity to buy more and get more growth.

If their strategy was pure growth and their income was high enough to service the payment, wouldn't buying vacant land have been better than houses (nothing to go wrong, no need to insure and higher historical growth)?

Although long-term they came out OK, a portfolio that has rental income to recoup most of its expenses should be much easier to hold than one that recovers none. Though most money made from property is capital growth, it contributes to the SANF factor if you can demonstrate that you will 'break even' (if only on paper) even where cap growth is sluggish (which is most of the cycle).

Peter