I am planning on putting furniture in a property in Cairns . The furniture will cost $10000 and i can get another $30per week rent – what do you think of the idea- as anyone had problems renting out furnished accommodation?
Liz2005
Hi Liz,
We have a furnished place and furnished it thru Salvo’s or Op shops a lot more cheaply than 10000
. Bear in mind that the return on investment is better being 20/week on 4000 than 30/week on 10000 and believe me the tenant probably will not care $6000 worth.
I believe it has reaped some rewards for us in a flat situation and /but the flat next door, we have been told not to furnish because tenants have said they do not prefer it furnished.
Houses, we have been told not to worry because tenants moving into a house usually have their own . General rule seems to be that a “furnished” tenant may not be a long term tenant. However, in the end it will come down to your P.M. advice or your feeling of the need .Cheers for now Len
Hi Liz,
I have a couple of IP’s in Cairns area, furnished and unfurnished. camder is right, you do not have to spend heaps (although it does depend on the type of unit, mine are not waterfronts). I’ve been lucky that the tenant in the furnished one in a keeper, he looks after the place, has repainted at his own expense etc.
Where I have found the benefit is in with depreciation, as all my furnishings fall into the Low Pool category. I.e I can get a better return now and I can claim the bulk of the depreciation in the first couple of years. 18.75% year 1 and 37.5% of balance in subsequent years.
Thus the depreciation benefit can outweigh the rent benefit.Say $5000 in furniture.
Interest on this to borrow at 7% = $350
extra rent = $15 week or $780 year
Depreciation year 1 = $938
Depreciation Year 2 = $1524
Depreciation Year 3 = $952 , 4= $595 ,5 = $372If it’s goint to be fully furnished, you need to think of everthing. Kitckenware, wall hangings, maybe a bookcase etc. It has to feel like a home.
Worth thinking about.
Mal
Getting out of your comfort zone, can help you become comfortable
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