HOME > BLOG > Investing > Furnished vs. unfurnished: A choice for investors

When it comes time to rent out your investment property, you will be faced with many decisions, one being whether to furnish the property or not. Here’s what to keep in mind.

There are many factors you need to consider if you are thinking about renting out your investment property fully furnished such as your target market, location and the demand for furnished properties. Furnished properties may be more appealing to single workers on an employment contract, university student and families on holidays. However, unfurnished properties may appeal more to families, couples and retirees. Furthermore, the location and size of the property will affect who your target market is as well. For example, single workers and university students will be more likely to choose a one bedroom apartment over a 4 bedroom, two storey house.

So what are the benefits and pitfalls of a furnished investment property?


  • Higher returns: Many investors prefer renting out furnished properties as they are able to charge a higher rent. As you will be offering something extra, you may be able to charge more than other unfurnished properties on the market. Tenants may be more willing to pay more for the convenience of a furnished house or unit.

    Shorter leases: A shorter term lease may not be seen as a pro by every investor, but it is a great option for those who also want to use the property as a holiday home. Short term leases also means you can inspect the property more regularly which can help keep it in better condition.

    Tax advantages: There are certain tax advantages you can claim, depending on the type of property you have e.g. apartment, detached house. But if you have a furnished property, you may also be able to claim depreciation on the furniture. Your accountant will be able to discuss your options with you.


  • Costs: Not only will you have to pay for all of the furniture up front, but you will also need to be prepared for ongoing maintenance. If a piece of furniture is damaged, it will need to repaired or replaced quickly. Most furnished properties will need to be updated or remodelled every 3-5 years.

    Smaller tenant pool: Many renters already have their own furniture and won’t want to pay to keep it in storage, so the number of potential tenants may be significantly smaller.

    Need to have everything: Before a tenant moves in, you need to be sure that the property is fully equipped. Whilst it may be easy to remember all of the main pieces of furniture, you may easily forget about the smaller items such as linen, vacuum cleaner etc.

Furnishing your investment property can possibly give you a better return; however, you need to make sure you factor in the extra costs to ensure it will be worth the extra effort.

  • Use a calculator to get an estimate of how much you can borrow.
    Try one here.

  • See if you qualify. To get a more accurate idea of how much you can borrow with State Custodians,
    click here.

  • Call our Lending Specialists and they can do the calculation for you over the phone plus answer any questions you have at the time. Talk to us on 13 72 62.