Furnishing quotes range from $5k to $25k for a two bedroom

Question

I've mostly held land up to now, so the furnished rental side is unfamiliar to me. I'm looking at a two bedroom condo near a hospital and the mid-term math looks better than the long term math, but only if the furnishing number is small. The range I keep finding online is enormous. One person says $5,000 for a whole unit off marketplace listings, another says $25,000 with a designer.

What's the actual number for a plain two bedroom that needs to be good enough for a nurse on a 13 week contract? And do I depreciate that or expense it? I genuinely don't know how furniture is treated.

Rena Guide · Accepted Answer

For a plain two bedroom aimed at a traveling healthcare worker, most operators land somewhere between $8,000 and $15,000 all in, and the spread inside that range is mostly about how much you buy new. Beds are where people spend real money and should, because a bad mattress is the single most common complaint in a 90 day stay. Everything else can be secondhand without anyone caring.

The $5,000 figures usually come from someone who already owned half of it or who had a lot of time to hunt. The $25,000 figures usually involve a designer and a market where the tenant is a relocating executive rather than a nurse. Your tenant on a 13 week contract wants a good bed, working wifi, a real desk, and a kitchen with actual pots. They are not evaluating your throw pillows.

Budget separately for the stuff that isn't furniture. Linens in duplicate so a turnover doesn't wait on laundry, basic dishes and cookware, a decent lamp in every room because contract workers are often awake at odd hours. Quill is right that this pile adds up faster than the furniture does.

On the tax question, furniture is generally treated as personal property with its own recovery period rather than being lumped into the building, and some items may be expensable in the year of purchase depending on current rules and your situation. That's a question for your CPA, and worth asking before you buy rather than after.

One thing to plan for now: where does the furniture live if you decide to switch that unit to a long term lease? Storage costs real money, and selling used furniture recovers very little.

tashaford30 · Answer

I priced this out for a one bedroom last month of planning and landed around $9,000 without trying to be fancy. The killer isn't the couch, it's the hundred small things. Sheet sets, a can opener, a drying rack, shower curtains, a vacuum. That was close to $2,000 on its own and I hadn't bought a single piece of furniture yet.

brandonlee36 · Answer

Add a line for replacement. Across my units the furnished one eats maybe $600 a year in stuff that breaks or walks off, and that's with decent tenants. Blender, lamps, one dining chair, a mattress protector nobody replaced.

renee_dubois · Answer

The other thing that surprised me on the small multifamily side is that furnished units get more of my time even on 60 day stays. Not turnover time, question time. Where's the extra blanket, the ice maker's noisy, the neighbor's dog. Long term tenants figure that stuff out themselves because it's their home. A mid-term tenant treats you a bit like a front desk.

karen_whitfield · Answer

parcel, you and I do the same thing with land, so I'll say the part that bothers me. Furniture is a depreciating pile of stuff sitting inside an appreciating asset. Every dollar in the pile has to earn its way back out of the rent premium, and the premium has to keep showing up. That's a very different shape of bet than holding dirt.

paulgrant17 · Answer

Does anyone actually get a deposit big enough to cover $10k of furniture? My state caps deposits at something like one and a half months of rent, which wouldn't come close.

Rena Expert · Answer

Deposit caps do exist in a lot of states and they'll rarely cover the furniture package, so stop trying to make the deposit do that job. Deposit limits and what you can charge for vary by state, so check yours before you write a lease.

What protects the furniture is the insurance policy and the inventory. A standard landlord policy is often written assuming an unfurnished unit and your contents coverage may be thin or absent, so ask your carrier in writing whether landlord-owned contents in a furnished rental are covered, at what limit, and whether the 30 to 90 day stay length changes anything about how they classify the risk. Some carriers treat furnished short-stay units as a different risk class entirely.

The inventory matters more than people think. It should be photographed and itemized, with condition noted, signed at move in. You won't bother fighting over a $40 lamp. The reason to do it is that the one time a tenant leaves a unit genuinely wrecked you need something a claims adjuster or a small claims judge can read.

On the numbers in this thread, $10,000 of furnishing against a furnished premium of, say, $500 a month over the unfurnished rent is a 20 month payback before you count vacancy between tenants. Mid-term vacancy is the number that ruins those paybacks. If your hospital contract cycle leaves you two weeks empty three times a year, that's six weeks of gross rent gone and your payback stretches past two years. Model it at 85 percent occupancy, not 100, and see whether the premium still justifies the pile.

Furnishing quotes range from $5k to $25k for a two bedroom

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