What Is Furnished Rental?
A furnished-rental includes furniture, appliances, kitchenware, linens, and often utilities. Short-term-rentals are almost always furnished—guests expect turnkey. Mid-term-rental and corporate-housing are typically furnished for relocating professionals and traveling workers. ADR and monthly rates command a premium over unfurnished—20–40% in many markets. STR management includes furniture maintenance and replacement. Tax: furniture depreciates over 5–7 years; cost-segregation can accelerate.
A furnished rental is a property rented with furniture, appliances, linens, and essential household items included—common for short-term-rentals, mid-term-rentals, and corporate-housing.
At a Glance
- What it is: Property rented with furniture, appliances, and essentials included.
- Why it matters: ADR premium; required for STR and corporate-housing.
- Key detail: Furniture depreciates 5–7 years; cost-segregation can help.
- Related: short-term-rental, mid-term-rental, corporate-housing.
- Watch for: Furniture wear and replacement—budget 2–5% of revenue annually.
How It Works
What's included. Furniture (beds, sofa, dining table, chairs), appliances (TV, microwave, coffee maker, full kitchen), linens (sheets, towels), kitchenware (pots, pans, dishes), and often basic toiletries. Utilities may be included—common for short-term-rental and corporate-housing.
STR requirement. Short-term-rental guests expect a turnkey experience. Unfurnished STRs don't work—guests aren't bringing furniture for a 3-night stay. Furnished-rental is the default for STR.
Mid-term and corporate. Mid-term-rental (30–90 days) and corporate-housing serve relocating executives, traveling nurses, and contractors. They want furnished—no moving furniture for a 2-month assignment. Premium over unfurnished: 20–40%.
Tax treatment. Furniture and fixtures depreciate over 5–7 years (vs 27.5 for building). Cost-segregation studies can reclassify building components and furnishings for accelerated depreciation. STR tax deductions include furniture depreciation.
Real-World Example
Nashville 2-bed STR. Rachel furnished for $12,000—IKEA + Wayfair mix. Beds, sofa, dining set, TV, kitchen essentials, linens. ADR: $175. Unfurnished equivalent (if it existed for STR) would be $0—STR must be furnished. She budgets $400/year for replacement (worn sofa cushion, broken lamp, stained linens). Year 3: she replaced the sofa—$800. Furnished-rental is a cost of STR.
Austin 1-bed, mid-term. David lists on Furnished Finder for traveling nurses. 30–90 day stays. Furnished: $2,400/month. Unfurnished in same building: $1,750. Premium: 37%. His furniture cost: $8,000. Payback: $650/month premium × 12 = $7,800/year. Pays back in ~12 months. Mid-term-rental furnished-rental premium justifies the furniture investment.
Denver corporate housing. Sarah targets relocating executives. 60–90 day stays. Furnished-rental with higher-end furniture—$4,200/month. Unfurnished: $2,800. Premium: 50%. Corporate-housing clients expect quality furnishings—her investment: $18,000. She depreciates over 7 years. ADR equivalent: $140/night for 30 days = $4,200.
Pros & Cons
- ADR and monthly rate premium—20–40% over unfurnished.
- Required for STR—guests expect turnkey.
- Mid-term-rental and corporate-housing demand it—relocators don't move furniture.
- Furniture depreciation over 5–7 years—tax benefit.
- Upfront cost—$8K–20K depending on size and quality.
- Wear and replacement—budget 2–5% of revenue annually.
- Styling matters—generic furniture can hurt guest-reviews.
Watch Out
- Execution risk: Cheap furniture wears fast—replacements add up. Invest in durable pieces for high-turnover STR.
- Modeling risk: Include furniture cost and replacement reserve in operating-expenses. Don't ignore it.
- Compliance risk: None—but STR regulation may require certain safety standards (e.g., mattress encasements).
Ask an Investor
The Takeaway
Furnished-rental is the standard for short-term-rental, mid-term-rental, and corporate-housing. It commands a 20–40% premium over unfurnished. Budget furniture cost and replacement reserve. Furniture depreciation over 5–7 years—cost-segregation can accelerate. STR management includes maintaining the furnishings.