Furnished vs. Unfurnished Rentals: Which Earns More?

Furnished rentals charge higher rent. But they also cost more to set up, maintain, and turn over. So which strategy actually puts more money in your pocket?

The short answer: furnished rentals earn more gross income in most markets, but unfurnished rentals are simpler and sometimes more profitable after expenses. The right choice depends on your market, property type, and how hands-on you want to be.

Here's the full breakdown.

The Income Gap: Furnished vs. Unfurnished

Furnished rentals typically command a 20–50% premium over comparable unfurnished units. In high-demand markets, that gap widens further.

Real-world examples (2025–2026 data):

Market	Unfurnished 1BR	Furnished 1BR	Premium
Austin, TX	$1,400	$2,100	50%
Nashville, TN	$1,350	$1,900	41%
Denver, CO	$1,550	$2,200	42%
Charlotte, NC	$1,200	$1,650	38%
Phoenix, AZ	$1,300	$1,750	35%
Midwest (avg)	$900	$1,150	28%

These premiums hold strongest for [midterm rentals](/blog/dscr-loan-midterm-rental) (30–90 days) and in markets with large populations of traveling professionals — especially near hospitals, military bases, and corporate campuses.

What It Costs to Furnish a Rental

You don't need designer furniture. Functional, durable, and clean is what tenants want. Here's what a reasonable furnished 1-bedroom setup costs:

Essential furniture:

Bed frame + mattress: $400–700
Sofa: $300–600
Dining table + chairs: $200–400
Dresser: $150–300
Desk + chair: $150–300
Nightstands (2): $100–200
TV + mount: $200–400
Coffee table: $75–150

Kitchen essentials:

Cookware set: $50–100
Dishes, glasses, utensils: $50–100
Small appliances (coffee maker, toaster): $50–80

Linens and basics:

Bedding sets (2): $80–150
Towel sets: $40–80
Curtains: $50–100
Bathroom accessories: $30–50

Total for a 1-bedroom: $1,900–3,600 Total for a 2-bedroom: $3,000–5,500

Buy from IKEA, Wayfair, Facebook Marketplace, or liquidation sales. Avoid anything white (stains), glass (breaks), or overly trendy (dates fast). Gray upholstery, wood-tone furniture, and neutral bedding photograph well and last.

The Real Math: Furnished vs. Unfurnished Profitability

Let's run the numbers on a 1-bedroom apartment in a mid-size city.

Unfurnished Scenario

Monthly rent: $1,400
Annual gross: $16,800
Average vacancy: 1 month/year
Turnover cost: $500 (cleaning, minor repairs)
Net annual income: $15,100

Furnished Scenario

Monthly rent: $1,950 (39% premium)
Annual gross: $23,400
Average vacancy: 1.5 months/year (more turnover)
Turnover cost: $800/turn × 2 turns/year = $1,600
Furniture depreciation: $600/year (replacing items over 5 years)
Net annual income: $18,275

Difference: $3,175/year more with furnished. That's a 21% increase in net income.

But notice: the furnished scenario involves more work. More turnovers, more cleaning, more inventory management. If you value your time at $50/hour and each turnover takes 8 hours of your time, that's another $800/year in labor.

Still profitable — but the gap narrows.

Who Rents Furnished Apartments?

Understanding your tenant pool matters. Furnished units attract different renters than unfurnished ones:

Travel nurses and healthcare workers

Typical stay: 8–13 weeks
Housing stipend: $1,800–3,500/month depending on city
They need move-in ready units with everything included
This is the largest and most reliable furnished rental market

Corporate relocators

Typical stay: 1–6 months
Companies often pay directly, meaning reliable income
They expect a higher standard — clean, well-equipped, professional

Insurance/disaster housing

Typical stay: 1–6 months
Insurance companies pay market rate or above
Tenants need immediate availability

Remote workers and digital nomads

Typical stay: 1–3 months
Price-sensitive but growing demographic
Strong WiFi and a good desk matter more than a fancy couch

Students and interns

Typical stay: 3–6 months
Lower budget but consistent demand in college towns
Expect more wear and tear

Divorce/transition housing

Typical stay: 1–6 months
Often need immediate availability
Willing to pay a premium for convenience

When Furnished Makes Sense

Furnished rentals perform best when:

You're near a hospital or medical center. [Travel nurse housing](/blog/corporate-housing-rental-guide) is the backbone of the furnished rental market. Hospitals in cities like Austin, Nashville, Phoenix, and San Diego have constant demand.
Your market has high short/midterm demand. Check Furnished Finder, Airbnb (30+ day filter), and [corporate housing](/blog/dscr-loan-corporate-housing) sites to gauge demand.
You have a 1-bedroom or studio. Smaller units are cheaper to furnish and attract the most midterm tenants. Furnishing a 3-bedroom family home rarely makes financial sense.
You're already doing midterm rentals. If you're targeting 30–90 day stays, tenants expect furnished units. It's not optional — it's the baseline.
You can handle more turnover. Furnished rentals turn over 2–4 times per year instead of once. If you're local and organized, this is manageable. If you're remote, you'll need a system or property manager.

When Unfurnished Is the Better Play

Stick with unfurnished when:

You want [passive income](/blog/real-estate-vs-stocks-2026). A good long-term tenant who pays on time and stays 3+ years is the lowest-effort income source in real estate. Furnished rentals are more active.
Your market is suburban/family-oriented. Families bring their own furniture. They want 3-bedroom houses with yards, not furnished apartments.
You're far from the property. Managing furniture inventory, handling turnovers, and dealing with damage claims is harder from a distance.
Local regulations are unfavorable. Some cities have stricter rules for short-term and midterm furnished rentals. Check local ordinances before investing.
You have a high-value property. Expensive furnishings in a luxury property mean expensive replacements. The premium percentage is often lower on high-end units.

Hybrid Approach: Partially Furnished

You don't have to go all-or-nothing. Partially furnished units offer a middle ground:

What "partially furnished" means:

Major furniture only (bed, sofa, dining table, desk)
No kitchen supplies, linens, or small items
Tenant brings personal items and fills in gaps

Why it works:

Lower furnishing cost ($1,200–2,000 for a 1-bedroom)
Still commands a 15–25% premium
Less inventory to manage and replace
Appeals to a broader tenant pool

This works especially well for units targeting young professionals and relocators who don't want to buy big furniture but have their own kitchenware and linens.

Furniture That Lasts: What to Buy

The biggest cost killer in furnished rentals is replacing furniture. Buy durable from the start:

Buy:

Performance fabric sofas (stain-resistant, like Revolution or Crypton fabric)
Metal bed frames (no particle board)
Solid wood or laminate dining tables
Commercial-grade mattresses with waterproof protectors
Blackout curtains (tenants love them, they last years)

Avoid:

White or light-colored upholstery
Glass tables or shelving
Particle board furniture (IKEA basics fall apart in 1–2 years)
Expensive art or decor (tenants don't care, and it gets damaged)
Memory foam mattresses without protectors (they absorb everything)

Pro tip: Buy 2 sets of all linens and towels. When a tenant moves out, swap in the clean set immediately. Wash and store the used set for next time. This cuts turnover time by a day.

Tax Implications

Furnished and unfurnished rentals are taxed differently:

Furniture depreciation: The IRS lets you depreciate furniture over 5–7 years (depending on the item). A $3,000 furniture package gives you $430–600/year in depreciation deductions.

[Bonus depreciation](/blog/depreciation-rental-property-guide): Through 2026, you may be able to deduct a significant portion of furniture costs in the first year. Consult a tax professional for current rates.

Higher gross income = higher taxes: The extra rental income is taxable. But after depreciation deductions, the effective tax impact is usually modest.

Short-term rental classification: If average stays drop below 7 days, or below 30 days without substantial services, you may face different tax treatment. Midterm (30+ days) avoids most of these complications.

How to List a Furnished Rental

Furnished units should be marketed differently:

Platforms for furnished rentals:

Furnished Finder (the go-to for travel nurses)
Airbnb (30+ day setting)
VRBO (monthly rentals)
Facebook Marketplace
Zillow (filter: furnished)
Corporate housing sites (BridgeStreet, Oakwood)
Local hospital Facebook groups

Listing tips:

Lead with "fully furnished, move-in ready" in the title
List every included item — tenants want to know exactly what's provided
Photograph every room, including closets and kitchen cabinets
Mention WiFi speed (travel nurses care about this)
State the minimum stay clearly
Include all utilities in the price if possible — simplicity sells

Managing Furnished Rental Turnovers

The turnover process for furnished units is more involved than unfurnished:

Turnover checklist:

Walk-through inspection with outgoing tenant (photograph everything)
Deep clean (budget $150–300 for professional cleaning)
Inventory check — compare to your master list
Replace damaged or worn items
Swap linens and towels
Test all appliances and electronics
Reset WiFi password
Restock consumables (toilet paper, soap, trash bags for first week)
Professional photos if anything changed

Target turnover time: 2–3 days between tenants.

Build the cleaning and turnover cost into your pricing. If you charge $1,950/month and spend $300 on turnover every 3 months, that's effectively $100/month — still well above unfurnished income.

FAQs

How much more can I charge for a furnished rental?

Expect a 20–50% premium over unfurnished rent in the same area. The premium is highest in markets with travel healthcare workers and in urban areas with strong midterm rental demand. In slower markets, expect 15–25%.

Is it worth furnishing a rental property if I only have one unit?

Yes, if your market supports it. One furnished unit near a hospital can earn $3,000–6,000 more per year than the same unit unfurnished. The furniture investment ($2,000–4,000) pays for itself in 4–10 months.

What if tenants damage my furniture?

Charge a security deposit that covers furniture replacement (typically $500–1,000 above a standard deposit). Document everything with photos at move-in and move-out. Budget 10–15% of furniture value annually for replacements.

Can I convert an existing unfurnished rental to furnished?

Yes. Wait until the current lease ends, furnish the unit, then market it as furnished at the higher rate. The best time to switch is when you'd have a vacancy anyway.

Do furnished rentals have higher insurance costs?

Yes, slightly. Your landlord policy should cover the furniture, which may increase premiums by $100–300/year. Make sure your policy explicitly covers furnished rental contents. The extra income far exceeds the insurance cost.

Should I include utilities in furnished rental pricing?

For midterm rentals (30–90 days), yes. Bundling utilities simplifies the tenant experience and justifies a higher total price. Budget $150–250/month for utilities and build it into your rate. For long-term furnished leases (6+ months), separate utilities are more common.

At HonestCasa, we help landlords make data-driven decisions about their rental properties. Whether you choose furnished or unfurnished, the right strategy depends on your specific market and goals.

[[Rental [Property Depreciation](/blog/rental-property-tax-deductions)](/blog/depreciation-real-estate-guide) Guide: How to Maximize Your Tax Deductions in 2026](/blog/depreciation-rental-property-guide)
[Best College Towns for [Rental Property Investment](/blog/best-states-for-rental-property-investment-2026)](/blog/best-college-towns-for-rental)
How to Identify the Best Neighborhoods for Rental Property Investment (Data-Driven Approach)

Furnished Vs Unfurnished Rental

Key Takeaways