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08-08-2011, 04:35 PM #1
Rent to individuals or rent as furnished corp. apt.
I am in the process of buying two condo / apts. and would like feedback from others. I am trying to decide between traditional leasing to individuals or as furnished, all bills paid, corporate housing. Other similar units in the complex are leasing for around $700/month (12 month lease) to individuals. I'll be in them for about $250 a month. Fully furnished / all bills paid corp units of similar size go for around $1750-2k. on short term leases. My profits on that would be about $200/mo higher, but with the added risk of short term leases, and gaps between tenants. Thoughts from those who have been there?Madness takes a toll. Please have exact change...
08-08-2011, 07:13 PM #2Senior Member
- Join Date
- Mar 2011
- Northern, IL
steady cash flow will beat the short term gains,
unless you have the cash to cover the gaps , then the stable income would be preferred in my opinion.
08-08-2011, 07:22 PM #3
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08-08-2011, 08:28 PM #4
09-12-2011, 04:36 PM #5Member
- Join Date
- Mar 2011
Depending if you do the management yourself or get a property manager, you should weigh the cost of management as well. More tenants = more headaches. One the flip side, long term tenant who doesn't pay rent can be an even bigger headache.
09-12-2011, 05:44 PM #6
wear and tear is much higher when there is a high turnover. that's more than $200/mo alone. add management cost and downtime, you are better off doing a 1 year lease. quite frankly, condos are the worst investment properties. you pay association fees, special assessments and deal with high turnover.
get a townhouse or 3-4 BR house if you can. family tentants are more stable and will take better care of it.
10-12-2011, 03:12 PM #7
I agree that long term stable leases are much better however today its actually not very difficult to lease corporate units to a corporate housing companies or directly to companies if you can properly market the place.
When companies look at the cost advantage of corporate units compared to hotels these corporate units far outweigh a hotel in benefits and overall cost.
There are actually furniture rental companies now that have divisions that specially cater to corporate apartments and provide everything from small counter top appliances down to dinner wear and towels. A one stop shop if you will for everything a corporate apartment would ever need.
then simply contract a maid service to service the unit, figure in the price for the rental items and cleaning service and add you other costs and presto. Every year simply contact the furnishing rental company and they will come exchange all the furnishings and replace them with new ones that are updated.
to get you started check out Swingles furniture rental as they have locations all over the USA and they have a division that caters solely to corporate apartments.
if you plan right and play your cards right you can rent your unit for a year or two lease to a corporate housing company or directly to a company, then if you don't have a least the furniture rental company can bring out a truck and pick up all the items in one day and then you are free to rent it to individuals.