Maximize Your Rental Property Returns

Today's Financial News - Posted June 23, 2008

“The key isn’t so much putting in expensive furniture or 280-count sheets. It’s more about creating a comfortable environment with all the amenities a guest might like.” — Lief Simon

by Lief Simon

Baltimore — (TFN): I know two (elderly) American sisters who rent out their Paris apartment when out of town. Because they use it sometimes, they decorated it for themselves with high-end antique furniture, crystal glassware, linen tablecloths, and plenty of breakable knickknacks. While this gave them a comfortable apartment, it also limited the type of renter. No children, no pets, no singles…only couples who were put through a rigorous process before being allowed to book the apartment.

Furnishing an apartment for short-term rental can be a challenge. You have to balance the cost with comfort… practical with convenient… personal taste with neutral decoration.

The first thing you’ll have to decide is how much effort into screening guests you want to do. For a mid- to low-priced studio, you don’t have to think too much. But for a two-bedroom apartment in the best neighborhood—that you may need to use yourself—you’ll need to pay more attention.

The rigorous screening of guests that these American women undertook obviously affected their occupancy rate, but on the other hand, they could charge more than their neighbor’s similar-sized apartment, because their place attracted higher-end renters.

Many investors go to the opposite extreme. They furnish the apartment with the bare minimum to accommodate guests. Cheap furniture… limited kitchenware and appliances… inexpensive towels… no extras. They think that the less they spend, the more profit they’ll make. If you’re going for the backpacker crowd, this approach is fine, but to maximize your rental property returns, you should consider being somewhere in between personal posh and campground basics.

The key isn’t so much putting in expensive furniture or 280-count sheets. It’s more about creating a comfortable environment with all the amenities a guest might like. Read on to learn more.

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