Advantages of furnished rental: simplicity and flexibility

The furnished rental attracts more and more owners and tenants. This formula offers many advantages, both financial and practical. As a specialist in real estate law, I invite you to discover the multiple facets of this rental mode which is gaining popularity.

An advantageous tax framework for owners

One of the main assets of the furnished rental lies in its attractive taxation. I remember a customer who hesitated between naked and furnished rental. After explaining the tax advantages to him, he opted for the latter and never regretted it!

Here are the main tax advantages of furnished rental:

• Taxation in the category of industrial and commercial profits (BIC)
• Choice between two tax regimes: micro-BIC or real
• 50% fixed reduction on rental revenues in micro-BIC regime
• Possibility of deducting the real charges and the depreciation of the property in real regime
• Tax deficit made over 10 years

The micro-BIC regime is particularly interesting for small rental income, while the actual regime is more suitable for more substantial investments. In some cases, it is even possible to recover VAT on the purchase of the property or the work carried out.

Partial exemption from added value

Another significant tax advantage is the partial exemption from the added value when the property resumes. This provision can be very interesting if you plan to resell your property in the medium or long term.

The particular case of tourist furnishings

If you opt for the rental of classified tourist furnishings, the flat-rate reduction in micro-BIC regimpted 71%. This is an opportunity not to be overlooked for owners located in tourist areas.

Increased flexibility for rental management

Flexibility of management is a major asset of furnished rental. It offers greater freedom to owners and tenants. Here are the main advantages in terms of flexibility:

This flexibility makes it easier to adapt to the needs of tenants, especially students and young workers. I have often found that this formula is perfectly suited to people in professional mobility or life transition.

Mobility lease: an interesting innovation

The mobility lease, lasting 1 to 10 months, is a novelty which further strengthens the flexibility of furnished rental. It is aimed at a specific audience (students, trainees, people in vocational training) and offers great flexibility.

The frequent revaluation of rents

The more frequent rotation of tenants makes it possible to regularly reassess the rents. This is a significant advantage in a context of dynamic inflation or real estate market.

Attractive profitability for investors

The furnished rental Generally offers better profitability than empty rental. Rents are on average 10 to 30% higher, which results in profitability between 6 and 8%, against 4.7 to 6.6% for empty rental.

This higher profitability is explained by several factors:

1. Higher rents
2. Strong rental demand, especially in major cities
3. Tax advantages that improve net return
4. The possibility of renting to specific audiences (students, expatriates)

I have accompanied many investors in their furnished rental projects, and most are satisfied with their choice. However, it is essential to note that this increased profitability is accompanied by sometimes more complex management.

The particular case of service residences

Service residences (students, seniors, tourism) offer specific advantages in terms of management and profitability. Rental management is delegated to a professional, rents are secured by a commercial lease, and visibility on rental income is increased.

The importance of good management

To optimize profitability, rigorous management is necessary. This implies regular monitoring of the condition of furniture and equipment, reactivity in the event of a problem, and a good knowledge of the local market to adjust rents.

The challenges to be met for furnished rental

Despite its many advantages, the furnished rental also has some challenges to be met. Being a professional in real estate law, I must present them to you:

First of all, the initial investment is more important. You must provide the purchase of furniture and equipment, which can represent a substantial budget. In addition, these elements wear out more quickly and require regular maintenance.

Management can be more complex, especially due to:

• The need to carry out a detailed inventory with each change of tenant
• Management of problems related to equipment provided
• A more frequent rotation of tenants, involving more administrative procedures

Finally, the target audience can be more limited than for an empty rental, especially in certain geographic areas. It is therefore crucial to study the local market well before starting.

Despite these challenges, my experience showed me that most owners who opt for furnished rental are satisfied. The key lies in good preparation and rigorous management.

Finally, the furnished rental offers many advantages, both fiscal and financial and practical. It meets an increasing demand for flexibility and can be very profitable for wise investors. On the other hand, it is important to weigh the pros and cons before getting started, taking into account its personal situation and the local market.