Most builders often develop bare-shell apartments and hand it over to their occupants. The buyers, based on their needs and budget, either choose to start living in these or rent it out to prospective tenants. Consequently, newly-developed residential destinations, generally have a healthy mix of ready-to-move-in residential apartments, for those seeking rental accommodation. Based on the amenities available, these apartments are generally categorised as ‘fully furnished’, ‘furnished’ or ‘semi-furnished’.
This category of housing is very similar to bare-shell apartments, with minimum basic amenities such as lights and fans. These apartments may or may not have a shelf or cupboard in all its rooms.
A furnished apartment
The term can be confusing at times. This is not a definitive term and does not bind an owner to provide the exact number of amenities to his tenant. Most often, this term means that the apartment will have cupboards and shelves, cabinets, a modular kitchen and lights and fans. If you are looking for something more, you should negotiate with your landlord. If he is willing to put an air-conditioning system within the same cost, consider yourself lucky.
A fully-furnished apartment, however, may have all of the above, including air-conditioning and water heaters in the bathrooms. In addition to these, if the apartment is a serviced apartment, it will be run like a hotel, with the assistance of a facility management team. A serviced apartment will have all kinds of amenities in the rooms – the kitchen will stocked with grocery and regular kitchenware including a refrigerator and microwave oven, the rooms will have bed linen and extra towels and the apartment will also have a telephone connection.
In India’s rental market though, serviced apartment projects are few. In the rental market, home owners generally limit themselves to providing a ‘furnished’ apartment. Suraj Kumar, a Noida-based broker, says, “A fully-furnished apartment is difficult to find in our cities. Only serviced apartments provide that kind of services. Largely, you will only find furnished apartments, with limitations and the tenant will have to make provisions for other important things.”
Difference between various categories of furnished apartments
While there is visible difference in these three categories, the apartments also differ in rental rates. In general, there is a difference of around 10%-15% in rental values, between a bare-shell apartment and a furnished apartment. On the other hand, the rental rate of a fully-furnished apartment or a serviced apartment may be many times higher.
Manish Mishra, a facility manager with a large company and based out of Jaipur, explains that “The rental rate of a serviced apartment or a fully-furnished apartment, may be on the higher side and is often meant for people with deep pockets or business travellers. The demand for such units mostly comes from foreign tourists who wish to reside here for medium to long term.” Often a fully-furnished apartment is customised on demand and as per the request of the tenant.
Which type of apartment should you opt for?
If you are a landlord, the idea of a furnished apartment makes sense, if you wish to earn more as rental income.
The cost of furnishing the apartment, can be recovered within a period of 1 to 1.5 years. “Chances are that if you get a decent tenant, who keeps your apartment clean and cares for the belongings and furnishings, there will be minimum requirement for maintenance once he leaves. This way you can earn and save,” Kumar points out.
From the tenant’s perspective, a furnished apartment makes sense, if one has moved to a city only for a short period. Students can also look for such apartments.
The extra cost of Rs 2,000-5,000 per month on furnishings, will at least take care of the basic amenities. Nevertheless, the choice is subjective and depends on one’s needs.