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A better opportunity at a lower cost

  • Published at 11:17 pm December 23rd, 2019
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Do furnished apartments really cost more than non-furnished ones

A home only becomes a “home” when it becomes filled with memories and affection, although, having a comfortable bed to sleep in, a couch to relax on, and a refrigerator to eat from can go a long way in making the place feel more like home. So consider the following – you are about to move into a new city from your hometown for work or study and you need to either buy new furniture for the house or bring along your existing furniture to the new place. These options can be quite expensive or very inconvenient or both. After all, a home requires a lot of items to make it comfortable and livable.

So, what if you had the option of moving to a completely new place without having to take or buy any of the major furniture, yet, have all the necessary items present in your new home? That is what furnished apartments offer. This type of housing, no doubt, has plenty of merits – however, the prevailing perception in Bangladesh is that the cost or rent of furnished apartments is far higher than non-furnished homes – prompting people to dismiss this convenient opportunity. But, perceptions can be wrong.

Do furnished apartments really cost more than non-furnished ones? Yes, and no. Most of the transactions we see on the real estate market for furnished homes tend to be for rent, not sale. And in terms of rent, there is indeed a difference between furnished and non-furnished homes, but not always by much and not always in the same direction.

Gulshan is one of the most popular areas for furnished apartments. It is known and perceived as luxurious and upscale. So if we go by the general perception that furnished homes cost more than non-furnished ones, the difference in rent should be great. But what we see, in fact, is nothing of that sort – only Tk6 difference with rent on average for furnished apartments being Tk47 per square feet and Tk41 per square feet for non-furnished homes. In practice, this translates into a Tk9,000 rent difference between a 1,500 square feet furnished home and a non-furnished home. The difference is even less in some other areas.

Mohammadpur is often considered an underappreciated gem in Dhaka. It was one of the first residential zones in the city and can still boast having some of the best-planned sections. In recent years, there has been a surge of furnished apartments that no one really expected. As a result, the rent of such properties is still quite low – almost equal to that of non-furnished homes. The current average rent of non-furnished apartments in the area is only about Tk17 per square feet, while it is Tk18 per square feet for furnished homes. That is just a Tk1 difference! The scenario is even more unprecedented in Badda where the average square feet rent of furnished apartments is Tk1 less than that of non-furnished apartments!

These numbers may come as a revelation to anyone who does not know the market for furnished apartments in Dhaka city. But as it stands, the current market is ready and prime for furnished apartments because it is not only Gulshan, Mohammadpur or even Moghbazar – rather, it is any place that has such housing types.

Speaking of which, most people associate furnished homes with upscale areas such as Gulshan or Banani. The view is that most of this type of properties are located in those areas. In reality, there are several areas throughout the capital that have a number of furnished apartments, with more areas increasing their supply. There has been a steady growth of such homes in Mirpur, Uttara and Bashundhara Residential Area. All the while, the aforementioned Badda, Shiddheswari, Eskaton and Hazaribagh areas became unexpected up and comers. The number of furnished apartments is certainly on the rise, yet, many still value such homes as “costly.”

One thing that needs to be kept in mind is that “value” can be quite subjective. Something of high-cost can be a necessity to some only to be considered a luxury to others – and the same can be said for property rent and prices. A home in Gulshan, regardless of it being furnished or non-furnished, can be enormous in comparison to other major areas. Take Khilgaon for example. The average square feet price of apartments in the area is about Tk6,346 and the average rent per square feet about Tk16, as can be seen in Bproperty’s database. In contrast, these numbers rise up considerably to Tk12,214 per square feet and Tk38 per square feet, respectively, when we look at Banani. The same goes for every other area.

Prices and rent of apartments vary in accordance with their location. So going solely by price and rent would be the wrong approach. Every area is different in terms of price or rent and needs to be assessed individually by need and budget. Because, otherwise, there is a good possibility of missing out on the most appropriate housing solution.

A diluted picture of the market – in this case, being unaware of the cost and availability of furnishing apartments – can lead to choosing an inferior housing type. If it is possible to find a furnished home in almost the budget, many – especially those moving to a new city – may choose to take the opportunity. But as far as perception goes that furnished apartments are much more expensive than non-furnished ones, the market – and the numbers – say otherwise. Even with the number of such properties being limited in availability, the cost of renting or buying them can still be considered well within the range of new home owners or real estate enthusiasts.