As a Letting and Managing agent, this is one of the most frequent questions we are asked by potential Landlords looking to invest in property to rent in the area. We are specifically asked for the difference in the market value between the two and which is more popular.
Typically these days there is little difference in rental price that can be attained. Although for valuation purposes furnished properties are slightly higher than unfurnished.
The numbers of enquiries we receive for furnished and unfurnished property to rent in Leamington, Warwick and Kenilworth areas are also split quite equally and we see little difference between the two types of enquiry.
There are, however, some advantages to letting an unfurnished property:
The main difference is to wear and tear on the property. Furniture is usually much more likely to wear than fixtures and fittings and therefore you need to factor in the costs of replacing it.
Furniture is more likely to be damaged and if Letting a furnished property the Inventory and Schedule of Condition should indicate the age and state of all the furniture. This gives more evidence if it comes to charging a tenant for damage.
If you decide to let the property with furniture, you should consider carefully to what level. Typically requirements will be for the Kitchen to have all appliances such as oven, fridge/freezer and washing machine as a minimum. Bedrooms should have beds, wardrobes and drawers and there should be sofa, armchairs and a dining table if room permits.
When renting a furnished property you also need to be aware of the following regulations:
- The Electrical Equipment (Safety) Regulations 1994
- The Furniture and Furnishings (Fire) (Safety) Regulations 1988 (amended1989, 1993 and 1996)
The Electrical Equipment (Safety) Regulations 1994, and certain other regulations stipulate that equipment provided in tenanted premises must be safe. It is therefore necessary to make a visual check to ensure that all electrical items, plugs and leads appear completely safe and undamaged, and remove or replace any faulty items. A periodic fixed wiring inspection by an authorised company is recommended. It is also recommended that all portable appliances be tested (PAT) annually.
Although it is not yet a legal requirement to have them tested it is certainly recommended and shows due diligence if a problem does occur.
Appliances are often the most likely to break down and need replacing and obviously the more that are supplied the higher the cost of annual testing.
For these reasons we recommend that TV’s radios, toasters and kettles etc are not supplied even in furnished properties.
In addition if a TV is supplied then legally the house owner is responsible for the license if the tenant does not apply for one.
The Furniture and Furnishings (Fire) (Safety) Regulations 1988 (amended 1989, 1993 and 1996), and other regulations provide that specified items supplied in the course of letting property must meet minimum fire resistance standards. The regulations apply to all upholstered furniture, beds, headboards and mattresses, sofa beds, futons and other convertibles, nursery furniture, garden furniture suitable for use in a dwelling, scatter cushions, pillows and non-original covers for furniture. They do not apply to antique furniture or furniture made before 1950, bedcovers including duvets, loose covers for mattresses, pillowcases, curtains, carpets or sleeping bags. Items which comply will have a suitable permanent label attached. Non-compliant items must be removed before a tenancy commences.
Renting furnished does have some benefits. Tax allowance is given for wear and tear and on the cost of replacement (but not original purchase) of furniture and appliances. Guidance should be sort from a tax advisor on what can and can not be claimed.
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