Should You Furnish Your Rental Property?

Written By PropertyLoop
March 30, 2021

The decision on whether or not to furnish your rental property before letting it out to tenant’s shouldn’t be taken lightly. Ultimately the degree to which a rental property is furnished and the choice of furnishings can hold huge influence of potential tenants and if they want to progress into a tenancy agreement. But, as always there is far more to consider here than what furniture to choice, landlords can expect generous benefits and some shortfalls in both furnished and unfurnished properties, with potential tax relief, longer tenancy periods and higher rental payments to asses, here we help landlords navigate the pros and cons of a furnished rental home.

What Is a Furnished Rental Property?

Typically better suited and more commonly offered to students, younger renters or youthful professionals, furnished properties can be a relief to those simply looking for accommodation for a short period of time; or those that are yet to own a range of furniture.  Essentially if a landlord is offering a rental opportunity in a furnished state, then the property will contain all the expected basic pieces of furniture like beds, sofas, tables and chairs. Whilst this is common practice in the rental market potential tenants should remain vigilant when searching for their future home as landlords do offer properties with varying degrees of furnishings, with some properties only being ‘partly furnished’ or even ‘unfurnished’, meaning the property will be passed onto the tenants completely empty, with the expectation to supply their own furnishings and amenities being firmly placed on the tenants.

Furnished or Unfurnished?

Whilst it is true that the decision on whether to let out you rental property furnished or unfurnished does depend on the type of tenant that you wish to attract, with students and young professionals usually opting for fully furnished opportunities, and families having their own items to move in with; there are many things to consider alongside this.

Perhaps the greatest appeal of a furnished property is the ease in which a tenant can transition into their new accommodation and lifestyle. Some will argue that this will attract a larger pool of potential tenants to choose from, especially in largely populated areas. The power of providing a convenient, ready-made home cannot be understated, saving the new occupants of the rental property the huge monetary and administrative expense of finding and purchasing large amounts of furnishings whilst moving in.

With this being said, if a property is being let unfurnished and the future occupants already possess the furnishings they need, then they can truly make their new setting their own home, without having a property with character not to their taste.

Letting out a property unfurnished also lends some financial incentives to both the landlord and tenants, with the property owner being saved from the exorbitant price of decorating, and the tenant not having to worry about losing their deposit.

Whilst a furnished property may allow the landlord to enjoy the benefits or a potentially larger pool of tenants to choose from, an unfurnished let can also provide its own security. With tenants feeling more comfortable in their accommodation after furnishing it to their tastes they may be compelled to stay in the property for extended periods of time; especially with the potential for longer tenancy periods allowing the tenants to avoid paying future moving costs.

It is important to remind the tenants that once the tenancy agreement has been singed they are responsible for the condition of the property and to take considerate care when using its furnishings. It is expected that a tenant will return the rental property in the same condition it was in when the tenancy period began.

How Much More Can You Charge for a Furnished Rental?

Of course, if a rental opportunity goes above and beyond providing the expected amenities and furnishings it can demand a higher monthly rental price than competing rentals in the area.  Tenants have historically proven that they are happy to pay a little extra in rent for the convenience and quality of furnishings, with a 2018 study conducted by OnTheMaret, revealing that a premium of up to 21% has been found on two bedroom flats, when compared to similar, yet  unfurnished local rentals.

It is worth mentioning that some landlords will ask potential tenants for a higher deposit at the beginning of the tenancy period in an effort to incentivise them into better looking after their property and its contents. With this being said, with the introduction of the Tenant Fees Act 2019 any landlord in the private rented sector of England is limited on the amount they are able to take from tenants as a deposit, preventing landlords from historically charging tenants excessive amounts before moving into the property. The act caps the maximum amount a landlord can take as a holding deposit at the equivalent of one week’s rent, with security deposits being limited to five weeks of rent if the value of the rental property does not exceed £50,000, with this threshold being placed slightly higher, at six weeks rent, if the property is worth more than this amount.

What Should a Furnished Rental Include?

Technically there is no strict or linear legal definition as to what is considered a furnished property. However, this doesn’t mean that an unfurnished property can or should be completely baron at the start of a tenancy. Tenants can rightfully expect kitchen appliances and white goods, alongside soft furnishings such as carpets, blinds, sofas and bedroom furniture. It is worth considering that when choosing to furnish a property , future tenants will be looking to make this their home, so colour natural decorations and a ‘less is more’ approach to furnishings could be the way to go.

What Is Wear and Tear?

It is to be expected that over the course of many tenancies a few of the items within the property will be subject to unavoidable ‘damage’ through continued use. This natural wear and tear regards the gradual degrading of a property, encompassing scuff marks, scratches and other minor blemishes that come with a well lived in home. It is important to define this as landlords will naturally be accountable for maintaining the property, with the deposit taken from tenants at the start of a tenancy period covering the costs of any remedial work that was caused through damage not considered “fair wear and tear”.  Damage that is not considered fair wear and tear is not a result of age or heavy use, but typically neglect or malicious intent by the tenant. Examples of this neglectful behaviour would be holes in interior walls, smashed mirrors or windows and any excessive pet related damage.

Do You Need a Landlord Inventory?

An inventory is essential for landlords that wish to let out their rental property fully or even partially furnished. The report details the condition of each room, its fixtures and appliances so that at the end of the tenancy period the document can be referred to if there are any disputes over tenant caused damage or fair wear and tear.  If a landlord does not conduct a throughout inventory before the tenants move into the property then they may find this hinders their ability to recover any repair costs from the deposit if they are in disagreement with the tenant in regards to who is liable for the damage. This is because without any proof of the condition the property was in prior to the tenancy the landlords claims are unjustifiable.

Do Landlords Need Contents Insurance?

Unlike building insurance, a landlord situated in the UK is not legally obligated to take out contents insurance. However, this does not mean it should be dismissed by landlords, especially those that are thinking of letting out their rental property with furnishings for the tenants to use. Typically, contents insurance for landlords will cover the costs associated with replacing or repairing any appliances, furniture or items owned by the landlord in a rental property with a currently active tenancy.  

Whilst it will vary between the individual policies and the insurance provider themselves, contents insurance for landlord cam ne am essential safety net, protecting landlords from accidental damage, alongside the eventuality that the tenant decides to cause deliberate damage to the property or its contents, or steals the landlords possessions from the rental property.  Landlord contents insurance can also financially safeguard a landlord from damage caused to the property through storms, water damage and any loss of metered water. In the unlikely event of a fire, excessive flooding or other damage to the property that requires the tenants to be placed temporarily in alternative accommodation, or when any damaged or old items need replacing, a good landlords contents insurance policy will cover the cost of these also. Of course if the damage to the property is excessive then the tenants may not be required to pay rent, leaving the landlord with lost income, contents insurance can also remedy this loss of rent for landlords.

Like many of us, landlords will not foresee many of these events transpiring but it’s essential to have some protection for your investment. With that in mind, it is equally important to know the shortfalls of these standard policies and what they will not cover, requiring additional payments from the landlord for this extra insurance coverage. This tends to be applicable in instances where the rental property is unoccupied, with water damage and theft in a vacant property falling under these additional cost brackets. It is important to also note that any malicious damaged caused by a tenant that failed their credit referencing checks, wear and tear on furnishings and appliances or harm to high value assets will also not be covered by a regular landlord contents insurance policy.

Finally, landlord contents insurance is exactly that; policies will not cover the possessions that a tenant brings with them into the rental property. If a tenant wants their items to be insured then they will be required to take out their own contents insurance.

Fire Safety Standards

Perhaps one of the most important roles of a landlord is to constantly uphold the totally safety of those inhabiting their rental properties.  Aside from extinguishers, blankets, smoke and carbon monoxide alarms being required throughout the property, any upholstery and furniture items brought into the property by the landlord must first meet the standards of the 1988 Furniture and Furnishings (Fire Safety) Regulations.

Encompassing sofas, chairs, ‘convertible furniture’, beds, pillows, garden features that could be utilised inside the rental alongside headboards, divans and seating pads, the regulations demand that all furniture is to be made of fire resistant materials.

All applicable furnishings found throughout a rental property must have an intact label declaring that the item has satisfied the necessary safety checks. These checks include assessing the piece’s resistance to ignition through matches and cigarettes, with the minimum resistance level being established by the regulations.

As the landlord is only liable for the furniture that they install in the let for the rental properties occupants, similarly to contents insurance, the landlord is not responsible for the tenant’s belongings or personal furnishings. However, if the landlord fails to fully comply with the fire safety regulations will be treated as a criminal offence. If an occupied property is found to not meet the safety standards the landlord could face a fine of up to £5,000 for each furnishing item in breach of the regulations, alongside a six month term in prison. With this being said, if a landlord is able to clearly demonstrate that they took all the necessary action possible to address these failures, this could act as a defence if legal action is pursued.

PropertyLoop is the world’s first commission free lettings platform. Our platform allows landlords to advertise their rental, reference tenants, curate an agreement, register the deposit and collect rent completely for free! There are no hidden charges, upfront fees or any catches.

Built by experienced property investors and landlords, PropertyLoop connects renters with the owners directly. Your property is featured on all major search and comparison portals as well as advertised by PropertyLoop everywhere else on the Internet. You don’t have to worry about finding the good renters, that’s the job for the platform. Receive offers straight to your mailbox and select the renters that are right for your property. Need access to busy London property market? No problem at all! PropertyLoop is the London market specialist with years of experience and unique knowledge. Whatever your needs are, you can always speak to friendly support staff. Renting property is made as simple as one, two, three.

Landlord AdviceLandlord RegulationsNew LandlordsRental property

Share article

Subscribe to our newsletter

Stay up to date with the latest marketing, sales, and service tips & news.

We are commited to yor privacy.You may unsubscribe from these communications at any time.
For more information, check out our privacy policy.