Should landlords let furnished or unfurnished?

Many landlords are unsure of the difference between renting out a furnished and unfurnished home.

Experienced landlords know the answer is simple – a tenant only has to walk in to a furnished home with their personal belongings and linen to make a buy to let their home.

An unfurnished home generally comes with carpets, curtains and white goods – like a fridge, cooker and washing machine.

Letting furnished or unfurnished depends on the property and the target tenant market.

Here are some points a landlord needs to consider when furnishing a buy to let property:

Furnished lettings

  • Attract younger tenants who may not have their own furniture
  • The moving in process is quicker
  • Landlords can set off wear-and-tear on furniture against rent
  • A furnished home attracts a higher rant than a similar unfurnished home
  • Landlords must comply with fire safety regulations
  • Landlords must pay for replacing furniture that’s past the sell-by date
  • If the tenant doesn’t want some or all of the furniture, the landlord must arrange storage

Unfurnished lettings

  • Tenants who make a house a home with their own furniture may stay longer
  • No replacement or repairs are needed at the landlord’s cost
  • Rents are lower for unfurnished homes
  • Landlords cannot set of any wear-and-tear allowances against rental profits

Landlords letting furnished property can set off 10% of the value of the furnishings supplied against rents every year – even if the property is making a loss.

However, landlords cannot claim the cost of providing the furniture as a business expense – only wear-and-tear, which is a tax relief for depreciation.

Whether a property is furnished or unfurnished also affects council tax in some areas.

Many councils offer a discount for empty properties for up to six months – but only if they are unfurnished. This exemption is fast disappearing as councils try to claw back revenue that is disappearing through government spending cuts.

Providing furniture also depends on a landlord’s target market – students and young professionals expect furnished lets, but couples and families often prefer to rent an unfurnished home.