To furnish or not to furnish? That is the question.
It’s no surprise that letting a property involves making some tough decisions. But there’s one in particular that can leave landlord’s scratching their heads. Whether to rent out a furnished or unfurnished property?
It’s a topic that the rental market has debated for years—and for good reason. Not only will your choice impact the amount of rent you charge, but it also significantly influences the type of tenants you attract.
Both options will, of course, have their pros and cons. But delving into the crux of what they are will be invaluable for your investment strategy. In these changeable times, this has never been more crucial.
But before we get into the debate, let’s define exactly what we mean by furnished or unfurnished properties.
It’s worth noting that there’s no legal definition of ‘furnished’ or ‘unfurnished’ properties.
However, landlords are obliged to provide safety equipment like fire alarms, carbon monoxide alarms and, in some cases, fire blankets. For more information on landlord safety responsibilities, check out this blog.
So, unfurnished properties mean that the space is like a blank canvas; it’s up to the tenant to fill it with furniture, tableware and anything else that allows them to live comfortably.
But that doesn’t mean that unfurnished properties are completely bare. As a landlord, you’ll still be expected to provide the following at a minimum:
- White goods (cooker, washing machine, fridge-freezer etc.)
- Kitchen and bathroom fixtures (sinks, toilets, shower/bath, extractor fans, oven hoods etc.)
- Household basics (doormats to protect your floors, dustbins etc.)
- Carpets/other types of flooring and curtains/blinds
But when it comes to furnished properties, things are slightly different, it’s up to the landlord’s discretion to decide what/how much furnishings to include. However, you’ll still be expected to provide the following:
- Everything that comes with an unfurnished property
- Smaller appliances such as microwaves, kettles and lamps
- Sofas and/or armchairs
- Bed, bed frame and mattress
- Chest of drawers, wardrobes and coffee tables
- Dining room table and chairs
- Garden furniture (where applicable)
- Mirrors and, in some cases, artwork
Okay, now that we’ve covered the basics, let’s dive straight into the pros and cons—starting with cost-effectiveness.
A Case of Cost-Effectiveness
At a glance, you may think that furnished properties are hands-down the most economical for both landlords and tenants—and we don’t entirely blame you.
For a start, landlords can charge more for rent if they decide to furnish their property. According to research conducted by OnTheMarket, a 2-bedroom furnished flat in Sheffield can cost up to 21% more per month than a property of the same size in the same area.
The study also found that in London, landlords can charge up to £128 more for rent (9% difference), and in Manchester, there was a £101 increase (15% difference) in 2-bedroom properties.
Of course, the amount of rent you charge will need to reflect your area’s current market. But the research suggests that furnished properties can achieve higher rents, especially if the market deems them attractive.
And since you’d be furnishing the property items you’ve purchased, landlords tend to require higher security deposits — and with a slow burn of evictions expected to take us into 2022, the more financial stability, the better.
While tenants get to save expenses on purchasing pricey items, you can also keep annual costs low by reusing good-quality furnishings once the tenancy ends. It’s a win-win for all.
Less Hassle…but by how much?
So, there’s no denying the clear benefits and level of convenience in moving tenants into a property that’s ready to go. But it’s crucial to ask yourself which type of tenants you’re targeting.
As furnished properties are ideal for those wanting flexibility and a hassle-free move, you’ll most likely attract students, young professionals or anyone who needs to move quickly.
And while having a niche will help strengthen your marketing strategy, this fast-moving nature could leave you with an unwanted revolving door and a burning hole in your pocket.
The ease and flexibility of furnished properties tend to produce a higher turnover of tenants, and landlords will have to work harder and more frequently to fill up the space.
Longer contracts, more stability
This is where unfurnished properties come in handy. You’re more likely to attract tenants who’ll opt for a longer tenancy, as they would have invested more of their time and energy into the moving process.
Equally, tenants are more likely to stay for the long term if they feel more at home—and considering we’ve spent less time commuting and more time watching Netflix*, personalising your home is a top priority.
But this can be a big problem for tenants, especially those who only stay for a year. In a 2015 study, 43% of respondents said they’d be willing to pay more rent if landlords allowed them to personalise their homes—so there’s definitely a demand for it.
And while giving tenants the creative freedom to fill the space with their own furniture is a great way to remedy this, opting for unfurnished also means that they’ll be lower maintenance for you.
As it’s their belongings, landlords won’t have to deal with replacement requests, storage concerns or keep track of any items that need updating before the next occupant moves in.
We’re also talking about shorter inventories, fewer ‘wear and tear’ concerns and other unfurnished perks that can inject ease into your investment strategy.
But, of course, landlord’s won’t be able to achieve a higher rent with unfurnished properties, and if that’s a deal-breaker in your decision, then a part-furnished finish could be your best bet.
Part-furnished properties are an ideal middle ground for tenants, such as employed couples, who may have already started buying their own furniture but still want that flexibility and ease.
As a landlord, you’ll choose how to stage your part-furnished property. But you’ll only be expected to provide items that will make the space liveable, such as white goods, sofas and dining room tables.
And while providing good-quality furniture goes without saying, it’s worth ensuring that they’re modern and neutralised. All the homely touches, such as coffee tables and rugs, will be the tenant’s responsibility.
Striving for this balance will do wonders for your investment strategy. Not only will you reduce the chances of having unhappy tenants who dislike the furniture, but you’ll also charge them a slight premium for the necessities and for them to add a personal, homely touch.
This way, you’ll be attracting tenants who may decide to extend the tenancy while also enjoying the financial stability that furnished properties bring.
But of course, every landlord will have their preference, and while the furnished vs unfurnished debate lives on, it’s up to you to decide what side of the coin you’re on.
So, to furnish or not to furnish? That is the question!
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