New tenant wants to pick and choose furniture.

*Robin*

Please be gentle.
So, I am going to rent out the family home for a few years, starting next January. Joined Landlordzone (and will also join NLA). Have had all the maintenance done I can think of, booked the gas safety check (and have insured the central heating). The tradesmen who have helped maintain the house are on call should my tenants have a plumbing, electrical or building emergency (chargeable to my account). I have changed the B&C insurance to Landlord's insurance, and am busy emptying the house as it was my intention to let it unfurnished. Still need to arrange an EPC, but it's on the list.

I have not yet advertised, but a tenant has found me. The couple seem ideal; academics from abroad studying for PhDs, who want a stable home for the next four years where pets are permitted.

We have agreed a rent rather under market value but we're all happy with (worth it for me to avoid voids and not having to replace all the carpets before the tenancy starts).
However the potential tenants have asked if I will leave all the white goods and most of the furniture for them to use. Now I don't mind doing this if the tenants are responsible for it all during their tenancy - so if the washer or fridge breaks down they will fix or replace it rather than calling on me - but is this acceptable or legal?

I have storage arranged for all my things so that is not an issue, and having spent many hours reading other threads on here I'm aware that the landlord is normally responsible for any white goods or furniture provided, but in this case as far as I'm concerned I'll be doing them a favour and the reduced rent they will be paying does not allow for replacing white goods that would not have broken if they were in storage.

To forestall some of the questions that might change the advice given:
A) No there is no mortgage.
Credit check is arranged, will be done next week.
C) I would rather rent than sell as I will need the house in a few years' time; it's in one of the few areas of the UK where prices are still rising slowly, so I'd have trouble buying another one as suited to me as this house is, when my work brings me back to the area.
D) The initial tenancy would be a 12 month AST, renewable annually if both parties are happy.
E) Yes I'm aware of my tax liability.

So my questions are:
1) Can I in this situation let the house unfurnished, but put something in the tenancy agreement to the effect that certain specified items are provided on the understanding that the tenant is responsible for returning them in good/working condition at the end of their tenancy?
2) At the end of the initial 12 months it would suit me better if the tenants commit to another 12 months rather than go onto a rolling periodic tenancy; can I insist on this or would it breach the tenants' rights?
3) Does the fact that this tenancy could last for four years change the rules - would it in fact be an AST?
4) What have I forgotten, please?

I really want to do this right, have read all the flaming comments about accidental landlords in other threads so don't need reminding - this is really the best solution for me at this time - thanks, and apologies for the length of this post.

theartfullodger

Academics from abroad... hmmmnnnn so if things go wrong or they escape back home no real recourse... I'd ask for a Guarantor & only do 6 months initial..

I say to new tenants - 6 months to start, if you are happy & I am happy you can stay as long as you like... I much prefer rolling month-by-month, but agents in particular like renewals ..(...to get the fees??)

They may not realise that if they found the PHD didn't suit, the house wasn't what they expected or things go wrong that they are liable for 12 months rent.. but if they just upped sticks & left you'd have little or no chance of getting your money back...

Sounds like otherwise you are thinking along the right lines..

Oh, get a couple of estate agent valuations in case you ever need to pay CGT.. so you'll have a start figure..

Furnished/unfurnished: Tenancy and inventory will be the same type, but inventory longer for furnished..
http://www.hmrc.gov.uk/manuals/pimmanual/pim3200.htm

The 10% deduction is given to cover the sort of plant and machinery assets that a tenant or owner-occupier would normally provide in unfurnished accommodation. These are things like:

• movable furniture or furnishings, such as beds or suites,
• televisions,
• fridges and freezers,
• carpets and floor-coverings,
• curtains,
• linen,
• crockery or cutlery,
• plant and machinery chattels of a type which, in unfurnished accommodation, a tenant would normally provide for himself (for example, cookers, washing machines, dishwashers).

This list isn’t meant to be complete but gives an idea of the assets the wear and tear allowances covers.

You can claim 10% wear-n-tear on furnished but if you look up HMRC guidance the list of stuff required for furnished is longer than many LLs supply .. (and still probably claim 10%)

An AST can be for any period from 1 day to 7 years: Over 3 year initial fixed term must be as a deed. Starting with 6/12 months then rolling on month-by-month or renewing does not require deed. (People say it must be 6 months: Untrue but Section 21 of the Housing Act 1988 means you can't just evict for no reason until after 6 months.... so most ASTs are minimum 6 months..)

If tenants started asking for more after agreeing a rent figure I'd either raise rent proportionally (eg £5k extra furniture I'd add, say, £100/month - assuming 5 year life) or wonder what else they'll be asking for ...

mrschaucer

[QUOTE


I have not yet advertised, but a tenant has found me. The couple seem ideal; academics from abroad studying for PhDs, who want a stable home for the next four years where pets are permitted.


[/QUOTE]

These aren't academics on juicy 4 yr contracts, they're students - and foreign students at that - so as above, make sure you get a UK guarantor.

princeofpounds

1) Can I in this situation let the house unfurnished, but put something in the tenancy agreement to the effect that certain specified items are provided on the understanding that the tenant is responsible for returning them in good/working condition at the end of their tenancy?

If the place is furnished then the tenants are responsible for returning items in the same condition minus fair wear and tear. It is good to remind them of this in the contract.

Regarding white goods, you are allowed to provide them and contract out of repairing obligations, but you must do this explicitly in the contract. If you provide them without making the repairing status clear you might be liable for them by implicitly being a provider of white goods 'services', not just those particular machines you actually have in the house at the start. You cannot contract out of repairing devices that are necessary for use of utilities, hot water and heating (boilers etc).

2) At the end of the initial 12 months it would suit me better if the tenants commit to another 12 months rather than go onto a rolling periodic tenancy; can I insist on this or would it breach the tenants' rights?

You can insist, but if they say no you would have to pursue eviction proceedings to get them out if they do not leave voluntarily. Typically it is not worth it, because if you want a 12 month contract to avoid a void period, by retaliating in this manner you create the very void you were afraid of.

3) Does the fact that this tenancy could last for four years change the rules - would it in fact be an AST?

It WILL be an AST, unless you do something unusual. Clearly you still need to brush up on things a bit. And if you sign an AST for a long period of time it must be executed as a deed rather than a contract, there are further specific rules about long tenancies on top of that. So signing multiple 6 month to 2yr contracts is normally a simpler option.

4) What have I forgotten, please?

If you are abroad, register with HMRC to receive tax undeducted or get a UK based agent to receive the rent.

If you rent furnished, you can offset more income against tax.

sequence

I'm not certain, but I think you can contract out of repairing white goods. You can't contract out of other repairing obligations though, such as plumbing, electrics, fabric of the building.

So if you put in the contract that you won't repair white goods, then it's all good.

hazyjo

Not sure on the legals, but pretty sure anything you leave must have some sort of check/approval done on it - and some furniture has to have tags saying it's resistent to fire, etc. Am sure someone else can clarify, I'm vague on it, but thought it worth mentioning.

Jx

RAS

Regarding B

You cannot usefully credit check overseas students unless they have already been studying in the UK studying taught courses. Otherwise they have no credit history.

So you need to know their background. You need to see their current and previous student visas and details of their university registration.

Also PHDs usually take 3 years, although they may get as short extension for writing up.

princeofpounds

Also PHDs usually take 3 years, although they may get as short extension for writing up.

Every PhD I've ever known well (4 so far) has taken between 4 and 5 in the end!

Yorkie1

hazyjo wrote: »

Not sure on the legals, but pretty sure anything you leave must have some sort of check/approval done on it - and some furniture has to have tags saying it's resistent to fire, etc. Am sure someone else can clarify, I'm vague on it, but thought it worth mentioning.

Jx

Soft furnishings must meet the fire resistant regulations - usually has the tag on to show compliance.

No legal requirement for PAT testing / electrical certificate for electrical goods but they must be safe. A PAT test is a good way of showing that they are safe though.

Gas safety certificate is required for anything using gas.

*Robin*

Thank you very much to everyone who has posted, for giving me plenty to think about!

The company who will be doing the credit check told me they can and will make international enquiries, so it had not occurred to me that I might have a problem if the tenants' lives changed leading to them returning 'home' unexpectedly.
One of the couple is currently studying at university here so I assume they have some records in this country, but I can see the sense in asking for "a UK guarantor" - but what exactly does that mean; a UK national who is also resident in the UK? And in that case, would a credit check be required for both tenants and guarantor, or just the latter?

theartfullodger thank you very much for the link; I wish I understood 'govspeak' better, but accept that if I leave any furniture in the house then I am creating a furnished tenancy. Will do more reading about the implications of that, as I had previously decided to go down the unfurnished route as the simplest and least likely to lead to problems later on (there are plenty of threads on MSE about arguments over damage vs fair wear and tear - I was hoping to avoid that possibility). Thanks to princeofpounds for clarifying the issue of responsibility for maintaining white goods.

One thing I didn't make clear in my original post, is that the [potential] tenants asked if they could keep most of the furniture for a few months until their own stuff is shipped over, then would like me to remove the duplicated items.. (hence the thread title which I should have changed before posting once I'd set down all my queries; apologies for that).
I'm all for being helpful to my tenants as I do want them to be happy, but can see a potential for trouble as I do not want to be called back to remove 'x' every time they acquire an item that duplicates 'x' which they'd initially asked me to leave in the house. As theartfullodger says, what else are they going to ask for? ..And I'm pretty sure that they aren't envisioning an increase in the agreed rent to cover any of the things they'd like me to leave..

Am left wondering if maybe this couple would not be ideal tenants after all, but on the other hand my gut feeling about them is positive. So before I make a decision, can anyone please advise further about what I should ask for with reference to a guarantor?

And thanks again to everyone who has offered help - much appreciated.

BitterAndTwisted

*Robin* wrote: »

One of the couple is currently studying at university here so I assume they have some records in this country,

In ehich case they should be able to furnish you with their current landlord's details for you to get a reference

but I can see the sense in asking for "a UK guarantor" - but what exactly does that mean; a UK national who is also resident in the UK? And in that case, would a credit check be required for both tenants and guarantor, or just the latter?

Yep, a UK national who is also resident here. If they default or do a runner you DO NOT want to have to chase someone in Timbuktoo.

And yep, credit-checks for both the tent and their guarantor.

I'm all for being helpful to my tenants as I do want them to be happy, but can see a potential for trouble as I do not want to be called back to remove 'x' every time they acquire an item that duplicates 'x' which they'd initially asked me to leave in the house. As theartfullodger says, what else are they going to ask for? ..And I'm pretty sure that they aren't envisioning an increase in the agreed rent to cover any of the things they'd like me to leave..

In which case you need to be crystal-clear from the outset that you will be prepared to remove any items from the property ONCE when their stuff arrives from abroad. If they are already renting here why isn't their stuff here with them already?

Also, if you haven't been actively advertising for tenants yet how have they found you exactly?

Do you know which country they are from? Be wary if they are from south-east Asia. You DO NOT want to find that they are front-people for a cannabis-farming organisation. Tell them that you will be carrying out landlord's inspections from time to time at the beginning of the tenancy to ensure that everything's running OK for them.