Traditionally, rental properties have been presented unfurnished, without light fitting, if not a ceiling flushed lamp here and there, and without dressings on the windows. Nowadays, the curtains are still not put up but at least the light fittings are more often installed ahead of the rental.
The question of "furnished or unfurnished" arises because the demand for furnished properties is exploding:
- Among the expatriates, many are those who are single, who recently started their working life and who arrive with only their suitcases.
- When the furniture bought for his/her residence in his/her home country is not expensive, it is not worth the expense of a move. It is cheaper to leave them behind.
First of all, what does the law say? The current legislation, namely "the rental lease" of 2006 anticipates the possibility of a furnished rental property and two important points follow:
- By furnished, the law means a property "fully equipped" so 2 or 3 pieces of furniture here and there are not considered sufficient,
- The rent can be increased because of its equipment as long as the rent does not reach twice the rent for the same unfurnished property.
In practice, most often, the cost of furniture is totaled, their monthly depreciation is calculated according to the estimated lifespan of this furniture; monthly rents are then increased accordingly.
Be aware that some pieces of furniture do not stand up to intensive use for very long and they can sometimes be neglected. Most landlords therefore opt for less costly accommodation, but in this case, they cannot claim a very large rent increase.
Fiscally the improvements on a given property are considered as expenses rather than as investments to be depreciated as long as they do not exceed a certain percentage of the total investment. At current market prices, these costs are more frequently to be treated as an expense.
There is little choice in Luxembourg in terms of furniture at low prices, so all owners go to the same branded shops and all rentals tend to be alike.
Watch out for the dormitory effect!
Between amenities that look the same from one property to another and contractual restrictions that prohibit holes in walls and other opportunities to individualise one's home, tenants are often frustrated.
Monde Avenir supports tenants
We suggest decorating ideas to personalise your space. We already told you about it in our December 2020 newsletter and you can find the article on our blog: how to develop a rental property from the tenant's point of view.
Monde Avenir supports owners
You are already a customer with us, you can access our private customer area where you will find useful articles on the legislation in force, the list of furnishings to be provided, or the list of minor maintenance work incumbent on tenants.
To give your rental property a distinctive character, contact us!