Imagine if you will, your tenants just moved out and you are in the process of getting your rental property ready to rent again. The refrigerator and dishwasher are about shot, and you are not sure if you should replace them. You figure that maybe the new tenants could bring their own and you certainly don’t want to be on the hook for repairs. What is the best way to handle this? I’ll explain.
What Appliances Must Be Included With a Rental Property?
As obvious as this may sound, appliances that are built in are included in the rent. These items are considered fixtures and therefore part of the real property that is being leased. If it requires more than unplugging to uninstall and move the appliance is probably a fixture. Common examples include garbage disposals, built-in dishwashers, and built-in stoves.
Of course, this will have implications as to who fixes them when they break. The California Association of Realtors contract has a place for “personal property included without warranty and Housing Provider will not repair or replace” but that section is for “personal property” and does not fixtures.
If there is a space in your kitchen cabinets for a dishwasher, then the expectation would be that one is included. The same is true for built-in refrigerators, stoves, ovens, and microwaves. If they are built in, they are fixtures and they are included.
What About Appliances That Are Not Built-in – Are They Legally Required To Be Provided?
In California, believe it or not, rental property owners are not legally required to provide any appliances that qualify as personal property or are not attached. However, just because something is not legally required does not mean it should not be done. Housing providers need to ask themselves if it is good business to provide basic appliances or not.
Should Landlords Include Basic Appliances?
In the Long Beach, Los Angeles, and Orange County markets where we operate the significant majority of single-family houses, condominiums, and apartments include basic appliances like stoves and refrigerators. Here are six reasons why landlords should include basic appliances:
- Appliances are becoming property-specific: long gone are the days when there was an open space where almost any refrigerator or stove would fit. Today most kitchens are designed to optimize the space. Even though many refrigerators and some stoves may technically not be built-in fixtures, the area where they go tends to be a very specific size. These are often precise spaces needing a certain, depth, height, and even doors to open a particular direction. Stoves are no longer as portable as your toaster.
- Appliances last longer than the lease: the average expected life of a basic appliance is about 10 years. It does not make sense to ask a tenant to buy appliances specifically for a property with a one-year lease even if they end up staying four years. What are your tenants supposed to do with the appliances when it is time to leave?
- Drives up the move-in cost: if you insist on not including appliances then prospective tenants will have to factor the cost of buying appliances into their move-in expenses. They will typically already need to come up with the first month’s rent, and security deposit along with paying other moving expenses. The need to purchase a stove and refrigerator adds a significant increase to an already large number. This will make your property less attractive to the general market.
- Moving and installation risk: this is especially true when stairs are involved. Do you want your tenants navigating stairs with a refrigerator? Someone could get hurt. Tenants improperly moving stoves and refrigerators are common reasons for broken kitchen tiles and cabinets. If you oversee the installations, you can make sure it is done by experienced professionals. If it is up to the tenants, it gets very hard to control.
- Competitive disadvantage: since most properties on the market include basic appliances you are at a competitive disadvantage when you don’t. It is what today’s tenants are expecting. If a tenant is searching to find a place to rent and pretty much every place has appliances, why would they choose a place that doesn’t?
- Appliances pay for themselves: having appliances helps to fill vacancies faster and at a higher rent. It can easily take you 30 or 60 days longer to fill a vacancy without appliances. It will most likely be at a rent lower than if you included appliances. You would be money ahead to just buy and include the appliances in the beginning. You will start collecting rent sooner and when they leave you will still have appliances for the next tenant.
Should Appliances Like Washers, Dryers, and Microwaves Be Included With a Rental Property?
Let’s start with microwave ovens. If they are built-in, they must be included. If they are just sitting on the counter like a toaster, we would not recommend including them in the lease. You don’t want to be on the hook for repairs and there is a good chance that a microwave sitting on the counter will inadvertently get packed up and moved out with the tenant. If you want to supply your tenant with a microwave that sits on the counter, give it to them as a present and call it a day.
As far as washers and dryers go, well it depends. If you have a special-sized washer and dryer, especially if it is a stack washer and dryer or a unique dual-use machine that was chosen to fit in a limited space you need to include it. This is very common in condominiums. One could argue if the washer and dryer hookups are on the interior of the home you should probably include them with the rent.
Where it is a lot less cut and dry is when the hookups are in the garage. Then the machines could be included with the property if you want, but maybe you don’t have to. It would be nice but this is something that could be looked at on a case-by-case basis. You will just want to be clear about what happens if it breaks, goes missing, or otherwise needs repair. The same is true for any secondary refrigerators or freezers left in the garage. We will look more closely at those situations in a future blog about appliance repairs.
Bottom Line
Built-in appliances are considered fixtures and are included in the lease. In California, rental property owners are not legally required to provide basic appliances, but most do. Here are six reason reasons housing providers consider it good business to provide appliances: appliances are often a specific size for a particular property, appliances last longer than the lease, not providing them drives up the move-in cost for prospective tenants, there is moving and installation risk when tenants have to source their appliances, not offering them places the landlord at a competitive disadvantage and appliances pay for themselves over the long run. There are some appliances like microwave ovens that are best not included unless they are built in. While others like washers and dryers, need to be looked at on a case-by-case basis, especially if they are in the garage.
We hope that you found this helpful and informative. If so, please like, share, and subscribe. Remember, we are not attorneys or CPAs so we don’t give legal or tax advice.
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If you are looking for a reliable property management company or real estate broker in Long Beach, Los Angeles, or Orange County, California; or you are just considering it and have a few questions about real estate contact the Mike Dunfee Group today! We are happy to help.
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