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In Florida, where thousands of homes and apartments are sold full of furniture, plates, silverware, paintings and sometimes even towels and linens, many sellers feel that offering their goods “turnkey “adds value and justifies a higher price. Above: A list of condos on Fisher Island as of early 2020.

Selling a fully furnished property is quite common in vacation home markets, where a home without furniture can become a hassle for buyers rather than an immediate retirement. But that’s probably not a smart move most of the way.

In the popular ski resort of Crested Butte, Colorado, furnished listings are expected, reports Briggs Freeman Sotheby’s agent Shelle Carrig. “Vacant homes always take longer to sell, unless there’s a noticeable price incentive,” she said in an article for Inman.com. This is not the case in Dallas, where “very few houses” are sold with their original furniture, explains Lucy Johnson, executive at Briggs Freeman Sotheby’s. Most buyers want to put their own spin on a new place, she told Inman.

Indeed, it’s highly likely that budding buyers will simply pass any place listed as “fully furnished” when browsing the market. Even when the idea is intriguing, they are unlikely to give much thought to a property unless the furnishings are up to date.

“Furniture that is not trendy and fresh can prevent some potential buyers from seeing the underlying positive attributes of any home,” Johnson warns.

Then there is the issue of cost. In Florida, where thousands of homes and apartments are sold full of furniture, plates, silverware, paintings and sometimes even towels and linens, many sellers feel that offering their goods “turnkey “adds value and justifies a higher price.

But some buyers may not see it that way, says Christopher Carter of Waterfront Realty Group in Naples. Carter is also a mortgage broker and writes a popular Florida real estate blog.

“In the minds of most buyers, asking prices in furnished real estate already reflect an additional cost, which they may or may not be willing to pay,” he wrote on his blog.

Beyond all of this, selling a furnished home tends to complicate the transaction in more ways than one. Consider sales taxes, for example. In most places, sales tax is not levied on the sale of a home. (There are transfer taxes and other fees, but not sales tax, generally.) But furniture sold with a home is considered tangible personal property. As such, Carter says, they are taxable.

If the contract, or an addendum to it, mentions personal property remaining in the home, the seller may be responsible for collecting and remitting the tax, Carter points out. In Florida, it’s 6% of its value.

Some sellers’ agents “unknowingly create a taxable situation when they attach a written inventory” to the contract, he warns. But whether there is an itemized list or not, the value of the furniture could very well be part of the assessed value of the property. As a result, the buyer’s property taxes could be higher than they should be.

More importantly, the buyer’s lender is likely to take a dim view of the deal, and the appraiser will also want a say in the matter. Carter points out that lenders lend funds for real estate, not personal property. So, if the contract includes furniture, the lender will either return the borrower’s request or refuse it completely.

Why? The house is a permanent structure that serves as collateral behind the mortgage. “Homes and condos usually stay where they were when purchased,” he says, “which isn’t always the case with couches, beds, dressers, and lanai lounge chairs.”

It is normal to list items such as ceiling fans, light fixtures and draperies that are attached to the property and remain in place. Ditto for large kitchen and laundry appliances: Even though they are removable, they generally carry unless the contract states otherwise.

But if the contract mentions wall hangings and a golf cart, “the buyer’s lender will flag the contract and force everyone to start over,” Carter writes. “Even when a specific or itemized value is not given to personal property, mentioning it in a written real estate contract artificially increases the value of the deducted property,” which lenders won’t allow, says Carter. The result: unnecessary delays that neither side wants.

There will also be a problem with the evaluation. Appraisers are trained to remove the value of any personal property mentioned in the contract when establishing an appraisal. In other words, they have to subtract personal property from the agreed sale price – which, of course, means a lower valuation.

If the home’s appraisal isn’t good enough, three things can happen: the buyer will have to come up with more money for a down payment, the seller will have to lower the price to make up the difference, or the buyer and seller can put up their hands and walk away.

The best way to handle the sale of a furnished house is to sell the house separately from the furniture. Place a price on each that will add up to what you wanted for them together. Then the buyer can either pay cash for the furnishings or choose to finance both – the home with a mortgage and the furnishings with a personal loan.

Lew Sichelman has been covering real estate for over 50 years. He is a regular contributor to numerous shelter magazines and housing and housing finance industry publications. Readers can contact him at [email protected]