For a long time, fair wear and tear has been a grey area for landlords, and because it tends to vary from case to case, it is among the least understood areas of the letting process, and one which can create much ambiguity and cause a high level of disputes with tenants at the end of a tenancy.
Disputes can sometimes end up involving a formal Alternative Dispute Resolution service that generally tends to side with the tenant if the landlord is unable to provide suitable evidence to support their claim. This is because the adjudicators’ starting position is the tenants deposit belongs to the tenant, so if a landlord wants to claim for any part of the deposit, they have to prove the condition the property was in at the start of the tenancy, as well as the end.
But clear property damage and poor cleanliness or anything that is different from the property’s original state is far easier to identify if there is an inventory management report and schedule of condition in place, enabling the landlord to use the tenant’s deposit to compensate.
Since the introduction of mandatory deposit protection schemes, an accurate schedule of condition has become almost as important as the tenancy agreement itself, according to Patricia Barber, chair of the AIIC.
She said: “It’s clear that while the PRS remains a strong investment option - with high tenant demand and the opportunity to generate strong yields - government intervention in recent years has made the prospect of being a landlord more expensive.
“That’s why it’s so important that landlords make sure they cover themselves when it comes to property damage caused by tenants.”
As well as being used as evidence in a dispute, a detailed and precise inventory completed at the start of the tenancy, and again when the tenancy ends, also underlines exactly what is expected of the tenant, while it can also help landlords avoid a disagreement in the first place.
Barber added: “Providing an inventory is a simple and relatively inexpensive step and could save a landlord a lot of money over time.
“During a period when letting property is becoming more expensive and complicated, not providing an inventory could prove damaging to the long-term future of a landlord's investment.”