The government’s decision to cap tenancy deposits at no more than five weeks’ rent where the annual rent is up to £50,000 could, according to some market commentators, lead to an increase in formal deposit disputes in the private rented sector.
The change is part of several measures designed to “make the private rental market more affordable and competitive”, the government said.
The Association for Independent Inventory Clerks (AICC), like several other organisations, is concerned that as tenants commit less money to cover damages at the start of a tenancy, they may take a more laid-back approach to the rental property, leaving landlords with more damage and repairs to deal with, resulting in a higher number of formal deposit disputes.
Assessing what constitutes fair wear and tear to a rental home is among the least understood areas of the lettings process, and one which can create much ambiguity and cause the most disputes when a tenancy ends.
Alleged property damage, cleaning and redecoration are generally among the most common reasons for a dispute between landlords and tenants, which can sometimes end up involving an adjudication service.
To help minimalise potential disputes, it is good practice to have a detailed and accurate inventory completed at the start of the tenancy, and again when the tenancy ends.
If the tenant has agreed the inventory at each stage, this reduces the potential for a dispute to arise at the end of the tenancy.
An inventory, which records the condition of the property with written notes, photographic evidence, as well as details of the contents, including fixtures and fittings, will be helpful in supporting a claim on a deposit, because if a disagreement does arise, a decision to resolve the matter will be based on the evidence provided by both the landlord and the tenant.
Failure to provide suitable evidence, such as an inventory, in support of a claim, may affect the outcome of the dispute.
Daniel Zane, chair of the AIIC, warns landlords of the dangers of tenancies not verified by an independent, third party inventory report after adjudicators at The Deposit Protection Service (DPS) recently heard a case where although the landlord was claiming for cleaning and damage, the tenant won the case because the adjudicators could not establish that the landlord and tenant created their check-in reports at the same time.
The DPS stated that the burden of proof, as ever, is on the landlord to provide enough evidence to establish the tenant’s liability.
Zane, who is also the direct of My Property Inventories, said: “Moving in without an AIIC member independent inventory report means that neither party can unconditionally prove how the property was handed over or returned.
“An adjudicators award will inevitably veer away from the landlord every time. The importance of an unbiased report is second only to the signed tenancy agreement.”
Zane added: “Some agents have taken to compiling inventory reports for their landlord clients. This is both unprofessional and not acceptable evidence in order to offer the high level of protection all parties deserve. Alongside this it can mean the landlord losing any valid claim made by them for damage or neglect within the property.
“We are experiencing a large number of complaints by all parties about reports that are not by our members and we keep hearing they were via the landlord or agent themselves. Agents are not independent, and neither them nor landlords should spend their time compiling reports which cannot be relied on in all adjudication cases.
“We believe we are heading towards a large wave of liability court claims aimed at agents that gave their landlord clients inventory reports compiled by them that later on will not stand up in a dispute due to their biased nature.”
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The condition of the property at the start and end of each tenancy is much more important than counting knives and plates. Landlords can easily do all of this themselves with a smart phone and email. No need to employ anyone at OUR expense.
You’re missing the point, a AIIC Inventory company offers impartiality. In 20 years with my portfolio I’ve not had one dispute and any monies kept by me were fully agreed by the tenant.
Someone else that you have to pay. I had done Inventories for 30 years and managed them myself without much problem but not since 2007 when they were taken away by Shelter base on untruths I used a Clerk once £250 check-in & £150 check out, that’s the end of that, or far better still not be a LL.
Nick Duncan. I get the point. Someone wants me to spend money on something neither I nor my tenants need. I too have over 20 years' experience as a LL, building up a £4 million portfolio from an initial £10k deposit on a £60k flat, rented out for £600 per month (which stayed the same for about 12 years but is now £1440 due to SNP anti tenant legislation). During this time I have developed a tenant arrival/departure check list backed up by photos and signed by both parties. No disputes, no arguments, properties are handed back in more or less the same condition or the tenants pay for cleaning, refurbishment, repairs etc. I would rather budget a couple of hundred to fix or restore things than give it to a third party to record things, counting spoons etc.
Absolute nonsense from the AIIC as usual. Why is an inventory prepared by an agent or landlord "not acceptable evidence" ? Which adjudicator ever said that? How many disputes have been lost due to perceived bias? I'd like to know. I bet the AIIC cannot provide a single statistic to back up this article. AIIC members pay a fee to join and suddenly become "professional"overnight.
One of the poorest inventories I have ever seen carried the AIIC logo, not to mention the poor conduct of the clerk who wanted the tenant to sign for keys but couldn't tell her what the keys were for. I represented the tenant at her check in and the conversation went something like this:
"I think this is for a post box"
"Where is the post box"
"I don't know"
So you haven't checked it?"
"No"
"Where are the meters?"
"I don't know"
Nor did she notice that the apartment's upstairs access door did not have a key! In fact the access door did not appear on her inventory at all. Neither did the burn marks on the kitchen floor. She tried to pass off heel indents on a laminate floor as "fair wear and tear" when I asked why they were not noted on the inventory. And when I complained to the AIIC about the poor standard of the report and the clerk' s conduct they brushed me off. This is what you might get using the AIIC.
Agree a photo detailed time and date Inventory given to tenant on Move In and signed by tenant is Our evidence of how a Professional LL operates plus 3 monthly Inspections and on Our Check Out, Inventory is with us and compared and anything that is not fair wear and tear is deducted for no excuses excepted no leeway No Problem.
Just deducted £60 for a Clean as flat not left clean as shown in Inventory. No problem.
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