A full rental inventory should be taken before every tenancy. This is a thorough and detailed record of the condition of your rental property and its fixtures and fittings. An accurate inventory helps to assess any damage or loss caused by an outgoing tenant that will need to be covered by their security deposit.
An inventory will be cross referenced against a check out report when a tenant leaves as evidence to support a claim. The introduction of the Tenant Fees Act means landlords and letting agents can no longer charge for a check out report, but they remain a vitally important part of protecting your investment.
A full inventory process should consist of:
• recording the condition of the property, (the ‘inventory’ – see below), immediately before the tenancy starts
• getting the tenant’s sign off on this record of condition to make sure they agree with the property’s condition (the ‘check in’)
• recording the condition of the property at the end of a tenancy (the ‘check out’)
It’s not only important to take an inventory, it’s important to do it properly. An inventory should not be a hurried five minute dash around the property, with notes scribbled on the back of an envelope. This document needs to be able to stand up in court should a dispute ever get there – a good inventory can run to as many as 50 pages.
There are many examples of an inventory template online, although it could be a good investment to hire an independent inventory service. Costs vary depending on the size of the property, but getting in a professional could save you time and money in the event of any disputes. It will also put some distance between you and the tenant and will prevent any accusations of bias should there be any issues.
What should be covered in an inventory:
• Furniture, fixtures and fittings – should be listed with a description of their condition, noting any wear and tear. Written descriptions should be supported by images or video
• Be sure to include the condition of carpets, walls, cupboards, windows, bannisters, ceilings
• Smoke/carbon monoxide/burger alarms – these should all be tested and have the supporting certificate
• Fuse boxes – inspected and logged
• Fire label regulations – ensure all furniture in the property complies with the fire regulations
• Appliances – make a note of the model and make
• Garden/outside areas – note the condition of any outdoor space, including fences, drive way, garages and include the tenants’ duties to maintain it as per the tenancy agreement
• Meter readings – these should be noted and time-stamped. Take a picture of electricity and gas reading as proof
• Agree on ‘fair wear and tear’ – tenants can’t be held responsible for reasonable deterioration that comes from simply living in a property, this holds especially true for long-term tenants
Inventories work two ways, they’re not about solely holding the tenant accountable, but also serve to highlight the responsibilities of the landlord or letting agent. A survey of landlords and tenants conducted by ComRes on behalf of Citizens Advice in June 2019 found three in five tenants (60%) identified disrepair in their home in the last two years that was not caused by them and that their landlord was responsible for fixing. One in six (15%) said the disrepair was a major threat to their health and safety.
By flagging pre-existing damage in a property, you will be showing your commitment to the process which helps to build trust with a tenant. By keeping your side of the bargain and showing that this is a two-way deal, you could help prevent disputes over the inventory at check-out and leave no room for tit-for-tat style arguments – for example, if you’ve never fixed the mould in the bathroom, the tenant is more likely to be disgruntled at having to pay for that wine stain on the carpet.
Consider using a specialised independent inventory clerk.
Hiring an inventory company will ensure there can be no accusations of bias. As deposits are held in a third party scheme the burden of proof lies with the landlord should a dispute get to court, so you need to ensure you have a strong a case as possible. Using an independent inventory clerk means any evidence you may need to supply in order to make a claim on a tenant’s deposits will be objective and reasonable and put you in a stronger position.