Landlords Inventories & Tenancy Deposit Schemes Drift in Inventory Requirement Should Stop

At long last we have had a fairly quiet week in the private rented sector, so this week, I’m just going to jot down some random thoughts on tenancy deposit schemes and inventories.

From the moment back in 2007 when all deposits taken under new assured shorthold tenancies in England and Wales had to be protected in one of the three tenancy deposit schemes it was always likely that the standard of inventory typically carried out by landlords and letting agents was going to need to be raised.

The logic was simple. The deposit is the tenant’s money – which means there should only be a claim on it by a landlord at the end of a tenancy if there was, for example, damage to the property or if it was left in a filthy state.

Deductions cannot be made for fair wear and tear (though some landlords “try it on” and the definition of what’s wear and tear is a little open to debate.)

Of course, before tenancy deposit schemes, tenants always had the option of pursuing unfairly withheld deposits through the “small claims” track in the county court. Many did – and the low cost of this service made it an attractive prospect, though perhaps a little slow, especially if the landlord contested the case.

Faster Resolution of Disputes

The official schemes all contained the requirement that the amount in dispute be held by the scheme (not by the landlord) until the dispute could be resolved. (This is the case even in the “insured version” of the TDS in England and Wales, where though the deposit can be held by the landlord during the tenancy term, any disputed deduction must be paid over to the scheme in the event of a dispute.)

Tenancy deposit schemes speeded up the process for tenants – making it faster for a tenant to claim back an unfairly withheld deposit than would be the case through the courts.

Inventories and Tenancy Deposit Schemes

But one consequence of the schemes was that it meant that it became even more incumbent on a landlord to have a thorough inventory listing the state, condition and cleanliness of everything in the property.

Of course, it was never a good idea for a landlord to just make out a list of furnishings on a piece of paper and get the tenant to sign it and date it.

But, with the schemes in place, such an approach became even more risky because without a thorough inventory, a landlord could not prove the state and condition at the start of a let and so could be forced to return more of a deposit than perhaps was fair.

Drift Needs to Stop

However, today, there does appear to be something of a drift occurring.

For example, I have seen inventories for unfurnished two bed flats run to over 10,000 words with hundreds of pictures and even DVD videos. For me, that is overkill.

And there is also more pressure on private landlords to have the inventory compiled by an independent third party, which inevitably also adds to landlords’ costs.

Partly, this move to more (over) professional inventories is driven by suppliers of inventory services and partly by scaremongering.

At LettingFocus.com, we think landlords organisations need to sit down with representatives of inventory firms and establish what standard of inventory is reasonable and what is “over the top” and then issue some guidance.

Local authorities and housing associations should be involved in this process too because inventory management is also a major part of their work. The drift that we see today should not be allowed to go on any longer.

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