Residential Lettings - Inventories in the UK and the Tenancy Deposit Scheme (TDS)

Inventories in Rental Properties.

An Inventory is essential for any letting these days be it furnished or unfurnished. (If the property is unfurnished it still would normally have carpet, windows, power points etc and all these should be taken into account.) A few years ago it was not heard of to use or even find a professional inventory clerk "north of Watford", but times have changed.

WHAT IS AN INVENTORY ?- An inventory is a binding legal document that provides an accurate written record of the condition and contents of a property at the beginning of a tenancy. It forms part of the contract / Tenancy agreement between a Landlord and Tenant. It is only effective if it is accurate so, all defects and soiling must be noted. Some landlords do not realise that although descriptions can appear uncomplimentary, it is those descriptions that will allow them to prove whether a tenant caused damage or is liable for cleaning costs

Many individuals who let property think that a list of items will suffice, however if you have a dispute with a Tenant and have to go to court, this "shopping list" might be of little use. If you are having a professional inventory prepared, then normally the inventory clerk will supply three copies of the document. These should go to the Tenant, owner and a managing agent.

If you are preparing this yourself you should list the items in room order and give every item an individual number. You should include the following details with detailed comments are shown beside each description: (If you are using a professional inventory clerk they should automatically do this anyway).

• Interior condition and decorative order, plus the fixtures and fittings including: doors, windows, drapes/blinds, ceilings, walls, carpets etc
• Furniture and other contents, excluding items which the Inventory Clerk considers as expendable, such as magazines, living plants etc.
• Gardens are described in layman's terms only. Garden statues, sheds, outbuildings etc will be described as deemed appropriate.
• Lofts, cellars and similar areas are not normally covered.
• Power points and telephone sockets etc
• You should also include the keys and description supplied.

Should a property contain anything considered an antique or of great value the Inventory Clerk must be notified and if possible, ideally, valuations should be provided.

Pre Inventory Cleaning: It is recommended that a property is cleaned to a professional standard for the start of a tenancy paying particular care to carpets, curtains, upholstery, kitchens and bathrooms. If an item is soiled at the start of a tenancy a tenant can not be charged for cleaning it at the end. Landlords are also advised to retain all receipts.

CHECK IN: At a Check in, an Inventory Clerk inspects the property and compares it to the inventory. Any variations seen are noted on the inventory. In many cases when an independent clerk is used they will dictate the inventory and "make it" at the same time as the check in. This is basically because in so man situations there is not time to visit a property and "make" the inventory and then have it typed up in time for the check in when a tenant moves in. If you are making this yourself then you should have time to prepare the inventory ready for the tenant checking in.

If the property has been let before, then normally the same inventory will be used, however if there have been significant changes to the property since the inventory was last used it is likely that a new inventory will be required or an up date.

The 'master inventory' (that agreed at the Check-in) should be kept safe for use at the end of the tenancy or in the event of a dispute. The tenant should be provided with a copy together with a copy of their signature on the declaration page. One copy of the inventory should be handed to the tenants at the time of the check in. If the "make" is done at the time of the check in, the Letting agent or owner should post the inventory document to the Tenant asking them to acknowledge safe receipt of it in writing and let them know in writing within so many days if they do not agree with any of the comments.

It is also advisable to write to the Tenant when they move in with the following advice:

"NOTES ON AVOIDING PROBLEMS DURING AND AT THE END OF TENANCIES

It is suggested that you familiarize yourself with the obligations you are responsible for under the Tenancy Agreement, particularly regarding Rental Payments, Cleaning, Gardening, Noise and Pets. You must pay rental right up until the end of tenancy, unless you have a break/release clause in the agreement. Under the terms of your tenancy, the deposit cannot be used to pay rent.

Please can you pay particular attention to the following:

Carpets, Curtains You will be responsible for leaving the property in a good and clean condition at the end of the tenancy. When the inventory agent checks you out fair wear & tear is taken into consideration. You should have the carpets and property professionally cleaned and it is advisable to retain any receipts for this work. Be very careful laundering curtains, because if you accidentally shrink or damage them, you will be charged for replacements. If in doubt seek professional advice before cleaning them.

General Cleaning It is a good idea that your cleaners pay attention to dust on skirting boards, condensation stains on windows, frames, light fittings, and bathroom fittings, kitchen cupboards etc. Windows must be cleaned regularly and unless you are in a block of apartments the external glass as well. If you do not want to do this, please employ a window cleaner. Ensure that the tops of kitchen cupboards are cleaned. Cookers, grills, oven are clean including under the hob rings. Remember that fat can splash down the sides of cookers. Fridges and freezers should be defrosted regularly throughout the tenancy. This ensures they perform better and ice does not obstruct the opening & closing of compartment doors. Beware of washing paintwork with bleach and make sure that lime scale build up is regularly removed from toilets.

Chimneys Please make sure that these are swept annually, the best time will be after the winter, but under the terms of the tenancy, if there is a working fire at the property, You should retain receipts from the chimney sweep.

Decoration & wall surfaces If you need to touch up paint during the tenancy or at the end make sure you are using the correct colour and texture. It is no good touching up vinyl silk with vinyl matt. You must obtain consent if you want to hang any pictures etc. If walls are badly marked, you could be charged for redecorating all the room. You must not carry out any redecoration (other than that described above) with out the written consent of the Landlord. Please take great care when moving furniture about, or when your removal contractors are moving your belongings about. We have found from experience that much of the damage to decoration and doorframes is caused by boisterous children or badly trained pets. Please also take great care with your Landlord's furniture.

Defects of the property You must notify the Landlord or Managing Agent about any defect at the property, or if equipment does not work. You should not call out a contractor yourself to repair an item, unless you broke it and would be responsible for payment.

Gardens Unless there is not a garden or the Landlord is employing a gardener, you are responsible for keeping the garden in good condition. If the garden is not properly maintained a professional gardener will be employed to put it right and you will be charged. If you are unable to undertake the work, we advise you employ a professional gardener.

Outbreak of fleas, vermin or similar household pests etc If there is an out break of household pests one month after the initial tenancy, it will be your responsibility to have the problem attended to.

Guttering, drainage pipes and cold weather precautions Please remember you are responsible for paying for the unblocking of waste pipes, keeping guttering cleaned (unless in an apartment) and ensuring the pipes do not freeze up in the winter months. Be very careful not to put boiling fat down sink drains and to clean out gutterings in the autumn. If you leave the property in the cold weather, keep the heating running and if you are going to be away for a few days have the entire system professionally drained down, It is no good just turning off the cold water supply if there is still water in tanks and radiators."

CHECK OUT: - At the end of the tenancy a Check out inspection is carried out. Notes are made on the 'master inventory' of any variations since the Check in. An inventory clerk will then list the significant differences on a Check out report.

Cleaning is often a major area of dispute. Landlords and tenants are advised to retain all receipts relating to cleaning and repairs carried out before or during a tenancy. It should be noted that an Inventory Clerk cannot comment usefully on any alterations or additions made after the Check in unless he/she was instructed to revisit the property in order to examine these changes at the time they were made.

A useful aide memoir is send a tenant a letter a couple of weeks before the moving out /check out date with the following information in it "Professional cleaning The following is a description of what professional cleaning entails which has been provided by a professional cleaning company and may prove helpful prior to your check out being carried out.

KITCHEN Sink taps de-scaled and cleaned, sink cleaned. All wall tiles cleaned and polished. All paintwork washed an all worktops cleaned. All cupboards cleaned inside and out. Floor cleaned

COOKER Degreased and cleaned including all shelves and dishes, extractor fan degreased and cleaned.

FRIDGE Cleaned inside and out and defrosted.

WASHING MACHINE Cleaned inside and out, soap dispensers removed if possible and cleaned.

Any other appliances cleaned

BATHROOM All taps de-scaled and cleaned, sink and bath cleaned. Toilet de-scaled and cleaned. All wall tiles cleaned and polished. Any other fittings cleaned. Floor Cleaned.

ADDITIONAL ROOMS All other rooms paintwork washed. All carpets cleaned and stains professionally removed if possible. All furniture cleaned and polished. Upholstery cleaned upon request."

The Check-out report is the basis for most claims made by landlords. A claim is most often viewed more favourably if compiled by an independent and unbiased party such as an Independent Inventory Clerk, particularly in a Court of Law.

Another area of major concern is "Fair Wear and Tear" - This has been defined in part through the legal process. A tenant cannot be held responsible at the end of a tenancy for changes to a property's condition caused by what the House of Lords has called "reasonable use of the premises by the tenant and the ordinary operation of natural forces (i.e. the passage of time)." A professional inventory clerk uses experience and common sense to assess the many factors present before reaching a judgement as to how much should be allowable for Fair Wear and Tear. Amongst other things they will consider:-

• The quality of the supplied item (and that varies greatly)
• The condition at the start of the tenancy
• The condition at the end of the tenancy
• Any extenuating circumstances

It is important to realise that the Law does not allow for betterment. This means that a landlord can not expect to have old replaced with new at a tenant's expense. A Fair Wear and Tear allowance must be considered. A tenant has a duty of care to return the property at the end of a tenancy in the same condition, Fair Wear and Tear excepted, as that recorded on the Inventory at the start of their tenancy.

Decorations have an accepted life expectancy. However, there may be circumstances where excessive wear and tear require a tenant to pay compensation or charges to make good, e.g. numerous nail or picture pin holes, torn wallpaper, gouges in walls/woodwork etc. Charges for cleaning, making good etc are often apportioned to account for Fair Wear and Tear.

Example: A tenant renting a property and the inventory from the Check in inspection notes that the carpet in the living room had not been freshly cleaned and had a few spot marks. At the end of the tenancy, the Check out report notes the carpet as soiled. In this scenario the landlord should not be entitled to full compensation for the carpet cleaning costs. A fair solution would be for the tenant to pay a percentage of the cleaning costs which would be calculated by a professional Inventory Clerk

Remember, without an inventory report it may prove difficult for a landlord to make a successful claim against a tenant for damage repair or cleaning costs. Tenants should also be aware that if an inventory does not include sufficient notes on the condition of items at the start of the tenancy, they may be charged for damage or cleaning that is not their liability. To ensure that end of tenancy negotiations can be dealt with quickly and easily it is best to make sure that:

• A full inventory is prepared before a tenancy starts
• The inventory is checked very carefully during the Check-in inspection and agreed by both parties
• The Check-out inspection is thorough and any items that may lead to claims are witnessed.
• If you use a Professional Inventory Clerks, they are carrying this out as their business and spend all day every day inspecting properties to make sure that there is sufficient written evidence to protect landlords and tenants.

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FACT FILE - Tenancy Deposit Scheme(TDS) - UK

In the private sector many tenants have been giving their landlord a deposit against possible non-payment of rent or damage to property. When a tenancy comes to an end, if there is a disagreement about the return of the deposit, much hardship and inconvenience is suffered by both the landlord and tenant.

The Tenancy Deposit Scheme (TDS) means that as from October 2006 deposits will have to be placed in the authorised Tenant Deposit Scheme. These will either be in "custodial" or "insurance" schemes which will be run by independent third providers. These schemes will be able to help resolve disputes. Landlords who take deposits will have to join a scheme. If they don't they risk having to pay a penalty of three times the deposit to the tenant.

In the Custodial scheme landlords will pay deposits into an account where it will stay until the tenancy ends, when either party can apply to have it returned. Once the landlord and tenant agree on how it should be split the scheme adminitrator pays out.

The insurance scheme is more complex in that the deposit will be kept by the landlord on the basis that when the tenancy ends, the amount agreed between landlord and tenant will be paid out to the tenant.

The insurance only comes into effect if at the end the tenancy the landlord doesn't pay back part or all of the deposit. If this happens, the tenant can ask the administrator to step in and the landlord will have to pay the amount in dispute into an account until the dispute is settled. The insurance will pay out if the landlord fails to pay the deposit into the account.

N.B. This information should not be relied on for accuracy and is presented here without the responsibility of jml Property Service and the website it is being displayed at. ©jml property Services 11-05

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