Deposits and inventories – are you up to speed?

June 4, 2012

Landlords Insurance

Deposits and inventories can sometimes be something of a headache for landlords and tenants alike.

Here are some of your questions but remember that some of these relate to legal matters and you may need to seek qualified legal advice in some cases.

Can I deduct the cost of damages from the deposit prior to return?

This is a complex question and some caution is required.

In theory, yes you can – but be warned, changes in legislation now mean that it is far easier for tenants to challenge these deductions.

Ultimately, the law does not allow you to act unilaterally and be your own arbiter.

You may have to prove that something has been damaged before you will be allowed to keep a percentage of the deposit as compensation.

Doesn’t the inventory do that for me?

Possibly but the inventory is only as helpful as you make it.

To be useful to you in a dispute, the inventory not only has to list an item but also its condition.

To give an example, if your inventory simply states that a cupboard is present but you find it is badly damaged at the time the tenants vacate, they may simply be able to say that it was in a poor condition when they moved in.

Your inventory will prove nothing unless it described the cupboard and also stated that it was in good unmarked condition etc.

Your inventory may also come in handy to support your let property insurance quote valuations.

So, all I need is an inventory?

Not quite!

An inventory that is just a printed list of items and their conditions may be next to useless to you if, in a dispute, the tenants simply say that they’ve never seen it before!

What is important is:

  • that each page (perhaps even each line) of it is signed or initialled by the tenants before you sign the rental agreement and they move in;
  • that it is explicitly cross-referenced in your tenancy agreement, which then goes on to confirm that the tenants will agree your right to withhold monies for repair/replacement.

The above steps won’t guarantee that you’ll avoid troubles or win any appeals but it may significantly increase your chances of so doing.

 

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