Deposit scheme releases inventories guidance to avoid checkout disputes after tenant fee ban

March 27, 2019

From Property Industry Eye

The Tenancy Deposit Scheme (TDS) has teamed up with Propertymark and the Association of Independent Inventory Clerks to compile guidance on the check-in and check-out process for tenants.

TDS said its guide provides clarity regarding deposit deductions and disputes for agents and landlords who may have previously relied on outside bodies completing reports for them on the basis that the tenant would be covering some of the costs for the checks, which will no longer be the case once the fee ban is introduced in June.

The guidance states that more than 60% of TDS disputes involve cleaning, so suggests that a “clear understanding” of cleanliness at the start and end of the tenancy is critical.

References to items being “new” or “professionally cleaned” need to be supported by an invoice reflecting this, TDS said.

Agents and landlords are encouraged to highlight both the condition and cleanliness of a property at check-in.

TDS said: “Whilst the check-out report may list cleaning issues at the end of the tenancy, if the check-in report comments only on condition, an adjudicator will be unable to determine if the property’s cleanliness had deteriorated during the tenancy.”

The report adds that wording such as “professionally cleaned” or “cleaned to domestic standard” are preferable to coded abbreviations or a numbered scale.

Descriptions such as “bright and breezy” or “sparkle clean” are not considered useful and are best avoided, TDS said.

The report suggests high quality photographs are useful for the inventory and check-in but only as an addition to the written word.

At check-out, TDS said, the reader of the report needs to be able to understand easily what has changed at the end of the tenancy.

It said: “This is as true of a landlord, agent or tenant reading a check-out report as it is for a TDS adjudicator.

“The purpose of the check-out report is to identify obvious or significant discrepancies in the property’s contents, cleanliness and condition. Tenants will not be responsible for fair wear and tear, which must be assessed on the length of the tenancy and the type of occupancy.”

Michael Morgan, director of dispute resolution at TDS, said: “TDS understands the concern of members on the issue of inventories as a result of the incoming tenant fees ban.

“However, we take the view that we serve the interests of all parties to a tenancy best by considering check-in and check-out reports based on their content rather than who compiled them.”

David Cox, chief executive at Propertymark, said: “The tenant fees ban will have a profound impact on the whole industry, but the sector must not underestimate the importance of a thorough inventory.

“They provide certainty for all involved, add clarity at the end of a tenancy, and help resolve disputes. In the new world after the tenant fees ban comes in agents will need to take an evidence-based approach to default fees, damages and disputes.

“Only by ensuring that an inventory took place can agents protect their clients’ investments and reduce costs in the long-run.”