An inventory is one of the most crucial documents you will have in your possession as a landlord. In order to prevent deposit disputes with your tenant and protect your investment, it is essential that you complete an inventory for your rental property.
The likelihood of a dispute is decided at the beginning of a tenancy, rather than the end. This is because an inventory must be prepared before any tenant moves into the property. During check-in, the tenants should utilise the inventory to walk around the home and note any changes which should be made to the report. During a tenancy, period inspections should be carried out in order to determine if any damage has occurred which is not reflected on the inventory, or if any maintenance is required to the property. At check out, the final condition of the rental property is compared to the initial inventory in order to determine if any deduction should be made to the tenant’s deposit. This can be conducted using innovative technology, such as a letting inventory app.
If you fail to have an inventory in place before your tenants move in, you will not have the evidence you need to provide to the deposit protection scheme should there be a dispute with your tenant over deposit deductions. Inventories are therefore crucial in the adjudication process, and will make resolution of conflict much quicker and easier. The faster the process is when the tenant checks out of the property as the tenancy ends, the smaller the void period will be between tenants, and the less rental income you will miss out on. In addition to this, not having inventory reports could breach the terms of your landlord insurance policy, depending on the type of cover and insurance provider you have chosen.
An adequate inventory report will be unbiased, and composed to a professional level. It should describe and list the condition and quality of the property’s fittings, fixtures, decor and contents for both the exterior and interior of the home. It is vital that the inventory does actually describe the items, rather than being just a list of the items located within the home.
According to statistics, 85 per cent of disputes with tenants involve cleaning, so it is vital to include photographs within your inventory. In addition to this, it is important to include the disclaimers and serial numbers of meters at the property, as well as a declaration page for the collection of signatures on the last page of the report.
It is crucial that the inventory is signed, agreed and checked before the tenants move into the property, and they should use this report to go through each room within the property, as well as to make any appropriate amendments to the report as required. Both parties must then agree to these changes, and include any photographs.
When the inventory report is signed and fully agreed, then the letting agent or landlord can finally hand over the keys to the property to the tenant.
It is also important to note that many claims for deductions to tenant deposits are rejected due to the absence of the tenant’s signature on the inventory report.
As part of a landlord’s responsibilities, they should conduct inspections of the property regularly, in order to ensure that the renter is not breaching their tenancy agreement, and that the property is being well looked after. Periodic inspections will also flag any maintenance issues which need to be resolved, and they should be conducted every three or six months. However, ensure that you provide your tenants with a minimum of 24 hours notice prior to an inspection, and that they give their permission. Landlords should also communicate and document any issues which can be used as evidence later, checking for missing items, damage and cleanliness of the home.
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