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?in England, 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.
To minimise costs, most inventory clerks include items which are of little real value in general terms i.e. "a quantity of .etc..". Examples of such items are books, tired bedding, used kitchen utensils/tableware etc. You will find that if you are using a professional inventory clerk, that naturally you will pay more for the make if for example you have left your book library in the letting, as every book would have to be listed.
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.
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 a reminder to make sure the property has been properly cleaned.
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 & 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. If you are not using a professional inventory make your inventory as thorough as you can.
Philip Suter is a Director of JML Property Services - http://www.jmlproperty.co.uk - a UK based company offering Insurance products on line and a holiday home advertising service and management training with in the uk. He is a very experienced property consultant with over 30 years work in the Residential letting business and served in the national council of ARLA. He is a Fellow of the National Association of Estate Agents (NAEA) and a Member of The association of Residential Letting Agents (ARLA)