In this weekend feature, inventory expert and chair of the AIIC, Daniel Evans, sets out why rental reform changes will make inventories more important than ever.
The impending changes to the rental sector, set out under the initial Renters’ Reform Bill and then the Levelling Up White Paper, and expected to be fleshed out in the long-awaited White Paper on Rental Reforms (anticipated to be released this spring), are aiming to change the market for the better. But they have also proved divisive.
The primary proposals include the abolition of Section 21 as well as the potential introduction of lifetime deposits, the implementation of a landlords register, ensuring all homes meet a Decent Standard and further steps designed to clamp down on rogue landlords
To make these changes manageable and strengthen the confidence of all parties involved, inventories can be relied on as evidence that can make these impending changes far easier to comply with.
Independent inventories cannot be overlooked
Rental reform changes show that reliable practices need to be put in place to prevent letting agents and landlords from bearing the brunt of unnecessary costs and losses.
Inventories demonstrate the condition, cleanliness, and contents of a property during the beginning and the end of a tenancy.
These contain specific evidence about fixtures and fittings, décor, furniture, and overall condition of the items included in a rental home. This is logged in the form of written, video and photographic proof.
Then, at the end of the tenancy, comparisons of the home at the beginning are made with it at the end, to clarify whether the tenant is liable for any expenses.
Inventories can be carried out by landlords, letting agents or independent inventory clerks. Insufficiently completed inventories could be as bad as not having one at all, as too little information is worthless when it comes to proving the condition of a home.
However, an independent inventory is less likely to miss out on vital details and generate a fair and unbiased outcome.
Having all this key information at your fingertips means letting agents and landlords can decrease the chances of needing to evict at a later date, as the likelihood of disputes will be lessened. What’s more, inventories will help to ensure that homes meet a Decent Standard before being let out, and will no doubt play a key part in any lifetime deposit system as well.
Abolition of Section 21 means core evidence is vital
With rental reform set to remove Section 21, it could be harder for landlords to evict, but by having a good inventory in place to begin with, the likelihood of disputes is lowered, and this makes evictions less prone to happen.
The abolition of Section 21 is likely to make the eviction process harder for landlords, as it could grant tenants the right to stay in a property unless they breach their tenancy agreement. There are proposals for beefed-up Section 8 notices to replace Section 21, but many in the industry have complained that these notices are much less effective and much more of a blunt tool.
To lower the chances of needing to use any eviction notice at all, letting agents and landlords must put effective measures in place to protect themselves. Inventories are one big solution as they safeguard, provide core evidence, and improve transparency.
Inventories are based on facts only, making them form vital evidence that ultimately results in a fair decision. Issues with the home that existed before moving in can be proven by tenants wanting to file a complaint. While landlords and letting agents can use inventories to disprove untruthful claims.
Overall, this vital piece of evidence will increase the confidence of tenants, landlords, and letting agents during the let or in a court of law if deposit disputes occur.
Lifetime deposits need to be supported by inventories
The White Paper on Rental Reform, which is expected to be released this spring, should further explain the introduction of lifetime deposits. This process, if implemented, could mean that tenants can move house without transferring the new deposit to the new landlord as the previous deposit is already included.
Although this sounds simple, there is room for inaccuracies to occur, particularly as all deposits do not get returned to the tenant.
The deposit is only returned if sufficient evidence proves that there are no issues with the home while landlords are only given the funds if enough proof justifies that the tenant caused damage.
It is likely that any lifetime deposit system will need to work alongside inventories to ensure that any deductions as required can still be made, even as deposits move more easily from tenancy to tenancy.
Of course, for the moment, we’re still dealing in hypotheticals and speculation – so we all have to cross our fingers that the White Paper on Rental Reform finally sees the light of the day before spring is out. That way the whole industry will have a much clearer idea of its future direction.
*Daniel Evans is chair of the Association of Independent Inventory Clerks (AIIC)