Honourable and personal residential letting experts

Resident ‘Check-Out’  – End of Tenancy Report and Negotiations

The purpose of the End of Tenancy report is to take back possession of your property from the residents and make sure you can assess and evidence any costs they should meet.

The key is any deduction needs to be ‘agreed’. If the resident does not agree, they can refer the case for external adjudication. As this takes time, costs Owners money and rarely awards an Owner everything they claim, we ensure the focus of the end of tenancy report is to provide evidence to support any claim.

What is involved producing the End of Tenancy Report?

We visit the property after the end of the tenancy to check the condition of the property. We make detailed notes in every room against the original inventory and take clear pictures of any issues where we feel attention is needed.

We then take end of tenancy meter readings and take back keys from the resident, checking they are correct. At this point the resident is no longer responsible for the property and cannot gain unsupervised entry again.

We then compare all our notes and photographs with:

  • The inventory from the start of the tenancy
  • Any periodic visits or safety compliance visits
  • Any relevant maintenance works completed
  • Any correspondence with the residents

With the aim of assessing whether any items are the Owners’ responsibility – e.g. periodic maintenance or replacement; or whether the Resident is responsible.

If so, we then assess what would be a reasonable deduction, taking into account all issues, such as age, condition at the start of the tenancy, tenancy length etc.

What can I claim from the residents deposit?

Ultimately whatever you can agree with the resident! However, if an external adjudicator is involved the type of things you can claim for are:

  • Damage – provided it is adjusted for wear and tear. E.g. internal decorating is expected to last around 5 years. If a resident has been in tenancy for more than this, it is unlikely an adjudicator would agree any deduction for decorating unless the resident had cause unreasonable costs.
  • Missing items
  • Removing and storing items left in the property
  • Cleaning – but only to the same standard as shown on the inventory. A ‘professional clean’ can’t be imposed.
  • Unpaid rent
  • Unpaid bills – e.g. utilities
  • Compensation for tangible costs you’ve incurred because of them e.g. clearing a blocked drain caused by resident but for which they refused to accept responsibility for at the time.

All of these would need clear evidence and cost evaluation.

The adjudicators have guideline calculations and adjustments for each type of issue – as far as possible our aim is to match these, to maximise the chance of success if there is an adjudication.

For more details see our page on end of tenancy deductions

What happens with the End of Tenancy Report?

Initially we advise the Owner of our findings and recommend the deductions we feel are viable, with reasons. The Owner can then make their own comments, so we end up with a shared view on the proposed deductions from the deposit.

We then submit all the evidence to the resident to support the proposed deductions e.g. the inventory, tenancy (highlighting the relevant clauses), end of tenancy report, photographs, contactor quotes and invoices.

There is then a period of negotiation between the resident and us to reach an agreement. In some cases the figures are agreed reasonably swiftly, in which case we formalise the finances, allocating to Owner, Resident and any contractors, plus properly registering the change with the Deposit scheme.

Unsurprisingly there are often significant differences of opinion with residents, so the strength of our evidence is important. Even so, some residents are not prepared to cover much, or even any, of the proposed costs, which can lead to extended and lengthy negotiations.

If this happens, we try various options to reach an agreement, but ultimately some residents will not change. In which case there is a formal dispute.

What is a formal dispute?

Any deduction from the deposit needs to be ‘agreed’ by the residents.

If not agreed residents have the legal right to seek free adjudication by the relevant deposit protection scheme of any proposed deduction. The adjudicators all compare the evidence based on:

  • A decent photographic inventory properly agreed at the start of the tenancy
  • The photographic end of tenancy report
  • The tenancy clauses

To assess whether the residents are responsible for any issue.

After assessing responsibility, they will assess the scale of the deduction, for which they will consider:

  • The clarity of the evidence
  • The age of the item
  • The cost of the repair/works/replacement
  • What is reasonable ‘wear and tear’ (for which they have heir own guidelines of ‘life expectancy’ of various items)
  • Any seasonal consideration for garden growth

They combine these to assess whether the proposed deduction is fair.

Even when the evidence is very clear we have found the adjudicators tend to err in favour of the residents – and they can take several weeks to reach this decision.

Producing all this evidence to inform the adjudication can also take a significant amount of our time, for which we need to charge.

Given this, we strive to reach an agreement directly with residents where possible and would advise avoiding a dispute unless the proposed deductions are significant and the evidence is strong.

For more details see our web page on deposit disputes.

Why is this service chargeable?

Average tenancies are now nearly 40 months, a figure that has been growing for some years. This reflects the fact Owners are improving their properties to make it more likely they get long term stable tenancies. Sadly despite this, there are a minority of tenants who choose to leave sooner, or not live within the terms of their tenancy. Inevitably these cause a spike in workload, meaning a spike in costs.

Rather than continue to share these costs across all owners, the majority of whom have long term stable tenancies, we charge these costs to the Owner affected.

Based on an average tenancy, the charge of £250 equates to just £6.41 per month.

We have also experienced some owners seeking unsupportable claims from residents deposits. If our advice about justifiable claims from the deposit is not followed and negotiations become extended we will add our £60 hourly charge for the extended negotiations.

Do I have to have an end of Tenancy Report?

No. The main reason for doing the report is to enable evidence to demonstrate any proposed deduction from the deposit is reasonable.

Many owners consider that once a resident has been in tenancy for 5+ years with every indication being they have looked after the property, the Owner is not expecting to make any deductions and is therefore prepared to accept the risk that a detailed end of tenancy report is not needed.

The obvious risk is that there are significant costs that are not apparent until the residents have left. Even if there are, if the resident seeks external adjudication of any deduction, then the length of the tenancy means any adjudicator is likely to assess wear and tear will account for most issues except significant damage and cleaning costs.

Given this, combined with the deposit being limited to 5 weeks’ rent, some Owners accept they are prepared to forego the chance of making a claim against the deposit and accept any costs as part of the preparation for the next resident, particularly if the previous residents have been otherwise good tenants for some years.

If this is your situation, you do not need the full End of Tenancy report service, but you will need to consider the following section.

 

What will I need doing if I don't have the End of Tenancy Report service?

If you decide you do not need the End of Tenancy Report service then the following will need to be covered

Relating specifically to the deposit:

  • Resolve any deductions with your resident and ensure these are agreed – assuming you intend to make any deductions
  • Handle and evidence any adjudication required by the deposit protection scheme
  • Confirm to us the agreed deductions, with the residents full bank details and evidence they agree with the deductions so we can return any remining deposit

General aspects of the tenancy changeover:

  • Notifying utilities of the change of tenancy from the old residents to the Owner, who is responsible for the utilities between residents. We can collect final meter readings and notify the various utilities for £60 inc. VAT
  • A clear schedule of works to prepare the property for new residents, allowing 2 working days before your new residents for a pre-tenancy clean and inventory, which will need arranging in advance – this is included if you have our Tenancy Management or Concierge services, otherwise this is charged at £75 inc VAT.
  • Updating TDS deposit protection scheme with the change of resident and details of the deposit conclusion – we will cover that as part of our annual TDS charge, provided you notify us of the outcome of the deposit discussions

Please get in touch if you have any questions or concerns