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How can a Landlord fairly assess damages at the end of a tenancy?

Posted by Terence Stencel on Thursday, July 19, 2012 Under: Landlord Articles

The tenancy has ended and the check out report processed. You (The landlord), having viewed the report, see that the two of the bedroom walls in your property have been found with multiple sticker marks and extra picture hooks. In your tenancy agreement there was provision for the tenants to put up a maximum of 3 picture hooks per room. The walls were all newly decorated just before the tenants moved in. The tenants have put 4 picture hooks in one room, 9 in the other, and one of the bedroom`s has approximately 100 sticker marks scattered throughout.

So how would you resolve this situation fairly? The first thing that may come to your mind is that all the walls need repainting, and the tenant should be liable for this. As this may be true for the bedroom walls that has been degraded by the sticker marks and hooks, there is a few things you should bear in mind first.

You may have heard of the term Betterment. Let`s start with the tenant. It is a principle of law that the tenant does not need to leave the property in better condition than in what he found it at the start of the tenancy. Additionally, it is extremely important that the landlord takes fair wear and tear into account before considering the claim.

Betterment in relation to the landlord would mean that you (as the landlord) have no obligation to replace any item with an item of a higher value. For example the fridge breaks down during the tenancy and the tenant requests a new one. The landlord in this situation would only have to replace a fridge of the same value.

Reverting to the example of damages above. Sticker marks and the extra picture hooks are certainly not fair wear and tear. So how would you calculate a fair sum for the tenant to pay? Lets throw a few equations into the mix.

The tenants have lived there for 3 years. They consisted of two couples. The expected lifespan of the bedroom walls after they were newly painted is approx. 5 years. So depreciation needs to be taken into account. The potential lifespan of the walls is still a further 2  years. You have done some calculations and to redecorate the room will cost £200.

THE FORMULA

A - Useful lifespan of the decorations to that room                5 years

B - The age of the decorations at the end of the tenancy        3 years

C - Potential remaining lifespan of the decorations                2 years (a minus b)

D - Cost of redecorating the room                                          £200

E - Depreciation of value                 (D divided by A)            £40 per year

F - Liability for the tenant                                                       £80 (E multiplied by C)

So in this case, £80 for the room with stickers would be fair plus a additional amount for filling the holes (from the picture hooks).

There will also be a time when a tenant damages a fixture, fitting or item but it does not warrant complete replacement. For example, The tenant has recently checked out and after viewing the check out report, you notice 3 small candle burn marks have been noted to the reception carpet. If the stains or marks are not big or large enough to qualify for carpet replacement, the landlord would have to accept compensation for reduction in the value of the item. However, if the carpet was completely ruined by stains, marks etc., the landlord could certainly claim for replacement, but would still not be able to claim the full replacement cost due to depreciation (age of the carpet at the end of the tenancy). A goodly amount could still be claimed though depending on the age of the carpet.

References : A guide to best practice for inventory providers - ARLA Asset Skills NAEA RICS 2007 including 2011

In : Landlord Articles 


Tags: "fairly assess damages at the end of a tenancy""check out report""fair wear and tear""end of tenancy" 
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