Risky Rental MarketWith this headline in mind found on the ‘communities.gov.uk ’ Website, I attended an annual meeting of a well-known Letting Agent Association this week, and apart from being impressed with the level of professionalism and commitment demonstrated by organisers and members, I was struck by a common theme being discussed – that of standards and regulation.
“The private rented sector plays a really important role in the housing market … it's crucial that we have a high quality sector that works well for both landlords and tenants …” says Margaret Beckett MP, and I agree. Maybe it’s time we collectively grab this growing market opportunity and help shape its future in a way that benefits us, before government steps in.
Being responsible for policy within a large inventory clerk team, I’ve argued for some while that we should have an agreed standard for inventories within the lettings industry. This should be one which dictates how an inventory clerk works and how an inventory is compiled, including what it should contain and how it should best represent a property and its contents.
Even though the TDS - sometimes known as an ‘evidence based scheme’ - has been in situ for 2 years, still, some landlords believe an inventory is of minimal worth, until a dispute occurs of course and their claim is dismissed on grounds of inadequate evidence, or in some situations, no evidence.
Of the many check-out inspections we complete annually, I see inventories compiled on as little as Post-it notes or scraps of paper. Even if they are of substance, they sometimes have no consistency or standard which makes check-outs difficult to complete. Remember that an inventory has only one purpose – that of providing one with something to work with at check-out when the tenant vacates.
It’s no wonder there is a high percentage of failed landlord claims. If we find it difficult to ascertain changes between tenancy start and end, then adjudicators must also find it difficult.
For the moment I feel we should not get too ‘hung-up’ on what is a good or bad inventory, but to remember that an inventory must list everything, because without adequate evidence of a properties’ original condition and content, how could one judge whether a claim is valid or not?
Ongoing however is the problem of standards. There is no inventory standard, and there is certainly no regulation or regulatory body for inventory clerks. Yes there are a couple of associations and there are some organisations marketing themselves as ‘the authority’, where they get that from I don’t know!
As one line of the Rugg review indicates “introducing a light touch licensing system for landlords and mandatory regulation for letting agencies…” could mean change may be on its way, whether we agree or not, and for inventory providers as well.
Now I know the idea of regulation sends shivers down the spines of many. It is not unusual that regulation, especially if dictated by the government, is sometimes poorly planned and implemented. However with the advent of the TDS and the more recent Rugg report, I think we can safely expect a change in the way some of our industry operates, and would it not be best that industry, with its many committed professionals, helps in shaping such regulation?
With the PRS growing, I believe it’s time that some elements of our industry acquire greater responsibility in shaping standards. As I saw with such commitment shown by people at this recent meeting, I can see how industry can help set standards without too much wisdom from Government.
In the mean time before any of us are to help set standards, I think it right to say that a good inventory is essential at start of any tenancy.
Such an inventory in our view, is one which lists each component of a property and it’s contents, describing each in terms of colour, construction and importantly, what it’s condition is, that is, is there anything wrong with it or not.
It must be factual and list ‘as we see’, without too much personal opinion or personal view on what’s right or wrong and what the landlord or tenant should or shouldn’t do.
Each item would usefully be numbered, as in a numbered list so as each can be identified more clearly at check-out, and where possible, it should have structure and order and written in easily understood ‘English’, and finally where possible an inventory would include pictures. An inventory should finally be agreed by the tenant, and signed and dated.
Here’s a thought for the moment, when securing a tenant’s deposit, remember ‘the natural path of a tenant’s deposit, is back to the tenant, unless the landlord can prove different’.
‘If it isn’t listed, it can’t be claimed for’.