The calculation of compensation charges at the end of tenancies is the holy grail of lettings, and getting it wrong can lead to unnecessary disputes with tenants, says the Association of Independent Inventory Associations (AIIC).
As landlords and agents are responsible for calculating the cost for compensation charges against a tenant, they must ensure they are being fair, however as the AIIC points out, everyone involved has different expectations.
Landlords and their agents should have a working knowledge of accepted principles in order to avoid disputes and need to clearly explain to their tenants how they have worked out the compensation deductions.
Pat Barber, Chair of the AIIC, said: “If agents and landlords can prove how they arrived at the proposed deductions from their tenants’ deposits, all parties involved will be happier to accept the decisions. Fewer disputes cause less headaches in terms of wasted time, money and effort all round.
“There are a few bits of information that agents and landlords need from the start to aid their calculation, namely the original cost of an item; age and condition at time of check in; length of tenancy; average life expectancy of the item; and any extenuating circumstances.”
Floor coverings can be a major issue for landlords, agents and tenants as recent research indicates that accidental damage to flooring is the main cause of insurance claims for tenants (42%).
Barber added: “For example, if a tenant damages vinyl or laminate flooring with drag marks, deep scratches or scrapes, burn marks and stains, these are considered to be chargeable issues. A small number of surface scratches, ‘nicks’ and minor indentations are considered to be consistent with fair wear and tear depending on the length of tenancy and original condition.
“It is always recommended that care instructions for surfaces such as vinyl and laminate floors be provided to the tenant by the landlord or agent. Laminated flooring can vary in quality from surface ‘photo’ coatings to a thicker laminate top layer. Laminates with a thin surface coating are prone to edge lifting, although excessive washing can also exacerbate the problem and could be chargeable if this can be proved.”
