Wear and tear in buy-to-let apartments can be a particular bugbear for landlords. And yet, it's pretty much unavoidable. A fair amount of wear and tear should be expected once a tenancy has finished. But tenants also shouldn't be deemed responsible for natural wear and tear that occurs when they live in a property for a sustained length of time.
So what happens when wear and tear isn’t so fair? Sometimes tenants cause damage to the furniture, fixtures, and fittings or other aspects of the apartment. When this happens, they are liable to pay for damages under the stipulations of the tenancy agreement.
This is when landlords need to differentiate between what is considered typical wear and tear and what is serious damage caused by the tenant. It’s also essential that they understand the costs of wear and tear and what can and can’t be claimed as an expense.
In this article, we'll explain how to define apartment wear and tear in your buy-to-let. As a result, you will have a thorough understanding of how wear and tear works and be able to handle any issues that may arise.
Over time, the fixtures, fittings, and furniture in a property experience natural wear and tear. The longer a property is in use, the higher the chance of fair wear and tear occurring. Some of the items that typically fall under the fair wear and tear category include:
Deterioration to these items is hard to avoid, and it’s unreasonable to expect tenants to pay for them. Normal everyday use means there will be some form of decline to the property, and landlords are responsible for getting it back into shape before the new tenant moves in.
The costs of fixing wear and tear are usually minor. For instance, a fresh coat of paint and the replacement of bathroom taps and showerheads. It’s rare for a buy-to-let apartment to start a tenancy with a new renter without any minor cosmetics required.
While some slight wear and tear is to be expected, there are times where things are beyond basic repair and the fault lies with the tenant. A few scuffs to the wall is standard, a huge dent isn't. Essentially, the tenant is responsible for paying and fixing the wear and tear when actual damage is caused.
This can include:
Unexpected damage is often the tenant's fault. At this point, the landlord needs to decide whether or not they hold the tenant liable for damages and deduct the costs from the security deposit accordingly.
Tenants also have the option of taking out Tenants Liability Insurance, which covers them against accidental damage. This includes any fixtures and furniture owned by the landlord.
Defining wear and tear brought on by natural causes and direct damage from the tenant can be tricky. It won’t come as a surprise to learn that wear and tear is one of the biggest disputes between landlords and tenants.
The whole scenario is somewhat of a grey area, with the AIIC (Association of Independent Inventory Clerks) defining typical wear and tear as when “a tenant cannot be held responsible for damage caused by reasonable use of the premises and the ordinary operation of natural forces.”.
It can sometimes be tricky for a landlord to differentiate between expected wear and tear and serious damage. However, there are a few things you can do to safeguard yourself and your property. These include:
Walk the tenant around the property before they move in, pointing out current marks and making a note of them. This should also be a typical part of your check-in process.
Document the condition of the property by taking lots of pictures or videos between each tenant. Doing so provides proof of how the buy-to-let apartment looked before someone moved in. If there is any confusion about when a mark on the wall happened, you’ll have a solid reference point. Consider this one of your responsibilities as a buy-to-let landlord in London.
Both the landlord and the tenant need to sign a lease for the property, agreeing to conditions set by each party. An Assured Shorthold Tenancy(or other types of leases) should state the conditions around wear and tear, and what counts as being typical.
It's essential to do a walkthrough at the end of each tenancy, just like the one you did before the tenant moved in. This is when you can point out damages (if any) that you believe are the fault of the tenant. End-of-tenancy walkthroughs are also an essential part of the check-out process.
Having a detailed inventory before the tenant moves in and after they vacate the property can go a long way to avoid any issues relating to wear and tear. By recording the property’s condition and contents with an extensive inventory, landlords can safeguard themselves against potential disputes.
For example, a property might be rented with furnishings, including household appliances like coffee machines and microwaves. Yet when the tenant leaves the property, a scenario could arise where these items go missing. However, using an inventory to document they were in the apartment beforehand provides proof of their existence if they were to go missing.
The inventory forms part of the check-in and check-out process and can be performed by the landlord, the managing agent or a professional inventory company. Many landlords have unrealistic expectations of what constitutes fair wear and tear, while tenants rarely admit fault for damages.
Using a professional company to do the inventory can be a great way to mitigate disputes and provide a fair and unbiased report on the condition of the property.
There can certainly be disparities in a landlord and tenant's account of apartment wear and tear, which leads to disputes over who is liable for damages. Fortunately, security deposits are held in official schemes so that landlords can't charge tenants unwittingly without having an independent adjudicator ruling on the case.
Courts in the UK are known to rule in favour of tenants unless the damage is clearly obvious, such as smashed windows or recklessly broken furniture. That's why landlords must keep a thorough record of the property's condition, along with a comprehensive inventory. The tenant must sign the inventory, which will make it harder for them to dispute any damages to the interior or exterior of the property.
There is a cost involved with wear and tear, whether the tenant is liable for damages or the landlord needs to make minor improvements after a tenancy. Pre-2016, landlords could deduct 10% of their yearly rental income against wear and tear when filing a tax return.
After 2016, however, government legislation dictated landlords could only claim wear and tear costs that they actually incurred. This is known as Replacement Relief, which sees landlords claim the cost of a replacement item, rather than an estimation.
An item of furniture that initially cost £200 can only be replaced with another one amounting to the same value. Relief is also only available on items that are provided for the sole use of the tenant.
For items such as boilers, washing machines, and refrigerators, the average use is around 10 years. Therefore, landlords shouldn’t expect to replace these regularly, unless there is a technical fault. However, most electrical appliances come with guarantees, and it’s often worth taking out an extra guarantee if an item is going to be in a tenanted property.
At Blueground, we manage the property on your behalf so you don’t have to worry about a thing. From property conditions to managing tenant complaints, our dedicated property management team ensures our apartments are always in excellent condition.
We also have regular interaction with tenants, meaning there’s a fully transparent relationship and regular property checks. Landlords that lease their property to Blueground can enjoy passive income without worrying about micromanaging wear and tear issues. Any damages done to your apartment will be repaired before you know it!