Wear & tear: Making things ‘fair’ for tenants

I know from having previously been a tenant myself – and from working with many landlords in my job – that the check-out inspection is often a thing of dread for all parties. That’s why it so important for agents, landlords and tenants to have a common understanding of what is being assessed and to be clear on what constitutes ‘fair wear and tear’.

 

What is ‘fair wear and tear’?

This is defined as: “the natural deterioration of an item or area due to its age and everyday normal usage.” Items within a rental and indeed the décor within a rental property have an average useful lifespan. This means that their value deteriorates over time, broadly in line with their condition.

This is a crucial concept for agents and landlords to grasp as it forms the basis when proposing any deposit deductions at the end of a tenancy.

Are you properly checking out?

The check-out inspection should ALWAYS be carried out by an impartial third party. Its purpose is to identify any changes in the condition of the property between the start and the end of the tenancy. However, just to be clear, that deterioration does NOT necessarily mean that the tenant has caused damage, misused an item or area or has otherwise breached a contractual obligation. It could simply be the case that an item has deteriorated over time through normal usage. And in such instances, no deduction from the deposit would be warranted.

When the agent and/or landlord receives the check-in and check-out reports, a key job for them is to carefully review the documents and note down any deterioration. In doing so, they should consider fair wear and tear as a factor when establishing whether the deterioration is damage, or due to natural use.

How do you assess what constitutes ‘fair wear and tear’?

This is a great question as there is of course a degree of subjectivity here. To help make a consistent evaluation though, you can refer to this checklist of factors. These are things that can influence the scope of fair wear and tear, which a landlord could reasonably expect within a rental property:

• The total number and relationships of the occupants
• The duration of the tenancy period
• What condition an item/area was in at the start of the tenancy
• The quality of an item
• The average useful lifespan of the item

As an example, think about some carpets, which were in a ‘fair condition’ at the start of the tenancy. Come the end of a five-year tenancy, they are now ‘fraying’ and ‘faded in colour due to use’. If ‘fair wear and tear’ was not accounted for here, a landlord or agent may attempt to make a deduction from the tenant’s deposit for the deterioration of the carpet. However, given the carpet was not new at the start of the tenancy and the tenants lived there for five years, it is now at least six years old. The deterioration described is therefore almost certainly due to natural usage over time.

The final analysis

The main takeaway I believe is the importance of having a framework (like the checklist above) to consider and make consistent decisions relating to fair wear and tear. Using this or something like it can be helpful in reaching a fast and fair resolution with the tenant. Moreover, it makes things much more transparent for all parties.

Failure to take this approach will likely lead to deposit deductions being proposed, which are either unreasonable or unjustified (or both!). And this could prolong the conclusion of the tenancy process and even result in a tenancy deposit dispute where an adjudicator ends up making no award.