How to avoid a deposit dispute with your tenant?

Deposit disputes between tenants and landlords usually occur when a tenancy comes to an end. Often one party agrees to back down and a resolution is reached, but if neither party is willing to back down, it can end up being a long and protracted dispute.

Reasons for Disputes

The majority of disputes are related to cleaning (or lack thereof) and property damage, but there are other reasons why a landlord feels that it is necessary to deduct money from a tenant’s deposit. However, in order to do this, a landlord must be able to justify the deduction, so the best way to avoid losing a deposit dispute is to have a detailed record of what condition the property was in at the beginning of the tenancy.

Dispute-Proof a Tenancy

Check-in inventories are essential. (With Newbrix, landlord does not have an inventory check in cost) Make a detailed list of everything included with the property, including furniture and white goods. Take photographs of everything, including floor coverings, and write detailed descriptions outlining any existing damage. If repairs are made during the tenancy, keep a paper trail of communications between you and the tenant, plus receipts and invoices detailing the work carried out. The same applies if you have to re-decorate or repair damage after the tenant has moved out – unless you can provide clear evidence to support your expenditure, you won’t win a dispute.

When the tenancy ends, conduct a detailed check-out process with the tenant and discuss any problems you come across in an amicable fashion. This will make it easier to reach an agreement without resorting to arbitration.

Burden of Proof

The key thing to remember is that the onus is on you, the landlord, to show why you are entitled to keep some of your tenant’s deposit money. Adjudicators will not make a decision in your favour unless you come up with cast-iron evidence to prove you are out of pocket as a result of your tenant’s actions.

Landlord software can help prevent deposit disputes by reminding you to make property inventories and allowing you to keep a record of all communications with your tenants, but preparing a property inventory is the single most important thing you can do at the start of a tenancy.