When a residential property is rented out, the lease agreement should refer to the responsibilities of the tenant to maintain the property in a state of good repair. This could include requirements to carrying out standard maintenance, clean and decorate.
Where the tenant fails to comply with these terms, and there is resulting damage to the property, this could be deemed a breach of the lease contract. Such breaches are referred to as dilapidations.
Where a rental property is damaged by a tenant, the landlord is within their rights to demand that the property is repaired or to make a dilapidation claim against the tenant for the cost of repairing the property.
Common examples of dilapidations in residential property include:
- not maintaining the condition and cleanliness of carpets, resulting in the need for the carpets to be professionally cleaned
- damage to or loss of non fixed items included in the property rental, such as light shades, curtains or a microwave
- allowing an originally well-maintained garden to become overgrown and full of weeds
- breaking of windows
- damage to walls
- ripped wall paper and marked painted walls, resulting in the need to re-decorate
- where the tenant has vacated the property but has left an accumulation of rubbish
- broken staircase bannisters
- mouse, rat or flea infestation
- chipped, marked or missing kitchen or bathroom tiles
- blocked drains
- broken door handles
- not maintaining the cleanliness of the oven, resulting in the need for a professional deep clean
- water damage
- damaged light fittings
Responsibilities of landlords
Whilst a tenant has a responsibility to maintain any residential property that they rent, the landlord must also play their part in meeting obligations.
As a landlord, you have a responsibility to ensure that:
- your rental property is safe and free from hazards to the health of your tenants
- gas and electrical equipment in the property is safe and in good working order
- there is an energy performance certificate in place for the property
- smoke and carbon monoxide alarms are fitted in the property and that these have been tested and are operational
- the correct fire safety regulations have been followed for the property
Concealing defects in the property that you later use to raise a dilapidation claim may lead to prosecution for fraud.
You must ensure that the lease contract states clearly what elements of property maintenance the tenant is responsible for, such as the general cleanliness of the property and maintenance of the garden.
During the tenancy
During a tenancy, there are two ways in which the landlord can protect their property and guard against dilapidations and hence a devaluing of the property.
Firstly, a landlord may arrange to make yearly visual checks of the property to ensure that it is being maintained to the required standard, in arrangement with the tenant. A copy of the resulting report should be made available to the tenant, especially where there are areas of concern that require action by the tenant. The benefit of carrying out such a check is that it allows the accumulation of neglect to be averted and hence reduces the chance of serious damage to the property.
Secondly, once it is known that a tenancy will cease, a more in depth check, generally carried out by an informed professional such as a chartered building surveyor, should be carried out prior to the end of the lease. This check should take place in sufficient time for any required works to be rectified by the tenant before they leave the property.
It is the responsibility of the landlord to inform the professional of their future plans for the property, whether that is to rent the property out again, to use it in some other way, for instance, as their home, or to sell the property. The reason for this is that where a landlord wishes to make major alterations to the property, or demolish it, after the tenancy has come to an end, they are not permitted to make a dilapidations claim under section 18(2) of the Landlord and Tenant Act 1927.
Where it is found that there has been damage to the property that has breached the lease contract, a schedule of dilapidations will be prepared and made available to the tenant by the landlord. Should the tenant accept responsibility for the dilapidations, they are required to rectify all damage before the lease contract ends or pay the equivalent costs to the landlord for the repairs.
In certain situations, the check may take place after the end of the tenancy, however, this will generally lead to a dilapidations claim for costs to cover any damage to the property and may therefore lead to a delay in obtaining a new tenant.
It is the responsibility of the landlord to ensure that, where dilapidations occur, a schedule of dilapidations is communicated to the tenant in good time.
The onus for proving that dilapidations are present is on the landlord.
What is a schedule of dilapidations?
This document lists any dilapidations noticed in the check of the property, that is, any area of the property that requires work, such as painting marked walls or unblocking of drains, and what the tenant should do to rectify the situation. In certain circumstances, the estimated cost of the required work may be included in the schedule.
The schedule of dilapidations may be prepared by the professional who carried out the check or by the landlord.
Where this schedule is submitted after the end of the lease and tenancy, it will generally be accompanied by a quantified demand detailing not only the costs of the works to be carried out but also the likely loss or devaluing of the property as a result of the dilapidations, and further losses incurred during the period when it was not possible to rent out the property.
In accordance with section 18(1) of the Landlord and Tenant Act 1927, the landlord cannot make a profit from a dilapidations claim, that is, they cannot claim back more than the costs involved in rectifying any damage to the property and covering any related loss. Any costs recovered, or work carried out, must reinstate the value of the property.
What do in in the event of a dispute?
Should the tenant dispute the schedule of dilapidations, negotiations may be entered into, generally with professional advice on both sides such as a surveyor. This may lead to changes in the works to be carried out by the tenant before they leave the property, or the amount of money claimed from them to cover repairs.
Where no resolution can be reached, the landlord may enter into litigation against the tenant, although this can be a lengthy and expensive process. Claims for less than £1,000 may be handled through the small claims court.
Another option is to use an Alternative Dispute Resolution (ADR). This could mean:
- calling on a relevant expert to decide on the dispute,
- entering into mediation where the landlord and tenant, with their advisors, consult a mediator to reach a settlement, or
- entering into arbitration under the Arbitration Act.
How legal advice can help
A major concern of any landlord is of course to protect their property so that it can continue to provide a healthy income for them. Dealing with dilapidations and the resulting claims can be a complex process to handle, especially when the burden of proof lies with the landlord. Take specialist legal advice to ensure you are fully informed and prepared.