Everything Letting Agents Need to Know About Conducting Inventories

A recent survey found that landlords were losing out because of failings in the inventory process. Conducting inventories properly is an essential part of the letting process. An inventory serves as a detailed record of the property’s condition and contents at the beginning and end of a tenancy.

For letting agents, this document is crucial for avoiding disputes, protecting landlords’ investments and ensuring a smooth transition between tenants. Here’s everything letting agents need to know about conducting inventories effectively.

Why Inventories Matter

Inventories are not just a formality – they’re a legal safeguard for both landlords and tenants. They provide an objective account of the property’s condition at the start of a tenancy and serve as a benchmark for assessing any damage or wear and tear when tenants move out. This is particularly important for determining the return of deposits and resolving potential disputes over damage or cleanliness.

Without an inventory, disputes about property conditions become harder to resolve, and landlords may struggle to justify deposit deductions. A comprehensive inventory protects landlords and reassures tenants that they won’t be unfairly charged.

What to Include in an Inventory

An effective inventory should be highly detailed, covering every room and all the contents provided by the landlord. Here’s what should be included:

1. Property Overview

Begin with general details about the property, including the address, the date of the inventory, the names of the landlord and tenant, and who conducted the inspection. Include details on meter readings and key counts as well.

2. Room-by-Room Condition

Each room should be assessed individually, noting the condition of floors, walls, ceilings, windows, doors and any fixtures. Detail any existing marks, scuffs or damage to prevent disputes over pre-existing issues. Be specific, describing the location and type of any wear and tear.

3. Furniture and Appliances

If the property is furnished or partially furnished, each piece of furniture and appliance should be recorded, along with its condition. Include items such as sofas, tables, beds, white goods and smaller kitchen appliances. If possible, list serial numbers for higher-value items.

4. Fixtures and Fittings

Document the condition of fixtures and fittings, including light fittings, curtain rails, smoke alarms and bathroom fixtures. Check that everything is functional and note any signs of wear.

5. Outdoor Spaces

If the property has a garden, balcony or other outdoor space, include these in the inventory. Describe the state of any furniture, plants, sheds, or fencing to give a full picture of the property’s condition.

6. Photographic Evidence

Include photographs for each room and item listed in the inventory. Photographic evidence adds another layer of detail and makes it easier to spot any differences at the end of the tenancy. Be sure to label photos clearly and provide close-ups of any existing damage.

Conducting Inventories: Best Practices

Conducting inventories can be time-consuming, but it’s worth taking the time to be thorough. Here are some best practices for an accurate and comprehensive inventory:

1. Use Clear and Detailed Language

Avoid vague terms like “good condition” or “fair wear and tear.” Be specific, using phrases such as “minor scuff on left corner of sofa” or “slight peeling on bathroom window frame.” The more specific, the better.

2. Use Technology

Consider using an inventory app or software that allows you to record and organise details and photos in one place. Many modern inventory tools allow digital signatures, making it easier to get tenant confirmation on the spot.

3. Do a Joint Inspection

If possible, conduct the inventory with the tenant present, as this allows you to address any questions they may have and ensures both parties agree on the property’s condition. Having the tenant sign off on the inventory at the start of the tenancy can reduce the risk of disputes later.

4. Update the Inventory Regularly

For long-term tenancies, consider conducting interim inspections and updating the inventory if necessary. This helps to document any gradual wear and tear and can identify maintenance needs before they escalate.

At the End of Tenancy: The Check-Out Process

At the end of the tenancy, the inventory acts as the basis for a check-out inspection. During the check-out, compare the property’s current state to the initial inventory. Note any differences, such as damage beyond fair wear and tear, and use this as the basis for any deposit deductions.

Fair Wear and Tear

Fair wear and tear—minor scuffs, faded paint, worn carpets—must be distinguished from damage. Tenants are not liable for fair wear and tear, and any deductions should be based solely on damage or issues that exceed reasonable use.

Finalising the Inventory

Once the check-out inspection is complete, update the inventory and provide a final copy to the tenant. Include any agreed-upon deductions and, if possible, discuss and resolve any discrepancies at this stage to avoid escalation.

Outsource for Success

Outsource property management to us and we can carry out inspections at all of your properties, ensuring they are in good condition and tenants are looking after them. This is just a small part of our offering and you can find out more on the dedicated page.