Fair wear and tear – what is it and how is it applied?
Way back in the 1950s a famous judge, Lord Denning, said that a tenant “must take proper care of the place…” which any reasonable tenant would do, and not cause damage wilfully or negligently. However, he also said “if the house falls into disrepair through fair wear and tear or lapse of time, or for any reason not caused by him, the tenant is not liable to repair it.”
This became the industry approach and accepted principle for every tenancy, referred to in Court of Appeal cases and is specifically written into tenancy agreements as standard.
So, what is ‘fair wear and tear’?
When an item or area in the property deteriorates, due to its age and normal use, this is reasonable wear and tear. So, you should only propose a deposit deduction or end of tenancy costs from the tenant when the deterioration was avoidable and due to the tenant’s actions or omissions. Not just by living in the property. The simple fact is that everything will need to be replaced or renewed at some point in time.
The big question is, what part of any deterioration would have happened naturally anyway and is considered ‘reasonable’? Or is the damage over and above what is normal use, considering all the circumstances which makes it ‘unreasonable’?
Does fair wear and tear apply to cleanliness?
A very important rule is that fair wear and tear only applies to the ‘condition’ and not the ‘standard of cleaning’ of a property or item. The property must be left cleaned to the same standard at the end of the tenancy, whether the tenancy lasted one year or six!
What is betterment?
You may have heard of the term ‘betterment’, which becomes relevant with assessing fair wear and tear and reasonable costs. Betterment is where compensation is awarded, or claimed, for damaged items that would leave the landlord or property in a better position, but at the tenant’s expense. For example, looking to replace a five year old carpet with a brand new one and claiming the full amount from the tenant.
Betterment applies to both ‘condition’ and ‘cleanliness’. In the case of cleaning, claiming for a professional clean when the property was only domestically clean at the start would amount to betterment.
With condition, a valid claim will have considered fair wear and tear, and the extent of the deterioration that the tenant has caused, which is more than the normal use and on a like for like basis.
When assessing fair wear and tear, there are five areas we consider collectively, which are listed below.
Having all the information relating to these five areas ready before any negotiation can lead to a productive and positive discussion with your tenant and a successful resolution.
Top tip: This is a good time to remember the value of having a quality check-in inventory so that you have good comparative evidence when the tenancy ends and for any negotiation, if needed.
The five key points to fair wear and tear?
Age
Being able to show something’s age is the first step to calculating a reasonable settlement when assessing the extent, if any, of a tenant’s responsibility. An older item will attract a higher level of wear and tear and you should always consider this when managing your expectation of what a reasonable settlement will be.
Do you know the age of your fittings, furniture and décor, and have the invoices to back it up?Are you proposing a settlement for an item which was brand new, or an area which was free of any damage and marks, when the tenancy began? Or has it already seen several tenancies?
Top tip: Keep all the invoices when you carry out work or replace anything and make sure they are detailed; the date of supply and/or fit will prove the length of time since things were new.
Quality
Spending more money on quality items is something to consider very carefully when you are preparing to rent out a property and, in terms of calculating fair wear and tear, this is very relevant when claiming for damage or replacement.
Knowing the quality of an item is most helpful when negotiating a like for like replacement cost, yet inventories rarely record the quality of items such as carpets, which cannot be seen in photographs, or sanitary ware. Was the carpet £9.99 or £18.99 a square metre when it was bought? Again, this means an invoice is invaluable when proposing costs for a similar item or quality of work needed. Quality branded sanitaryware may, for example, last a long time, but it doesn’t mean that lesser, cheaper brands would not last the same amount of time. If a weight is dropped into a sink, it may crack whatever the quality.
However, the check-in inventory may, at the very least, contain good quality photographs and detailed description to help with any discussions needed, for example the make of an appliance.
Top tip: Make sure your detailed invoices are all kept safe as you never know when you might need them for discussing costs on a like for like quality basis.
Who is renting the property – who are your tenants? Are there any pets?
Are your tenants students, professionals or families? Are any children and/or pets living in the property? How many bedrooms are there and how many people are renting the property? These questions can all influence the expected level of fair wear and tear and may influence the lifespan of areas and items in a property.
Deterioration such as scuff marks, scratches and wear to flooring is unavoidable in all properties. You must consider whether the deterioration is reasonable, or excessive, for the number of people and whether there are any pets living in the property.
A landlord who manages their own expectations will appreciate that if the rental property has six bedrooms and the tenants are a family with three young children and a dog, it is likely to experience a higher level of wear and tear in all the common areas such as the living room, stairs, bathroom and kitchen.
If the evidence shows that there is actual damage or deterioration which is over and above what is reasonable, having considered the type of tenant living in the property, then the tenant may be responsible for costs to put right the ‘excessive’ portion.
Top tip: Appreciate who your tenants are, and problems can be spotted early if you carry out regular mid-term inspections.
What is the expected life of the item or area?
Every item and area has a shelf life! The life expectancy of an item, or area, can depend on its quality and the amount it’s used. This may be related to the number of hours in the day the property is occupied, the number of tenants in the property or how much that area or item is used.
The quality of the décor and appliances, for example, can vary drastically. Our consistent approach on the life of décor and carpet in a rented property, starts at five years and depending on the quality of the evidence, this may change.
Other items, such as appliances, work tops, sanitaryware etc. will all be assessed on a case-by-case basis.
When looking to calculate what proportion of a replacement or redecoration cost is reasonable to discuss with your tenant, and the lifespan, you will need to consider the age and quality of the item, or area, to decide how many years it has already been used for and if its life is all but over. Remember, the tenant is not responsible for these years.
Top tip: Make sure any costs you are proposing do not amount to betterment, as with every tenancy there will have been some wear, even if it’s small.
How long was the tenancy?
The last thing to ask yourself when considering fair wear and tear, and before calculating any costs and proposing them to your tenant, is ‘how long has the tenant been living in the property’?
As already mentioned, there will be more natural wear to the property the longer it has been lived in and used. Think about things such as how much more wear will a carpet or décor have had after one, two or three years, and what was the condition of it when the tenant moved in?
Top tip: the length of a tenancy is often a deciding factor when managing your own expectations on whether the item or area has little or no value left in it, because of its condition at the start and the length of the tenancy.
Summary
Breaking down any proposed costs for a tenant, by showing exactly what was considered and how the amount was calculated, using the information above, can help diffuse any potential conflict. The value of good quality check-in and check-out inspection reports, together with property visits carried out during the tenancy, plus written records of anything else that may help in any negotiation such as invoices and emails, will all help.
It is also worth remembering the importance of building a good relationship from the start of the tenancy, which should include offering tenants good advice. Landlords and tenants who do this and are reasonable when discussing and listening to each other’s points of view will often reach a mutual settlement. This allows everyone to move on and is why less than three per cent of all tenancies result in the need for a formal resolution.
Checklist
Why is fair wear and tear so important?
Everyone needs to understand that this principle is here to stay, is implied into every tenancy agreement, if it is not written, and must be considered when your tenant has moved out leaving damage or deterioration.
That is why we have created a checklist to help you account for fair wear and tear. Download our fair wear and tear checklist here.