Inventories and Deposits…Why?

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I’ve been out and about again this week but this time it was for an enlightening course about inventories, deposits and end of tenancy disputes hosted by EMPO in Nottingham.

Inventories and deposits, we all know about them but do all landlords bother with them? Despite there importance, there are landlords out there that take the risk to do one or the other or worse, neither. A detailed inventory, reasonable deposit and a clear, timely check out report will make the difference between having a strong case or no case in a dispute.

NO inventory + NO check out report = NO case

Do you know that its free for a tenant to dispute a deposit claim? In 10 years, a tenant could have 10 tenancies which could mean 10 disputes, in a system that appears to favour tenants rather than landlords, how often do you think the landlord loses out…

Firstly, you need to get a deposit and register it deposit with a tenancy deposit scheme otherwise you’re not going to have anything to protect you in the first place. As part of the Housing and Planning Act 2016, you must register your tenants deposit with a tenancy deposit scheme within 30 days of receiving it, if you don’t you could end up repaying your tenant up to 3 times their original deposit within 14 days of the order. TDS schemes give you two options:

Custodial – a free option where they hold the money for you.

Insured – a chargeable insured option where you hold the money.

Whichever option you go for, it will only take you a couple of minutes to register the deposit so there’s no excuse!

Next you need to get yourself a cracking inventory, time consuming to do but they are worth their weight in gold when it comes to the end of the tenancy. You can do it yourself, use an independent inventory clerk or get your local letting agent to do it as part of their tenant find/managed service then its up to you decide if you want written, photographic, video based, a voice recording or combination. Speak to your agent/inventory clerk to find out what their method is, whatever you decide, make sure your property is tip top and in the condition you would like it back otherwise it’s a waste of time and money…mostly time! Make sure your tenant signs the inventory at the check in or cover your back and add a disclosure that states after x amount of days that if no amendments are requested then it is taken that they are happy that the inventory reflects the condition of the property.

Quick note, even if you have had the property professionally cleaned before your tenants move in, you cannot demand a receipt at the end of the tenancy for a professional clean, you can only request that it is cleaned to a professional STANDARD. If you choose to put it in the tenancy agreement and the tenant doesn’t provide a receipt for the clean but the property is cleaned to a professional standard then the tenant is likely to win in a dispute.

Property visits throughout a tenancy are crucial and the information and evidence gathered at each visit can prove to be priceless in a dispute, whether it’s photographic proof of washing being hung out indoors without ventilation, pet beds, toys and food in an AST that states no pets and even tabacco/cigarettes on the side could help to prove how a cigarette shaped burn just appeared on a carpet. No evidence = No case.

Lastly you need a check out report and a timely one at that, you can’t roll up a week or so later to take photos and meter readings and expect a dispute to be taken seriously. A check out report needs to be conducted on the final day of the tenancy at a time agreed with the tenant, it doesn’t need to be anywhere near as detailed as an inventory however you still need to photograph the keys and take meter readings, but it only needs to highlight any issues and discrepancies from the original inventory. Make sure the inventory is to hand along with any correspondence you may have had with the tenant throughout the tenancy agreeing any changes so you can walk around the property with them and highlight any issues, this way the tenant is prepared for potential deductions. The tenant must be made aware of any deductions within 10 working days of the tenancy end date, you will need quotes to prove your deductions and you will need an agreement in writing of any deductions from your tenant. If the landlord and tenant can’t agree on the deductions then noone gets any money and it has to go to dispute so make sure you have plenty of strong evidence.

I’m not going to unearth the can of worms that is fair wear and tear because i’ll be typing away all night about that but in conclusion, if you have a cracking inventory, a good deposit, routine visit reports and a timely check out report then you can at least say you’ve ticked all of the boxes in what appears to be a tenant friendly dispute system. Only 1% of deposit resolutions go as far as requiring the independant dispute system so i hope that you can negotiate amicably with your tenants and stay out of that minority.

If you’d like to pop in for cuppa and a chinwag about deposits, inventorys and how we do things then i can always make time for a chat :).

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Become a DASH accredited landlord

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We’re aiming to become a DASH accredited letting agency which means getting all our landlords DASH accredited. This is no mean feat but it will really stand us apart from the rest and ensure tenants can be confident that we only work with great landlords with great quality properties for them to make their home.

What is DASH Landlord Accreditation?

The scheme is a membership designed to reward good landlords and to help them differentiate themselves from less reputable landlords in the property market place. DASH accredits the landlord, not the property, therefore identifying them as being competent and professional.

As an organisation DASH supports landlords with information and guidance on changes in legislation as well as sharing best practice. DASH is recognised by our distinctive logo which members are able to use as a badge to demonstrate their professionalism and gain market advantage.

What do I need to do to become accredited?

  • Agree to adopt the Code of Conduct – the scheme manual is available online from the website at http://www.dashservices.org.uk/Accreditation/Scheme-Manual
  • Pass a fit and proper person test – DASH will check with the relevant Local Authority that there are no outstanding items with you as a landlord or any of your properties
  • Complete the Landlord Development course – the course is free as part of your membership package and is available online from the website at http://dashtraining.org.uk/login/
  • Have a health and safety visit to a sample of your properties – a minimum of 10%
  • Commit to increase your professional development as a landlord by engaging with DASH Landlord accreditation e-learning

How can this save me money?

Nottingham City Council are looking to introduce a Licensing Scheme (Find out more information about this at the Nottingham Landlord Forum). Unlike accreditation the licence fee applies ‘per property’ and not ‘per landlord’. Local authorities offer a discount as they find that there is less work required to process and issue a license for an accredited landlord. The ‘proposed’ selective licence fee in Nottingham is £655 per property for 5 years with a discount of £255 (£400 per property) for landlords who carry the Nottingham Standard.

We’ll soon be emailing all our landlords to start getting them on board and if you have any questions about the process feel free to get in touch with me or with Linda Cobb at DASH. Download the frequently asked questions for further information.

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Septembers Private Sector Landlord Magazine

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Download your copy of the Private Sector Landlord magazine and read about the proposed changes to the Nottingham City Councils selective licensing scheme as well as information following the tradgedy at Grenfell Tower.

The magazine is distributed free through the post you just need to subscribe here.

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Upcoming Auctions In Nottinghamshire

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With some agents and auctioneers seeing a slow down in new instructions and buyers holding back, now is a great time to swoop and grab a bargain. Here’s a list of the upcoming auctions in the area.

Savills lots go under their hammer on Thursday 7th July. Might be a little too late to do your due diligence but keep any eye out if anything doesn’t sell. You can view their lots here.

Mark Jenkinson, a Sheffield based auctioneer, have a few properties in North Notts that have appealing guide prices. Their auction is on 12th July and you can take a look at their lots here.

The newly named SDL Graham Penny have their auction on the 13th from 11.30am at Nottingham Racecourse. They have 38 lots at the moment which you can view here. Their Derby auction on the 21st July also has a few properties in Nottinghamshire.

Wallace Jones are a small auctioneer in Long Eaton. They only have a couple of lots at their auction on 14th July but we’ve bought from them before and they are always worth a look. You can see their properties here.

The portfolio of apartments in Nottingham being sold by Screetons are being sold on the 5th July and it’ll be interesting to see what these fetch. View more here.

If you’d like an opinion on something you’ve seen, whether its going to auction or not, please feel free to get in touch. We help you make the right investment so you can make your money go further.

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How to Spend £100,000 in a Day

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If you happen to have £100k in your pocket, what could that get you in Nottinghamshire?

A key part of our service is offering impartial advice to investors. They always want to know where to buy, what to buy and how much return they will get.

I have taken a look at the market today to give you an insight into the type of property available in this price bracket. Sometimes with change to spare.

Nottingham
For £100,000 you can buy this 1 bedroom apartment in the Lace Market area of Nottingham.
It is a first floor apartment in a warehouse conversion.
For the price you get 364sq ft. It offers open plan living with a combined kitchen/lounge space, which leads down a corridor to the bedroom. The only closed off space is the bathroom. There is no outdoor space or balcony.
It is a very nice looking apartment and would of course be a hit with young professionals in Nottingham.
Typical rental for this apartment would be £525 per month.
This gives a potential yield of 6.3%

Mansfield
For £98,000 you can buy this 3 bedroom semi-detached house in Mansfield Woodhouse. For the price you get approximately 800 sq. ft. of living space.
Lounge, dining room & kitchen/breakfast room on the ground floor. Upstairs are 3 bedrooms and a bathroom. Garden to the rear.
This type of property would be ideal for a family.
Typical rental for this house would be £575 per month.
This gives a potential yield of 7%

Newark
For £99,950 you can buy a 3 bedroom terraced house on Century Street.
For the price you get approximately 700sq ft. of living space. Lounge, dining room, kitchen & bathroom on the first floor. On the second floor are 3 bedrooms and a shower room. Garden to the rear.
This type of property would be ideal for a family.
Typical rental for this house would be £575 per month.
This gives a potential yield of 6.9%

All 3 properties offer decent returns on your investment and the results are typical for the type of property and location, in this specified price bracket of £100,000.

What this shows is that you can own considerably more bricks if you invest in the Mansfield or Newark area.

Apartments in the city centre will always be popular but will have a higher turnover of tenants.

Investing in a 2 or 3 bed house suited to families with children you are likely to get longer term tenants, especially if the property is in catchment for a good school.

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Nottingham at night

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Some of you may have been on the Nottingham Wheel during the past 3 weeks whilst it has been stood proud over the Old Market Square. Stretching 60m into the air, the 12 minute ride gives you views of Nottingham like you have never seen.

I took the opportunity last weekend to get a bird’s eye view of Nottingham and capture it with my Nikon and the wide angle lens.

Nottingham Wheel

Old Market Square

Beneath the wheel

Beneath the wheel

One of the most striking views is that of the Nottingham Council House. The Neo-Baroque style building designed by Thomas Cecil Howitt has a beautifully lit dome. Floating above the building makes you appreciate the grandeur of the construction.

Nottingham Council House

Nottingham Council House

To the left of the Council House on the corner of Long Row and King Street is one of Watson Fothergill’s many designs around Nottingham, The Queens Chambers.

The Queens Chambers

The Queens Chambers

If you didn’t get chance to visit the wheel this time around make sure you book on when it next visits. Although given it was last in the city over 4 years ago you could be waiting a while…

The Nottingham Wheel

The Nottingham Wheel

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