On the 1st of June 2019, the Government introduced the Tenants Fees Act in England which puts a limit on tenancy deposits paid by tenants to private landlords and bans most letting fees.
Whilst this is good news for tenants, this has not been good for landlords!
The cost of credit checks, inventory check-ins and outs, were previously paid for by the tenant. Under the new Act, landlords will now have to cover these costs.
For more information on the Tenants Fees Act, please see https://www.gov.uk/government/collections/tenant-fees-act.
For credit checks on potential tenants, it is possible for landlords to lose as much as £100 before the tenant has even picked up the keys! Checks cost as much as £20 per tenant and if a couple fail the test, the landlord would have to pick up the loss as well as pay for the next potential tenants. This could happen multiple times. In addition to the cost of credit checks, inventory checks are now to be paid for by the landlord too!
Where costs can be passed on to the tenant in the form of higher rents, landlords have passed it on but where this is not feasible, some have opted to leave the industry altogether.
An alternative to leaving:
Leaving the industry should not be the solution. Landlords need to think of ways to streamline costs, for example, leveraging technology including property inventory software apps, to perform the inventory checks such as https://inventorybase.co.uk/.
Many a property inventory software app is now available that enables remote control access from anywhere at any time with the ability to book inspections, use voice transcripts to create inventory reports, store past reports, track inventory and identify potential issues and basically simplify the whole Inventory check process with the sole purpose of reducing lost deposit claims and the hassle of arbitration at the end of a tenancy.
Technology that can be used remotely, means that landlords have more control and visibility of the inventory they provide for tenants thus making it more cost effective and efficient to perform the service themselves instead of paying as much as £100 each for Inventory checks when tenants move in and when they move out. In the long run, this new software can help landlords reduce time and money.