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Landlords: deposits and the coronavirus crisis

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The coronavirus crisis has upended practically every aspect of our everyday lives. Relationships between landlords and their tenants are no exception. The handling of tenancy deposits, in particular, has given rise to many questions and requests for clarification, reports the Residential Landlords’ Association (RLA).

Releasing a deposit on check-out

One of the particular issues raised by the RLA is the potential difficulty for landlords in conducting a satisfactory inspection and inventory check for loss or damage if a tenancy has come to an end and the tenant is checking out.

The inspection is necessary, of course, before the landlord can be confident in authorising the release of the deposit – either in full or after the deduction of an agreed amount for breakages and damage.

Because of the current lockdown and the need to maintain social distancing – in the interests of both landlord and tenant – the customary accompanied inspection and inventory check can no longer be made in person.

Virtual inspections

One solution to this problem is for the landlord to ask the departing tenant to walk through the let property and record the surroundings on their smartphone. This should be timestamped.

Videos made in this way may be enough to satisfy the landlord that the property is in satisfactory enough order to return the deposit – especially if there have been fairly regular visits and checks made in the normal course of events pre-lockdown.

As the RLA acknowledges, though, no video can pick up issues with lingering smells and odours or even dirt-stained surfaces.

What passes for an acceptable virtual inspection, therefore, is necessarily at the landlord’s discretion.

Delayed inspections

If social distancing means access to the property has been impossible, or a virtual inspection has been inconclusive, the three official tenancy deposit scheme operators in England and Wales (TDS, DPS, and My Deposits) have agreed that the process may be delayed - temporarily relaxing the timeframe required to submit the check-out report to four weeks. 

If necessary, that inspection may need to take place once the tenant has already vacated the let property. Clearly, it still needs to be done as soon as possible – so that the tenant is satisfied there has been no deterioration in the state of the property.

On receipt of the landlord’s final approval, the deposit holding company may then release the funds to the tenant.

Keep up the communication

In a posting dated the 28th of April 2020, tenancy deposit scheme provider My Deposits urged close communication between landlords and tenants during the current lockdown – and especially if there are difficulties concerning the end of tenancy inspections and damage checks.

Landlords must let their tenants know if there is any expected delay in the release of their deposit – because the final inspection has been delayed, for example. It is suggested this is communicated via email so that there is a written record (rather than a ‘phone call).

Landlord and tenant dispute resolution

Even during the current difficulties, the tenancy deposit scheme providers continue to offer a free dispute resolution service if landlords and tenants are unable to agree to the terms – and amounts – of any deposit to be held back because of breakages or damage.

When mediating such disputes, the scheme providers will want to take into account the actions taken by landlords and tenants – video recordings and notes on any virtual inspection, for example – together with the record of communication between the parties.

For more information and for updates, the TDS advises all parties to visit the webpage regularly for updates. Visit: https://www.tenancydepositscheme.com/covid-19/.

Further reading: Deposit protection during the coronavirus crisis