Fair Wear and Tear

The occupier will be entitled to an element of fair wear and tear.

Fair wear and tear has been defined as "reasonable use of the premises by the occupier and the ordinary operation of natural forces". The word 'reasonable' can be interpreted differently, depending on the property type and who occupies it. In addition, a landlord is not entitled to charge the occupier the total cost for having any part of the property or any fixture or fitting put back to the condition it was at the start of the agreement.

A landlord should not end up financially or materially in a better position than they were at the start of the agreement or would have otherwise been at the end of the contract after allowing fair wear and tear.

When considering repayment of a deposit, landlords should keep in mind that the deposit is not to be used like an insurance policy where you might get 'full replacement value' or' new for old'.

The three deposit schemes (see earlier) have jointly produced helpful guidance, including fair wear and tear information. You can find this on their websites.

Betterment

The rules of betterment explain a landlord should not be at a financial advantage or disadvantage at the end of a tenancy allowing for fair wear and tear of a rented home.

Fair wear and tear depends on the tenancy.

For instance, a home rented by a pensioner is likely to suffer far less wear and tear than one rented by a family with young children or pets.

The next point to consider is the best way to correct any damage that is more than fair wear and tear.

Low-cost cleaning or repair

This could be cleaning a stain on a rug rather than replacing the item. 

If the landlord replaces the rug and deducts the cost from the deposit, this would be betterment rather than repair.

In this case, the landlord should split the cost – charging the tenant a fair cost for the repair but paying for the rest of the replacement charge.

The way to do this is to ask for quotes for removing the stain from two or three cleaning firms and charging the tenant the cheapest.

You should supply copies of the quotes to the tenant before replacing the rug.

The cost should then be deducted from any deposit.

Fair cost of replacement

Sometimes, cleaning or a repair is not worthwhile for the landlord, but charging the tenant the replacement cost is unfair.

Take a fitted carpet that has seen the best years of wear with a stain that needs cleaning.

Apportioning the cost is the fairest way to charge the tenant.

This formula considers the value and lifespan of the asset and splits the purchase cost over the lifespan.

The figure input as the asset's expected life should reflect the degree of wear and tear relating to the tenancy.

Adjust the figure up for low wear and tear or down for high traffic.

Here is a worked example showing how the formula works:

Betterment Formula

The principle is that the tenant should only pay a fair cost of cleaning or replacing an asset proportionate to the time they spend in the home.

Back up the calculation with a copy of the original purchase invoice and explain how you calculated the asset's expected life.