The Inventory is a list of all the contents of a property and a record of the condition of each item. It is also referred to as a “schedule of condition“. The document is designed to help monitor the condition of the items before a tenant moves in and just before a tenant vacates, so it can be made clear what damages, if any, need to be paid for.
The Association of Residential Letting Agents (ARLA) state that:
"Inventories are absolutely essential documents that provide a written benchmark, that should be amended, updated and recreated before the beginning of each new tenancy."
Whilst not a legal requirement itself, the need for inventories has become increasing prominent due to the 2004 Housing Act. The Act made storing tenant deposits in an approved government scheme a legal requirement for landlords and letting agents. It is no longer allowable for the landlord or his agent to allocate funds from a tenants deposit to rectify damage or dilapidation above fair wear and tear without the tenant’s approval or consent. If a tenant denies a landlords claim then the matter can go to dispute resolution and arbitration.
In practise, a common 'flashpoint' between landlord and tenant is over the condition of the property, its contents and deductions from the damage deposit. Without an accurate property inventory a landlord will find it difficult to justify making any deductions to a tenant's deposit.