What are Dilapidations?

What Are Dilapidations? A Complete Guide for Tenants and Landlords

If you're leasing or renting a property—whether commercial or residential—you may have come across the term "dilapidations". But what are dilapidations, and why are they so important for both landlords and tenants to understand?

In the world of property and lease agreements, dilapidations refer to the legal obligations a tenant has to maintain, repair, and sometimes restore a property to its original condition as outlined in the lease.

These obligations can carry significant financial consequences and are often a key point of negotiation at the end of a lease term.

In this comprehensive guide, we’ll answer the question “what are dilapidations?” and break down everything you need to know about managing dilapidation responsibilities effectively.

What Are Dilapidations?

Dilapidations are the repairs and reinstatement works that a tenant may be required to carry out, or compensate the landlord for, either during or at the end of a lease.

These duties are set out in the lease agreement and relate to the condition and upkeep of the property.

Typically, a lease will include covenants that make the tenant responsible for keeping the property in a state of repair.

If the tenant fails to uphold these responsibilities, the landlord can serve a schedule of dilapidations, which details the breaches and the costs to rectify them.

The concept of dilapidations is particularly relevant in UK commercial property leases, but it can also apply to residential tenancies, depending on the terms.

Key Aspects of Dilapidations

1. Lease Terms and Conditions

Every lease outlines specific repair and maintenance responsibilities.

These usually include :

Keeping the interior and exterior of the property in good repair

Repainting and redecorating at agreed intervals

Reinstating alterations back to the original layout

Complying with legal and safety regulations

These terms form the basis of the tenant’s responsibilities regarding dilapidations.

2. Tenant's Ongoing Responsibilities

Tenants must generally keep the premises in good condition throughout the lease. This includes addressing:

Day-to-day wear and tear

Accidental damage

Structural issues (in some cases)

Maintenance of systems like heating, plumbing, and electrics

Failing to meet these obligations can result in a legal claim for damages when the lease ends.

3. Interim Dilapidations and Inspections

Landlords have the right to conduct interim inspections during the tenancy. If they find the property is not being properly maintained, they can issue interim schedules of dilapidations.

These are notices requesting the tenant to carry out necessary repairs before the lease ends.

Terminal Dilapidations: What Happens at Lease End?

One of the most critical moments in the dilapidations process occurs at the end of a lease.

This is when the landlord typically instructs a building surveyor to carry out a final inspection of the property.

Terminal Schedule of Dilapidations

The surveyor will produce a terminal schedule of dilapidations that outlines:

The repairs required

Any breaches of lease covenants

The estimated cost of the remedial works

This schedule forms the basis of a potential legal claim by the landlord.

Financial Implications of Dilapidations

Understanding what are dilapidations isn’t just about legal obligations—it’s also about money.

Dilapidations can result in significant financial liability for tenants if not managed properly.

If the tenant does not carry out the necessary repairs before vacating the premises, the landlord can seek compensation for the costs. This may include:

The cost of physical repairs

Loss of rental income during the repair period

Legal and professional fees

Tenants should be aware that dilapidations claims can run into tens of thousands of pounds, particularly for commercial premises.

Negotiating a Dilapidations Claim

Once a terminal schedule is issued, the tenant and landlord can enter into negotiations.

The tenant is not required to accept the landlord’s claim at face value. Instead, they may:

Challenge the extent of the required repairs

Dispute the cost estimates

Provide evidence that some repairs are unnecessary

Referring to the Pre-Action Protocol for Dilapidations (provided by the UK Government) is helpful in ensuring the process remains fair and transparent.

The Role of Schedules of Dilapidations

A schedule of dilapidations is a formal document prepared by the landlord (or their surveyor), detailing:

The disrepair present

The clause(s) in the lease that have been breached

The required remedial work

The estimated cost of repairs or reinstatement

This document serves as the foundation for negotiation or legal proceedings and is essential in answering the question, “what are dilapidations?”

Proactively Managing Dilapidations Liability

Tenants should not wait until the lease ends to deal with dilapidations.

You should appoint a dilapidations surveyor at least six months before lease termination or before exercising a break clause.

This gives tenants time to :

Assess their liabilities

Complete repairs proactively

Negotiate from a position of strength

Options for Tenants While Still in Possession

While the tenant still occupies the property, they have control over how repairs are carried out. They can :

Complete repairs, redecoration, and reinstatement themselves

Negotiate a cash settlement with the landlord

Use the surveyor’s advice to reduce costs

Once the tenant vacates the property, they lose the ability to control the repair process and are left vulnerable to inflated claims.

Considering Landlord Intentions and Supersession

A smart strategy for tenants is to ask what the landlord intends to do with the property after the lease ends.

If the landlord plans a change of use—for example, converting offices into residential flats—then some repairs may be irrelevant, which can significantly reduce or eliminate the dilapidations claim.

This is known as supersession, and it can be a powerful tool in negotiations.

Additionally, tenants can request a diminution valuation—an expert valuation of how much the property's value has truly diminished due to disrepair—which can help cap their liability.

Conclusion: What Are Dilapidations and Why Do They Matter?

So, what are dilapidations?

In essence, they are a tenant’s contractual obligations to repair, maintain, and possibly reinstate a property under the terms of their lease.

Ignoring these responsibilities can lead to costly claims from landlords at the end of the lease.

Both landlords and tenants must fully understand their rights, responsibilities, and strategies for managing dilapidations.

Early planning, clear communication, and expert advice are key to minimising disputes and avoiding unexpected financial burdens.

Whether you're about to sign a lease, mid-way through your tenancy, or preparing to exit, knowing the answer to “what are dilapidations?” is essential for protecting your interests and avoiding costly surprises.

Resources

Dilapidations Blog for further information on a range of Dilapidation topics

Contact

Our expert team have extensive experience of dealing with all dilapidations matters. We act for both landlords and tenants, ensuring a global approach to the dilapidations process.

For more information on managing your repairing and lease obligations see our recent article.

We assist commercial landlords and tenants on all aspects of lease obligations, repair and dilapidations.

We provide specialist surveys, new lease schedules of condition and general dilapidations advice.

For any help or advice on repair obligations, Dilapidations issues; or to commission a schedule of condition for a new lease call us on 020 4534 3132 or contact one of the team :