Dilapidations in the UK – diminution valuations

The purpose of this paper is to look at the practical considerations of valuations undertaken in the UK at the end of leases when the landlord and the tenant are negotiating on the dilapidations claim.

The paper is a review of current professional practice and highlights the salient issues to consider when looking at dilapidation claims.

The paper considers a fundamental principle of dilapidations. That is, how much has the market value of the landlord’s interest diminished at the end of the lease by reason of the disrepair.

The paper is based on the interpretation of current statute and case law. Diminution valuations are hotly contested and there is currently little professional guidance available to practitioners.

The paper guides landlords, tenants, building surveyors and their valuers on the thought process and practical approach to be adopted in assessing loss in dilapidations cases where the underlying assessment will be carried out on the basis of diminution in value.

There is very little written on the practical implications of diminution valuations when assessing dilapidation claims. This paper addresses that shortcoming.