30th
Aug 2021
A major industry body’s support of the government’s intended lifetime deposits scheme apparently has ensured that the majority of the sector are in favour.
The industry body has fully backed the government’s plans to introduce lifetime deposits for tenants which can be ‘passported’ from one property to another when moving.
The so-called ‘majority’ in favour of the plans covers all PRS’ sectors including agents, regulatory and landlord bodies….. and of course tenants.
The industry body fully backs the plan of the creation of ‘switchable’ tenancy deposits for the millions of renters in England and Wales.
Upon implementation of the scheme it will then allow tenants when moving to have their deposit ‘switched over’ to their new agent/landlord, therefore dispensing with having to save up for a secondary deposit.
However the industry body has issued a blunt warning to the government that the scheme should also have a trusted process for landlords who need to claim back deposits from tenants with rental arrears or caused damage to a property.
It says: “This could arise when a tenant transitions from one rental property to another, and where part or all of the deposit they paid is required to cover or is being disputed as a result of damage to a property.
“The scheme must protect the new landlord in such circumstances.”
Another industry player fully backs the ‘double deposit’ point, saying: “An inability to find these additional funds is a huge drawback of the current system as it slows the market down; something which introducing a lifetime deposit could easily solve.”
Generation Rent’s Director Alicia Kennedy, says: “It is difficult to save five weeks’ rent to put down a deposit when your existing one is tied up in the current property.
“The government must also make sure the process of getting your deposit back is fair, to give renters trust in the system.”
Richard Merrick of PIMS, says: “In theory the plan makes sense however there seems to be little information available of any form of process for landlords being able to claw back any of the deposit if introduced ?
“If a new system is put into place there is every chance the process will take far longer than the present stated deposit scheme guidelines.”
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