This month our focus is on Deposits and how the traditional “bond” is being phased out, particularly after the introduction of the tenant Fee Ban legislation in June 2019.
Deposits are taken primarily as security for landlord at hte end of the tenancy and can be retained by the landlord if they can prove the tenant is in breach of their obligations. Strict rules of detailed processes exist regarding the protection of the deposit at the start of the tenancy although the most significant recent as part of the fee ban is that they are now capped at the equivalent of only 5 weeks worth of rent. This is the maximum amount that can be taken even if there are extraordinary circumstances such as landlord allowing pets to be kept at the property or even if tenant agrees to pay a higher amount. Importantly the cap also applies upon tenancy renewal with any amount taken previously that exceeds the cap needing to be refunded to tenant to comply with the act. As the saying goes however with every cloud there is a silver lining which in this case is the introduction of new deposit alternative schemes such as Reposit. Reposit is an insurance backed scheme offering landlords cover of up to 8 weeks worth of rent for end of tenancy breaches and the best news is that tenant pays the premium! Further details are available at https://reposit.co.uk/ As well as the increased protection this offers landlord it also reduces the up front cost to tenant making the moving process a whole let cheaper for tenant.
Watch out for future monthly updates although if you do have any queries in relation to the above please feel free to give the office a call – 01535 980060