Tenant deposit cap is cut to 5 weeks by government!

Tenant deposit cap is cut to 5 weeks by government!

7:02 AM, 5th December 2018, About 3 years ago 36

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The government has now confirmed it will cut the maximum deposit for rentals of less than £50,000 from 6 weeks to a 5 week maximum.  The 6 week maximum will still apply for rentals over £50,000 per year.

This decision as part of the Tenant Fees Bill was criticised the day before by the RLA and NLA: Click here to see the article.

James (Broke thehousingmarket shire), Communities Secretary announced: “Today’s amendments will make renting a home of your own more affordable, fairer and more transparent enabling tenants to keep more of their cash and stopping unexpected costs.

“Everyone deserves a home to call their own. Yet for some renters, moving to a new house can be difficult due to high upfront costs and letting fees. This is unacceptable. I want to see a housing market that truly works for everyone, and one which provides a better deal for renters.”

He also confirmed: “Landlords and agents will not be able to write lots of different default fees into a tenancy contract and tenants cannot be charged hundreds of pounds for a damaged item that actually only costs a few pounds to replace.”

Default fees will only be allowed to be charged by landlords or agents for late payments of rent or lost keys.

David Cox, Chief Executive, ARLA Propertymark responded to the news by saying: “Once again politicians are attacking the industry for their own purposes. Tenancy deposits have worked perfectly well for over a decade, and there is no basis in research that these amendments are necessary. This move will do nothing but push the most vulnerable in our society away from professional landlords and agents, and into the hands of rogue landlords and agents who will exploit them.”

David Smith, Policy Director for the Residential Landlords Association said: “In doing a complete about turn on this, it is unfortunately vulnerable and elderly tenants who will suffer, just as Ministers stated when they initially approved a six week cap. Those who will now find it more difficult to secure a home to rent will include those on benefits and those who have a pet as a companion.

“In May, Ministers argued that a cap of six weeks offered a balance between affordability benefits and financial risk to landlords and providing confidence for them to rent to higher risk tenants. They considered that a 5 weeks cap did not offer that protection. Nothing appears to have changed since so Ministers were right then and wrong now.”


by David Price

18:42 PM, 8th December 2018, About 3 years ago

Reply to the comment left by Bristol Landlord at 08/12/2018 - 15:36
Well put. You echo my thoughts.

by Mark Shine

19:18 PM, 8th December 2018, About 3 years ago

Reply to the comment left by David Price at 08/12/2018 - 18:42
BL echoes my thoughts as well. Though I’ve been accused of being a conspiracy theorist 🙄 for just contemplating that TPTB’s ulterior motives / plans for the PRS might possibly be slightly questionable.

by Jim S

22:17 PM, 8th December 2018, About 3 years ago

The Government are making it as easy as possible for a tenant to access property but as difficult as possible for a landlord to get rid of a bad tenant. All of the Government's guff about you have to give the tenant a copy of an EPC certificate and a copy of the "How to rent in England" booklet otherwise you can't evict them is just TOSH to try and trip you up, you also have to give it to them BEFORE THEY MOVE IN, TOSH, if you don't use a tenancy agreement that states its a contractual TA and the the tenancy turns periodic and there is a revision in the booklet of "How to rent in England" and you don't give them this updated copy (even though you have already given then the previous version before they moved in) then you can't evict them. TOSH. If you send them the information by email but don't have their permission to be contacted by email then they class it as not being served and you can't evict, TOSH
The punishment is not relevant to the crime in these circumstances and it certainly does not create a market that is "Fair for everyone"
The Government have PURPOSELY INVENTED these rules so that they catch the landlord out and be able to let the tenant stay in a property so that they do not become a social problem.

by Bristol Landlord

0:04 AM, 9th December 2018, About 3 years ago

Reply to the comment left by Jim S at 08/12/2018 - 22:17
I absolutely 100% agree with all you have said, everything the government has done and continues to do is for a secret agenda which we don’t fully know yet but very likely it’s that the corporate landlords get the good tenants and the BTL landlords get the undesirables. Why build council houses when you can foist the council tenant onto an innocent BTL landlord who is then stuck with them for years.
Incredibly cynical plan by the Govt.

by Michael Barnes

1:10 AM, 9th December 2018, About 3 years ago

Reply to the comment left by Jim S at 08/12/2018 - 22:17
The only omission that cannot (currently) be rectified is failure to serve a gas safety certificate (where one i required) before tenant occupies the property, for new tenancies since October 2015 (and that requirement has existed since 1988; it is only its link to S21 that came in from October 2015).

The things that may (or may not) need doing when a tenancy becomes spt is one of the reasons I now use contractual periodic tenancies. Others include:
- liability for council tax if tenant moves out before tenancy ends;
- Uncertainty of the legal position if one of joint tenants leaves before end of fixed term (HA 1988 seems to say no spt arises).

by Arnie Newington

19:09 PM, 27th December 2018, About 3 years ago

I think if you are putting more money in tenants pockets at a time when they are competing with each other then this money will find its way into rent increases.

This is what happened in Edinburgh when they banned letting agent fees (rents sky rocketed) I suspect this is what will happen here.

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