Posts with tag: tenancy deposits

The Premier League of Tenancy Deposits

Published On: April 29, 2016 at 9:21 am

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The Deposit Protection Service (DPS) has released a football league table that ranks clubs by the average tenancy deposit size for their postcode.

The Premier League of Tenancy Deposits

The Premier League of Tenancy Deposits

Using the scheme’s ranking, Fulham would be top of the Premier League, while Everton would fall in bottom place of League Two.

Tenancy deposits for those renting near Craven Cottage – Fulham’s home ground in London SW6 – have averaged £1,682.76 during the 2015/16 football season, putting it top of the Premier League.

Deposits for rental properties near Everton’s ground – Goodison Park – average £383.26, the cheapest of any league club, placing the team in last place of League Two.

The DPS’s ranking puts eight Premier League teams in the bottom division – Stoke City, Leicester City, Sunderland, Aston Villa, Liverpool, Southampton, Newcastle United and Everton.

Just five Premier League clubs retain a top-league place – Chelsea, Arsenal, West Ham United, Tottenham Hotspur and Watford.

Crystal Palace and Stevenage Borough both achieve promotion from the Championship to the Premier League.

Additionally, seven League Two clubs would find themselves in the Premier League – Barnet, AFC Wimbledon, Crawley Town, Leyton Orient, Oxford United, Dagenham and Redbridge, and Cambridge United.

The Managing Director of the DPS, Julian Foster, comments: “It’s fun to see how much the most passionate supporters have to pay in the form of a deposit to live a short walk from every home game, and looking at the football league from a different perspective certainly produces some interesting results.

“As a Leeds fan, I’m devastated to see us sitting in League One – although fascinated to see Manchester United facing relegation to League Two!”

He insists: “Wherever the property, however, protecting deposits properly gives both landlord and tenant peace of mind and ensures that money is returned fairly to both parties.”

All landlords and letting agents must remember that it is a legal obligation to protect all tenancy deposits and provide tenants with the prescribed information within 30 days of receipt.

Will the Private Rental Sector be Out of Reach for Many in the Future?

Published On: March 10, 2016 at 12:23 pm

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Worrying new research suggests that spiralling rent prices and high deposit requirements will put even the private rental sector out of reach for many in the future.

It is well known that young first time buyers are struggling to get onto the property ladder, but now Money.co.uk has estimated that in ten years’ time, the average rent deposit could hit £1,111 – a huge 70% of the average Briton’s monthly income of £1,576.

In London, deposits are expected to rise to £2,733 – a whopping 120% of a Londoner’s average monthly salary of £2,281.

Will the Private Rental Sector be Out of Reach for Many in the Future?

Will the Private Rental Sector be Out of Reach for Many in the Future?

The website believes that private landlords will require a deposit equivalent to six weeks’ rent by 2026, while monthly rent prices will go up by over a quarter (28%) to £1,111 over the same period.

Overall, rent price growth is expected to exceed average monthly salary inflation across the UK, which is estimated to increase by just 20% in the next decade.

Money.co.uk predicts that deposits will increase significantly across the whole of the south of England.

In the South East, the average deposit is expected to reach £1,469 by 2026 – over four-fifths (83%) of the average monthly income of £1,761, and up from 72% in 2015.

Meanwhile, in the South West, the average deposit is set to be equivalent to 80% of the average monthly earnings by 2026, up by 14% from 66% of the average salary in 2015.

The Editor-in-Chief of Money.co.uk, Hannah Maundrell, explains the forecast: “The rapid rise in deposits as well as rents is a double blow for everyone on the rental ladder.

“With the forthcoming changes to tax legislation and crackdown on buy-to-let mortgages likely to erode landlords’ profits, there’s little doubt these costs will be passed on to tenants.

“The current booming property market means deposits are likely to continue shooting upwards in the future, and we could well see six weeks’ worth of rent extended to eight.”

She continues: “Tenants are stuck between a rock and a hard place, and the situation is only likely to get worse. Many not only face being priced off the property ladder, but also the rental ladder too. This could force people to borrow the extra cash they need for a deposit on loans or credit cards, pushing up the cost and creating a perfect storm for a major renting crisis. Maybe the bank of mum and dad should prepare itself for another withdrawal? Or, we could see many left with little choice but to live with their parents well into their 40s.”

Maundrell insists: “The Government needs to take action; without intervention, the spiralling cost of deposits and rent could have a huge economic impact on the UK. Giving renters a lifeline is equally as pressing as helping people buy a house. Taking steps to address this now could be a far easier solution than dealing with the prospect of pricing home hunters off of the private rental ladder.”1

How do you see the upcoming changes to landlord finances affecting how you set your rent prices and deposit requirements?

Advice for landlords on setting the perfect rent price can be found here: https://www.justlandlords.co.uk/news/setting-perfect-rent-price-property/

1 https://www.landlordtoday.co.uk/breaking-news/2016/3/are-people-being-forced-off-the-rental-ladder

 

Are £514m Worth of Tenant Deposits Unprotected?

Published On: January 28, 2016 at 3:01 pm

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Categories: Landlord News

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According to finance website Money.co.uk, 284,000 landlords have failed to protect their tenants’ deposits. This would mean that £514m worth of deposit money is unprotected.

The site has also called for a national register of private landlords.

The Centre for Economics and Business Research (Cebr) was commissioned to conduct the research into deposit protection on behalf of Money.co.uk.

Are £514m Worth of Tenant Deposits Unprotected?

Are £514m Worth of Tenant Deposits Unprotected?

The study found that with around one in five (4.6m) UK households living in private rental accommodation and the average protected deposit being £1,040, the total value of tenant deposits placed in protection schemes by landlords has now hit a huge £3.2 billion.

However, despite the risk of fines for landlords who do not protect their tenants’ deposits, Money.co.uk claims that 15% are still failing to do so. It says that these landlords are earning up to £8.5m a year in interest on unprotected money, while leaving themselves and their tenants with no third party protection when their tenancy agreement comes to an end.

It is compulsory for all landlords to protect tenant deposits for Assured Shorthold Tenancy agreements (ASTs) through one of three Government-backed tenancy deposit schemes, within 30 days of receiving the payment.

Landlords must then provide their tenants with prescribed information detailing who their deposit is protected with, who they are renting from and how they raise a dispute if necessary.

The three schemes – the Deposit Protection Service, the Tenancy Deposit Scheme and My Deposits – give landlords and tenants access to a free dispute resolution service if an issue does arise when the tenant moves out. In many cases, this eliminates the need for court action.

The Editor-in-Chief at Money.co.uk, Hannah Maundrell, explains the importance of protecting tenant deposits: “Renting is a money minefield, and with troubled times ahead for the buy-to-let market, the problems caused by dodgy landlords are only likely to get worse.

“While many landlords are doing the right thing and protecting deposits in one of the official Government-backed schemes, a worrying amount of money is falling through the cracks and far too many tenants are being left vulnerable.”

She advises: “Renters must take control and ask landlords which protection scheme their money will be stashed in before signing on the dotted line. Existing tenants must ask for proof their money is protected if their landlord hasn’t given them the correct written documentation.”

Maundrell would like to see changes to the legal system. She says: “It’s not right that tenants are left responsible for taking their landlord to court if their deposit hasn’t been protected. The Government needs to step in and take decisive action. Introducing a compulsory register listing every landlord that rents out property in England and Wales would be a start. This works for Scotland and Northern Ireland, and it seems crazy this hasn’t been brought in across the UK.

“Add in tenants’ ratings and reviews to this too and you have both the beginnings of a solution that helps renters make an informed choice about who they’re handing over buckets of cash to, and the foundation for policing landlords that are currently going unchecked.”1

All landlords must remember to protect tenant deposits – don’t get caught out!

1 https://www.landlordtoday.co.uk/breaking-news/2016/1/money-site-claims-landlords-sitting-on-514m-of-unprotected-deposits

 

 

Homebuyers and Tenants Warned of Deposit Scam

Published On: January 11, 2016 at 10:36 am

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Categories: Property News

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Online fraudsters are stealing millions of pounds from property buyers and vendors in a conveyancing scam.

The crimes are reported to be growing and are worth an average of more than £112,000.

Homebuyers and Tenants Warned of Deposit Scam

Homebuyers and Tenants Warned of Deposit Scam

Estate agent Chestertons is so concerned by the scams that it has compiled a list of tips for sellers and buyers to avoid the fraud, which cons those moving home out of their deposits.

Chestertons warns that similar scams could also hit private tenants waiting to sign tenancy agreements and pay deposits and rent.

Police believe that foreign crime syndicates could be responsible for the scams, by which criminals hack into the email correspondence between vendors, buyers, solicitors and estate agents.

The fraudsters then send an authentic-looking email, often on the day of completion, telling the buyer or the buyer’s solicitor that the bank account details of the conveyancer have changed. The criminals then empty the bank account with the new details.

Action Fraud reports that there were 91 of these cases up until October last year – the last month for which data is available.

In September and October alone, 16 cases were reported.

The Deputy Head of Action Fraud, Steve Proffitt, comments: “We are getting more and more instances of this. The outcome for the fraudster is tremendous. They can earn £1m on the sale of a house in the South East.”1 

Chestertons advises home movers – including tenants – to only give out sensitive information, such as bank details, over the phone or in branch, not over email.

It says that house hunters using property portals to find their next home should be especially wary of registering to receive details.

The firm warns that cyber criminals are very aware of the timescales involved in buying homes and know when deposits, including tenancy deposits, are likely to be transferred.

It insists: “You should be careful about how much information you share, especially if there is no pre-existing relationship with the firm that you’re contacting.

“Remember to give just enough details for agents, surveyors or lenders to get in touch with you as required and understand your basic requirements. Do not give any bank details.”

Read the full guide here: http://www.chestertons.com/research-and-insight/insights/chestertons-guide-to-avoiding-cybercrime-during-a-property-transaction/

1 http://www.propertyindustryeye.com/property-frauds-escalating-as-buyers-and-tenants-are-robbed/

 

Most Tenants Believe Landlords Do Not Protect Deposits

Published On: October 16, 2015 at 1:25 pm

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Most Tenants Believe Landlords Do Not Protect Deposits

Most Tenants Believe Landlords Do Not Protect Deposits

The majority of tenants (80%) believe that their landlord has not protected their deposit in one of the Government’s approved schemes, according to a recent study.

The research, conducted by online letting agent PropertyLetByUs.com, also shows that just 4% of renters say their landlord or letting agent placed their deposit in a scheme within 30 days of receiving it.

Additionally, only 8% of tenants have been given a receipt for their deposit and one in six tenants do not know who to speak to regarding concerns they have about deposits.

It is a legal requirement for landlords or their agents to place a tenant’s deposit within a Government-approved scheme within 30 days of receiving it. According to PropertyLetByUs, many landlords and agents may be abiding by the law, but they could do more to reassure renters that their deposits are safe.

Managing Director of PropertyLetByUs, Jane Morris, comments on the findings: “Many tenants don’t realise that they can log into the deposit scheme websites to see if their deposit has been placed with them. Landlords could also provide tenants with a copy of the confirmation produced by the tenant deposit schemes.

“There will be rogue landlords out there that are completely ignoring their legal responsibilities and the punishment is very costly. Landlords face fines for not registering deposits with a scheme, such as the Deposit Protection Service, MyDeposits or the Tenancy Deposit Scheme. Fines are unlimited and are worked out at three times the initial deposit.”1 

Remember to check our latest news for any recent landlord law changes and updates.

1 http://www.propertyreporter.co.uk/landlords/deposit-worries-for-majority-of-tenants.html

 

 

 

 

 

 

Students Most Likely to Lose Tenancy Deposits

Published On: September 23, 2015 at 9:32 am

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Students Most Likely to Lose Tenancy Deposits

Students Most Likely to Lose Tenancy Deposits

Students are some of the most likely tenants to lose part of their deposits at the end of their tenancy, due to leaving the property in an inadequate condition, according to new research.

A study by the Deposit Protection Service (DPS) reveals that less than one in three students, or 27.5%, receive 90% or more of their deposit back at the end of their tenancies, compared to over 57% of tenants as a whole.

The most common reason for deductions to a tenancy deposit among students was cleaning at 32%, followed by repairs at 27%, redecoration at 20% and the replacement of lost or damaged items at 19%.

The DPS has 12 tips for students to hopefully help them receive their full deposit back when they leave their rental homes.

Managing Director of the DPS, Julian Foster, says: “Students must be aware of their responsibilities as tenants and act accordingly throughout their tenancy, or risk losing money when they move out.

“As well as asking their landlord to confirm where their deposit is protected, taking simple steps such as checking household inventories and communicating regularly with landlords can help ensure that deposits are returned in full.

“Deposit protection means both landlords and tenants can have peace of mind that the money is safe, and that there is a free, impartial adjudication service if the tenancy ends in a dispute.”1

As the academic term begins, the DPS has created a video aimed at students, offering advice on how to avoid losing their deposits. View it here: https://www.youtube.com/watch?v=NivXVALXTfk

1 http://www.propertyindustryeye.com/students-warned-over-losing-rental-deposits/