The tenancy protection system in the UK should be transformed to a single, custodial non-profit provider to make life easier for tenants, according to Generation Rent.
The campaigning tenants’ group believes deposits should be pooled and invested, with the interest used to cover scheme running costs, as well as advice and advocacy for tenants, deposit ‘passporting’ - allowing tenants to transfer deposits from one tenancy to another - and a deposit guarantee scheme for low-income renters.
Its report on the sector, ‘Short-changed: making deposit protection work for renters’, explains: “While landlords and letting agents may benefit from any competition between the Tenancy Deposit Protection (TDP) providers and can profit from the interest accrued on some deposits, the system is needlessly complex for renters. The various schemes mean tenants find it difficult to understand rules and requirements.”
It says insurance-backed TDP schemes give providers less control when a deposit is disputed. “The fact that tenants cannot protect their own deposit by registering it with a scheme themselves, instead giving it to a landlord who chooses a protection scheme, complicates this situation further,” it adds.
Generation Rent believes tenants shouldn’t have to go to court for cases in which landlords/agents have not protected their deposit, or where their landlord has refused to accept adjudication or abide by its decision. Instead, they could use the First-Tier Tribunal or new Private Landlord Ombudsman.
Among its recommendations are requiring a landlord or agent to return a tenant’s deposit at the end of a tenancy, or to claim deductions on it, within 14 days; that deposits paid by lodgers and licensed occupiers (such as those in student accommodation) should be required to be placed in a protection scheme; and that tenants should be able to pay deposits in instalments, without a landlord’s agreement.
LandlordZONE has contacted the tenancy deposit schemes for comment.
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