A property industry trade organisation has outlined how lifetime deposits might work, ahead of the publication of the Renters’ Reform Bill next year.

Propertymark believes that these should be known as a tenancy deposit passport rather than a lifetime tenancy deposit – otherwise it implies that the tenant will spend their whole life renting.

It has come up with suggestions in The Future of Renting position paper which also includes proposals on energy efficiency targets and digitalising possession claims.

It says tenant deposit passporting should include a range of options such as a tenant guarantee bridging loan or insurance policy via a tenancy deposit scheme, deposit builder ISA, and encouraging employers to offer a deposit loan scheme.

With a tenant guarantee arrangement, once a tenant has paid a full deposit and they move on and rent another property, the deposit protection scheme retains the money, any deductions are made, and the remaining money is held by the scheme for the next tenancy.

The tenant buys an insurance policy or gets a bridging loan from the scheme which is used to claim against any deductions.

Alternatively, a government-protected savings pot could be made available to renters using a deposit builder ISA.

Applicants would be able to demonstrate that the funds were in the account at the start of the tenancy and the account could be associated with a tenancy deposit scheme to resolve disputes. Tenants would also be able to save in this account, eventually using the funds for a deposit to buy their own home.

Work loans

According to Propertymark, the government should be doing more to encourage employers to offer staff an interest-free loan to pay for their deposit.

It says that with a deposit loan scheme, companies and organisations would be provided with guidance on how to package financial wellbeing benefits and information to employees in a more helpful way. Repayments could be made in instalments via deductions from a tenant’s monthly salary.

It also believes there could be wider use of deposit bond schemes – a written agreement between a local authority, the landlord or letting agent and the incoming tenant.

Hotly awaited

“The update from the government in respect of ‘lifetime deposits’ is hotly awaited by landlords, tenants and agents alike,” says CEO Eddie Hooker (pictured) of Hamilton Fraser

“In reality, the solution may well be an amalgamation of all the ideas discussed in the Propertymark report.  But probably more important is the requirement to improve the current deposit regime, making deposit protection more transparent, easier to administer and quicker to release deposits.”

Read the report in full.


  1. What a load of tosh – stop meddling with everything.

    Fred has a £500 deposit lodged, moves out but 30% is correctly deducted so Fred has 70% or £350 is left.

    Asuming he gets a reference and can get another rental, that deposit is £700 – but Fred only has £350.

    OR perhaps Fred takes out an insurance Policy to keep his Deposit at £500, he’s still deducted 30% but its ok his insurance covers it.

    Oops Freds insurance has now gone up because of his “claim”, the new deposit is £700 so he has to up his insurance again.

    Only the insurance Company wins.

    OR Fred has his insurance policy and applies for a new property. His new LL believes Fred has £500 cover but doesnt know Fred is about to lose 30%.

    OR Fred just doesnt bother paying his insurance once he’s got his Tenancy so the LL is screwed when 30% is due to be deducted.

    A farce !!

    • Agree – If prospective tenant can’t raise the deposit from cash savings, then they don’t have any ‘rainy day’ savings so what happens when they lose job/long term sickness without full company sick pay etc? NO RENT or ARREARS!

  2. How is this going to work?

    I have a tenant leaves the property on 30 November. He has a deposit, but owes me rent and has done some damage.

    Starts new tenancy 27 November. So the deposit, would have moved to the new landlord. Where is the protection / deposit for me?

    Also, if the tenant runs away… what happens to their deposit?

  3. Have I missed something here? Extra bureaucracy and cost. Time and money would be better spent advising tenants how not to mess up a property (excluding fair wear and tear, of course) so they get their full deposit back and can move on with the dosh and a good reference.

  4. When I worked in Holland a much simpler and better system applied there. Before the tenant moved in a government inspector checked the flat etc was of a decent standard and took photographs also recording the tenants ID number. When the tenant moved out the inspector returned and if everything was not exactly how the tenant found it repairs were authorised and the cost recovered direct from the tenant’s income/ benefits. Tenants tried really hard to look after their properties. In my experience here a tenant will often say “I’ve stopped my standing order so you can use my deposit for the last month’s rent” or if they have completely trashed the place and done a runner with several months of unpaid rent by the time you are granted possession the bond barely scratches the surface. Good tenants get their bond back anyway so I often return the bond after they have lived in the property for a year to avoid all the bureaucracy and it’s surprising how much good will it creates.

    • a lot of tenants do the skip last months rent, use the deposit thing so they can 1. have the money faster, 2. limit the amount left that a landlord/letting agent can screw them over by making false claims.

  5. Everything I have read in the featured latest so called “improvements of the PRS” only serve to highlight how little, as in nothing, these various departments know of the reality of being either landlord or tenant.
    I keep saying it but when, if ever, are these people who come up with these idiotic pronouncements going to be forced to spend several months actually experiencing the reality of life as Landlord/tenant.
    As far as that proposed lifetime deposit scheme, just a paper exercise, if they really want to do anything at all to help tenants and landlords then reforming the Housing Benefit system of payments so that those LLs who do take HB tenants do actually receive rent.
    At the moment it is looked on as another source of money for use on anything except for paying the rent by too many, and they are genuinely puzzled why LLs are reluctant to take tenants on HB.

  6. “It says that with a deposit loan scheme, companies and organisations would be provided with guidance on how to package financial wellbeing benefits and information to employees in a more helpful way. Repayments could be made in instalments via deductions from a tenant’s monthly salary.”

    Why not go one step further and Just like a child support order have Tesco pay the rent & deposit direct from the employees salary and continue to deduct monies due for damages after the tenant has left until all outstanding balances have been met???

  7. Personally, I think for once they are coming up with some ideas which could potentially be a great help to tenants rather than an indirect way to cost them more money. At the moment it’s hard for tenants to move as they effectively have to have two deposits outstanding during the crossover. I’ve already been accepting a deposit insurance scheme for some tenants and it works really well. I don’t have to handle any deposit money for a start, so it’s less work for me. I don’t see the reason for landlords to be griping about these suggestions as we won’t be the ones having to administer them and for once we won’t be worse off.


Please enter your comment!
Please enter your name here