Tenant deposits capped at five weeks’ rent as Bill makes its way through the Lords
Thousands of landlords will only be able to impose deposits of five weeks’ rent after amendments to the Tenant Fees Bill were approved by peers in the Lords.
The measure affects properties where the annual rent is less than £50,000, with the five-week cap increasing to six weeks’ rent on properties with an annual rent above that figure.
But there are concerns within the industry that the cap will leave hard-hit landlords with less protection than ever before.
Paul Barnes, head of dispute resolution at Kirwans law firm said that the decision to limit the deposit to five weeks means that landlords are likely to let only to those tenants they believe to be low risk in terms of rent payment and general property maintenance.
Paul said: “While there is clearly a need to make renting an affordable option to the many people who either can’t afford or choose not to buy their own homes, there also needs to be a recognition that landlords can’t be expected to foot the often costly bill that can come with having to repair a damaged property at the end of a tenancy.
“In addition, there are often cases whereby the tenant either can’t or won’t pay their rent, and many claim it is unfair to limit their protection of non-payment to little more than a month.
“Government ministers previously argued that a six-week cap was a good balance, so some landlords are confused and angry that the cap has been reduced even further.”
Other changes due to come into force as part of the Tenant Fees Bill include the banning of all letting and agents’ fees charged to tenants by agents and landlords in England.
The government claims that the Bill has the potential to save tenants in the private rented sector hundreds of pounds as well as making the market more transparent.