Average tenancy deposit in England and Wales is rising
According to the Deposit Protection Service, the average security deposit paid by tenants in England and Wales is £967.84, with London properties demanding the most expensive deposit in the country at an average of £1,756.16.
Sunderland recorded the lowest average deposit at £467.32, three times lower than London.
Many landlords will request a deposit when agreeing a tenancy on their rental property to provide a level of protection should the tenant breach the terms of the tenancy, cause damage or fail to pay rent, the landlord would then be able to make appropriate deductions from their deposit.
Landlords or letting agents who take a deposit on an assured shorthold tenancy, in England and Wales, must register the deposit with one of the three government backed insurance or custodial schemes, within 30 days of receipt. Custodial and Insurance based schemes are operated by My Deposits, Deposit Protection Service and the Tenancy Deposit Scheme.
An insured scheme allows the landlord or letting agent to hold the deposit during the tenancy but in return they must pay a protection fee to the scheme.
A custodial scheme will require a landlord or letting agent to hand over the deposit for protection for the duration of the tenancy, with no fee attached. This scheme is funded on the interest earned from the deposit pool.
Northern Ireland and Scotland have separate deposit schemes. The schemes available in Northern Ireland include; Deposit Scheme Northern Ireland, MyDeposits Northern Ireland and Letting Protection Service NI. Scotland’s three appointed schemes are; Letting Protection Service Scotland, Safedeposits Scotland and MyDeposits Scotland.
Julian Foster, managing director at The Deposit Protection Scheme, said: “Over the last ten years the DPS has protected almost five million deposits across England and Wales, and we’ve generally seen deposit sizes increasing during this time.
“Tenants need to consider that the deposit for their next property may be greater than the sum protected for their current residence and plan ahead so that they can make the house move they want to make without any financial barriers”.
He added: “Whatever the cost, both landlords and tenants are assured peace-of-mind during their tenancy and fairness when it ends when using the DPS’ popular, easy-to-use and ultra-secure systems.”
Full article available on LandlordTODAY: https://www.landlordtoday.co.uk/breaking-news/2017/1/average-tenancy-deposit-edges-closer-to-1-000