- Readers Rating
- No Rating Yet!
- Your Rating
News of a possible deposit cap reduction by the government as part of the Tenant Fees Bill has been greeted with anger from Landlord trade bodies.
A report in the Sun newspaper has implied that housing secretary James Brokenshire has won a cabinet battle to reduce the proposed deposit cap from six weeks to just five weeks.
This will mean that landlords will only be able to take a maximum of five weeks deposit from tenants, even if they wish to bring pets with them.
The six-week deposit cap had been generally thought to have been agreed for the new Tenant Fees Bill, and landlord trade bodies have reacted angrily to the news of the possible cut.
David Smith, Residential Landlords Association policy director, said: ‘If this is true, landlords will feel badly let down by a government which says it wants to support good landlords. The government had accepted that a cap of six weeks was the minimum many landlords required. This is needed to address the problem of tenants who fail to pay the last month’s rent and leave a property damaged.
‘Ministers claim that they want to cut the cost of renting, yet this is another measure the government is taking that will further cut the number of landlords and properties available as demand continues to rise, so actually driving up rents up.’
The National Landlords Association were equally disappointed by the news. Their chief executive officer Richard Lambert said: ‘A six-week cap is the lowest landlords find acceptable. Does the government really not realise that if landlords don’t think the deposit covers the risk of damage or unpaid rent, they will be even more cautious about who they let to?
‘All this will do is make it harder for tenants with poor credit ratings or who want to have a pet to find a suitable home. This is clearly a political move aimed at the renters’ vote. It is not a policy for business.’
Around one in three renters who currently pay a deposit are set to be affected by the deposit cap change, with the new cap applying to properties where the annual rent is less than £50,000.
In addition to the deposit cap reduction, other amendments to the Bill include limiting the type of default fees that can be changed by landlords and property agents. This means that during the tenancy, landlords and agents will only be able to charge fees to replace lost keys or for late rent.