There has been a significant increase in the number of no deposit tenancies, according to flatfair.

The deposit alternative specialist reports that there was a 30% year-on-year rise in no deposit tenancies in May.

It also says that 14% more landlords are using their no deposit product compared to the same time last year.

Throughout the month, the company says the average flatfair tenant saved £1,243 on their up-front moving costs at a time when rent prices (and, therefore, traditional deposits) continued to rise.

Instead of the traditional deposit of up to five weeks’ rent, flatfair charges a fee of a week’s rent plus VAT.

Gary Wright, chief executive officer of flatfair, said: “At a time when tenants continue to suffer financial hardship because of the cost of living crisis, this considerable saving on upfront moving costs is proving increasingly popular to tenants and to letting agents.

“A letting agent recently processed 170 student tenancies using flatfair deposits. By offering our deposit alternative alongside the traditional system, their students had the option to save hundreds of pounds on their upfront move-in costs.

“At the same time, the agent benefited from significant time savings in administration tasks and improved compliance.

“With traditional deposits, agents face the risk of manual errors and missed deadlines during registration and reconciliation – potentially costing up to three times the deposit amount. When managing numerous deposits simultaneously, these risks and the administrative burden increase significantly.

“flatfair deposits automates the registration process, collecting deposits via open banking and instantly lodging them with the agents’ preferred deposit provider.

“This saves the agent considerable time and reduces errors – especially when processing multiple tenancies.”