Landlords call on Government to revolutionise tenancy deposit system

The Residential Landlords Association  is calling for the creation of a new insurance-based scheme that would allow tenants to transfer deposits between properties.

The membership body is urging the Government to work with the industry to develop such a scheme on the basis that it would help both the landlord and tenant.

Under the proposal, a tenant would be able to top up or claim some of the deposit back, depending on the level of the deposit required on their next rental home, while a landlord would have assurances that a deposit would be available in full if the tenant could not top it up between tenancies.

The RLA said: “One of the biggest upfront costs that tenants face is the deposit. This is exacerbated by a system that means when a tenant moves to a new rental property they need to raise funds for a fresh deposit before being repaid the deposit for their last property.

“The existing Alternative Dispute Resolution mechanisms which deal effectively with deposit disputes would be maintained under this system.

“Implementation of such as scheme would require new primary legislation which could be included in the draft Tenants’ Fees Bill. It would need a new set of contracts with deposit schemes which would in turn mean running a new tender process.”


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  1. Gloslet

    ‘Alternative Dispute Resolution mechanisms which deal effectively with deposit disputes’ I wonder how many of their members have had experience of the ADR and agree with that statement ?

    As for an insurance based deposit replacement scheme, the entire basis of the insurance industry providing insurance is that they try not to pay out !

  2. RosBeck73

    If this could be made to work it would be an excellent development. This is a good use of the RLA’s time – coming up with constructive ideas which could massively help tenants, at no or very little cost to anyone.

  3. lettingsguru

    Another hair brain idea by RLA.

    Of course the utopian position is to top up and transfer from one property to the next, but the new LL will still require satisfaction that they will be able to top up.

    What if, the Tenant only thinks they are going to have £50 deducted only to find after check out and ADR it is £400, and they haven’t got that. I bet the new LL won’t be that please of the promise they can pay….

    The idea of a deposit is that it is property centric. Therefore in needs to be released from LL a to the Tenant, and then the Tenant can pay LL b, without any risk of top up.


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