The publication of results from The Deposit Protection Services (The DPS) Tenancy Deposit Ratings for April to June 2016 have been revealed, highlighting that tenancy deposits have nearly broken through the £1,000 barrier.
In nearly all cases, tenants will pay their new landlords a deposit when they move to a new rental property – to insure against damage or other costs while living at that address.
By law, landlords must then protect this deposit in one of the three government-backed tenancy deposit schemes: namely the Deposit Protection Service (DPS), the Tenancy Deposit Scheme (TDS) and mydeposits.
This has been the case since 2007 and landlords who fail to protect their tenants’ deposits could face court orders or fines.
The findings from the DPS showed that those renting a new home in England and Wales between April and June of this year had to pay on average £970.48 as a deposit when moving in.
This is a 4% (£41.50) rise compared to January to March, when the average deposit stood at £948.31, and a 12% (£102.59) increase on April to June 2014, when the average deposit was only £867.89.
As you would expect, the capital leads the way on the most expensive deposits paid by tenants. The average for properties with postcodes in London (£1,799.11) was the highest in the country.
This replaced the Kingston-upon-Thames ‘KT’ postcode – bordering Surrey and London – which had been the most expensive between January and March.
At the other end of the scale, properties with Durham’s ‘DR’ postcode were the cheapest in England and Wales. New tenants in this part of the North East had to hand over a deposit of just £467.76.
The top five was made up by areas in and around London. Twickenham, south-west London had an average deposit of £1,596.38, closely followed by Enfield (£1,562.97) and St Albans (£1,562.04).
As a landlord, the importance of protecting your tenants’ deposits – and placing them in one of the authorised tenancy deposit schemes – can’t be understated.
It gives both you and your tenants’ peace of mind, reducing the possibility of disputes, complications or issues at a later date.
When it comes to letting a home, you want things to go as smoothly as possible. Ensuring the safety of the deposits you receive will be one less thing to worry about.
If you are unsure about your responsibilities and obligations when it comes to tenancy deposits, speak to your letting agent for further advice and information.