Tenant Deposits Capped

Published: 07/05/2019 By Empire Estates

The new cap will apply from 01st June 2019 to all new and existing properties where the annual rent is less than £50,000. A deposit of 6 weeks’ rent will continue to apply where the annual rent is £50,000 or more.

On all new and existing tenancies where the deposit scheme holds more than 5 weeks deposit,  we are in the process of reimbursing the difference to ensure that we are compliant with the new regulations.

The move is announced as part of the Tenant Fees Bill becoming law on 01st June 2019. It is a further step by Communities Secretary James Brokenshire MP towards ending costly fees imposed on tenants when they first move into their property.

It builds upon comprehensive measures taken by ministers to increase protection for tenants in the private rental sector, including:

  • scrapping letting fees charged by both landlords and letting agents.
  • capping holding deposits at no more than 1 weeks’ rent and ensuring landlords and agents return holding deposits to tenants within 14 days.
  • capping the amount that can be charged for a change to a tenancy at £50 unless the landlord can demonstrate that greater costs were incurred.

The deposit cap of 5 weeks’ rent only applies to properties where the annual rent is less than £50,000. A deposit cap of 6 weeks’ rent will apply where the rent is £50,000 or greater. Properties where the annual rent is greater than £100,000 are out of scope.