TWO fifths of tenants are owed cash from their landlord because their deposits are higher than the cap.
More than 42 per cent of deposits held by the the Deposit Protection Service (DPS), which looks after renters’ down payments during tenancies, are more than the limit set back in June 1.
Deposits have been capped at five weeks’ worth of rent under the Tenant Fees Act 2019 that came into force two months ago.
Before, landlords could demand up to six weeks worth of rent upfront.
And while the cap doesn’t affect deposits handed over as part of an agreement taken out before it became law, landlords must refund the difference when a tenancy comes up for renewal.
That means you could be owed a week’s worth of rent, which housing charity Shelter says is £192 on average.
Ban on letting agent fees
THE Tenant Fees Bill bans letting fees paid by tenants in the private rented sector.
Housing charity Shelter says tenants shell out an average of £272 in fees, so this will save people a pretty penny.
But experts have warned that renters could still be open to being charged “default fees” – such as when they lose their key or breach their contract.
Under the rules, agents and landlords will still be allowed tenants fees associated with:
- a change or early termination of a tenancy requested by the tenant – but this will be capped at £50 unless the landlord or agent can demonstrate that greater costs were incurred
- utilities, communication services and council tax
- payments arising from a default by the tenant, such as replacing a lost key.
Landlords and estate agents will also only be able to recover “reasonable costs”.
For example, they won’t be able to charge tenants hundreds of pounds for a damaged item that actually only costs a few pounds to replace.
Matt Trevett, managing director at The DPS, told Property Industry Eye: “Our figures show that the tenancy deposit cap will eventually affect a significant proportion of properties around the country.
“Landlords and letting agents should be ready to make the change whenever a relevant tenancy ends in order to fully comply with the law.”
The five-week cap only applies to properties where the annual rent is less than £50,000 – anything more then you’ll still have to pay six week’s worth.
If the landlord doesn’t voluntarily offer the refund when you come to renew, then you are entitled to ask for it.
You won’t be refunded the difference if you’re not renewing the contract.
This is because you will get your deposit back after your contract has ended.
The landlord then has 10 days to return your cash to you if it’s been held in a government-backed scheme, such as DPS or the Tenancy Deposit Service, unless there are any disputes that may delay the deadline.
There is no time limit for when deposits must be returned if it isn’t protected, such as if you’re a lodger, student at university halls or if you have a assured or protected tenancy.
Most read in Money
If a landlord doesn’t pay up, you can report them to Trading Standards for free.
A new watchdog has been set up to make sure that rogue letting agents don’t rip-off tenants.
Renters still face forking out up to £2,500 for upfront deposits even after the cap as landlords hike prices.
We pay for your stories! Do you have a story for The Sun Online Money team? Email us at email@example.com