Rogue Landlords Update as Homeless Crisis Deepens

ROGUE LANDLORDS ALERT - Is your tenancy deposit protected?

The latest research from Ome has highlighted the huge sums of tenant deposit money that are unaccounted for and could be unprotected as a result of rogue landlords or agents not depositing them in a deposit protection scheme.

The research shows that: -

• * There is an estimated 3.5m deposit that is protected across the rental market which equates to some £3.9bn in value!
• * This means that with 3.5m protected tenancy to a value of £3.9bn, the average tenant is paying £1,139 for a tenancy deposit.
• * The latest English Housing Survey report released last week, shows an estimated 4.60m tenancies in the private rental sector in 2019.
• * With only 3.5m of these tenancy deposits accounted for in protection schemes, there are some 1.1m tenancies that either have not had a deposit protected, do not have deposits, or are using deposit replacement products.
• * At worst, this means there could be as much as £1.2bn in deposit monies that are not protected.
• * However, the latest report into deposit protection compliance rates by the Center for Economics and Business Research (CEBR) estimates that 14.5% of all deposits held are not protected by landlords or agents.
• * This means of the estimated 1.1m tenancy deposits that are unaccounted for, just over 500,000 (14.5%) cash deposits could currently be unprotected, putting £578m at risk.
• * This suggests there are still some 586,000 tenancies in the private rental sector that are neither compliant nor unprotected, suggesting a growing preference amongst landlords to ditch the traditional cash deposit and opt for deposit alternatives or no deposit at all.
• * But those 500,000 landlords across the nation that have taken a deposit and failed to place it in a compliant protection scheme run the risk of fines of up to three times the deposit plus the deposit itself.

* At £1,139 for the average new deposit, it could cost them to the tune of £4,556 per unprotected deposit!

Image: Peter Rachman

ABC Note: Perec "Peter" Rachman (16 August 1919 – 29 November 1962) was a Polish-born landlord who operated in Notting Hill, London, England in the 1950s and early 1960s. He became notorious for his exploitation of his tenants. 

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