In July 2008 I did a post called Tenancy Deposit Protection – 62% failure which was based on a survey done by the Deposit Protection Service (DPS), one of the three tenancy deposit protection schemes. This survey said that 62% of landlords were flouting the law and not protecting tenants deposits as they should under the tenancy deposit protection scheme regulations, which came into force in April 2007.
One year on, the DPS have done another survey, and this shows that the situation has improved. However 30% of landlords are still openly admitting that they are not registering deposits. This is despite the fact that any s21 notices served on the tenant will be invalid until the deposit is protected, and that the tenant can also go to court and claim a ‘fine’ of three times the deposit money.
The conclusion reached by the DPS is that the government’s idea of having a national register of landlords should be implemented. Many landlords however are stongly opposed to such a scheme.
Perhaps the best solutions would be
(1) to make sure that the requirment to protect deposits is widely known (so tenants are more likley question landlords this), and
(2) to make it easy for tenants to claim the penalty from non compliant landlords.
The the word is gradully getting out (which is probably why more landlords are now protecting deposits), but claiming the penalty award can still be a nightmare. The legislation has proved to be so problematic that no-one really knows where they stand. As can be seen from other posts about tenancy deposits on this blog!
What do you think is the best solution?
On the one hand, it's great that this problem was cut in half, but on the other, 30% is still staggering!!!
Very scary thought to know there is a 3 in 10 chance your Security Deposit could be squandered! That coupled with Landlords foreclosing on their Rental Properties, tenants should practically be allowed to run a Credit Check on their potential Landlords! lol