The decision from the Government to bring tenancies worth up to £100,000 per year under the tenancy deposit legislation is a great one. Tenancy deposit legislation previously only covered Assured Shorthold Tenancies up to £25,000. Tenancies valued higher than this had no requirement to be protected under a deposit protection scheme.
However, from October this year, deposits up to £100,000 will also need to be protected. This closes a loophole that, since the legislation came into force in 2007, left many of the most vulnerable tenants, like students or large house-shares, with no protection.
It’s a common assumption that people living in high value rental properties are rich and successful, but this is often not the case.
Students, for example, will form groups and move into large houses, paying a combined rent that easily exceeds £25,000 annually. People working hard to get through university should be given the same protection as young professionals or families renting a smaller house.
The Government move to expand the deposit protection scheme is the right thing to do and it’s estimated to bring another 15,000 new tenancies under the umbrella of deposit protection.
The DPS will have no trouble coping with this increase in deposits – we’re wholly confident that we will deliver a smooth service for landlords and tenants and can offer total protection for all deposits.