New tenancy deposit rules come into effect in October 2010
Currently Assured Shorthold Tenancies worth over £25,000 are regarded as ‘contractual tenancies’ whereby property landlords do not have to legally protect the deposit. However, once this scheme is launched it is believed over 15,000 new tenancies will be brought under the umbrella of deposit protection that previously were left vulnerable to unscrupulous landlords…
Speaking on this coming change, the Deposit Protection Scheme is confident that this will lead to better property letting conditions for all tenants across the UK property market.
Whereas in the past it was believed that high valued tenancies were only for the rich and successful; changes to the property market have prompted many students to move into large property investments, where they often pay a combined rent that easily exceeds £25,000 a year.
Yet, despite these evident improvements, property advisors are still sceptical about deposit protection schemes, especially following the recent hikes from The Dispute Service who have raised their deposit protection fees by 400%.
Responsible for offering tenants legal protection in the event that landlords wrongly withhold some if not all of their deposit, many property investors are now being forced to shoulder the cost of these increased fees which has deterred many of them from investing in property again.
However, the National Landlord’s Association is fairly confident that these fee increases won’t detract from the tenancy deposit protection but will continue to encourage their success. Only time will tell…