Landlords react angrily over government’s deposit U-turn

Landlords_react_angrily_over_governments_deposit_U_turn

 

Landlords feel “badly let down” after the government announced a five-week rent cap on security deposits as part of sweeping changes being brought in to the buy-to-let sector.

 

The six-week deposit cap was thought to have been agreed as part of the new Tenant Fees Bill, a view mirrored by chancellor Philip Hammond who said he “could not agree” to the proposals, asking cabinet members to “hold the line” at six weeks.

 

But housing secretary James Brokenshire is reported to have “overruled” the chancellor and was pressing ahead with a five-week deposit cap.

 

Read more: What insurance do you need as a landlord?

 

Landlord bodies have reacted angrily to the government U-turn which they believe will penalise tenants through higher rents as landlords attempt to recover costs.

 

Tenants with low credit ratings or pets could also find it harder to rent as landlords would become “more cautious” about who they let their properties to.

 

David Smith, Residential Landlords Association policy director, said the government were ignoring issues such as tenants not paying rent and damaging.

 

Read more: Landlords waiting more than five months to repossess property

 

He said: “If this is true, landlords will feel badly let down by a government which says it wants to support good landlords. The government had accepted that a cap of six weeks was the minimum many landlords required. This is needed to address the problem of tenants who fail to pay the last month’s rent and leave a property damaged.”

 

Chief executive officer Richard Lambert from the National Landlords Association said: “A six-week cap is the lowest landlords find acceptable. Does the government really not realise that if landlords don’t think the deposit covers the risk of damage or unpaid rent, they will be even more cautious about who they let to?

 

“All this will do is make it harder for tenants with poor credit ratings or who want to have a pet to find a suitable home. This is clearly a political move aimed at the renters’ vote. It is not a policy for business.”

 

The new cap is set to apply to properties where the annual rent is less than £50,000.

 

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10th December 2018