The Burden of Rental Deposits

For many renters, the financial burden of rental deposits is a major challenge. The average deposit now exceeds £1,100, and delays in receiving previous deposits often force tenants to pay double this amount. A third of renters must cover a new deposit before their old one is returned, placing significant financial strain on those looking to move.

How Renters Are Affected

Nearly half of renters who need to move have had to rely on credit cards, loans, overdrafts, or borrow from friends and family to pay their new deposit. With more than £4 billion of rental deposits locked away across England and Wales, the government has recognized that this is an increasing problem that needs to be addressed.

Proposed Solutions for Deposit Reform

Property experts are urging the government to implement tech-driven solutions to ease deposit-related challenges, such as:

• Offering tax incentives to landlords who adopt alternative deposit solutions.
• Creating a central clearing system to manage all tenancy transactions.
• Establishing an independent adjudicator to resolve disputes between landlords and tenants.

How Can We Help?

At Ringley, we have been assisting landlords and tenants for nearly 30 years. To streamline the tenancy process, we developed PlanetRent, a planetrent.co.uk/blog/-lettings-managed-on-your-phone'>proptech solution that simplifies tenancy management. Recognizing the financial strain tenants face, PlanetRent enables landlords to offer deposit-free renting. Instead of a traditional deposit, tenants can pay the equivalent of one week's rent while landlords receive coverage for up to eight weeks' rent.

The Need for a Tenant Database and Independent Adjudication

We advocate for a searchable database of tenants who have previously lost deposit adjudications, ensuring transparency for landlords. Additionally, we support the establishment of a single independent adjudicator to resolve tenancy deposit disputes. Letting agents already manage extensive compliance responsibilities, including Ombudsman and Deposit Scheme memberships—extending similar oversight to private landlords would bring greater fairness to the sector.

Government Incentives and Transparency

To encourage deposit alternatives, the government should introduce tax incentives for landlords who opt for these solutions. Additionally, implementing a single clearing system for tenancy transactions would not only simplify the rental process but also help reduce undeclared rental income, ensuring greater transparency within the market.