Tenancy deposit schemes appear to be a waste of time

fishpond

I will hazard a guess and say their are upwards of 3 million renters in the U.K.
There are 3 deposit schemes where the companies hold the deposit.
For ease of working out, I will say that 1/2 of all tenants deposits are held by these schemes, the other 1/2 being insured.
There leaves 1.5 million deposits held by 3 companies.
So each company deals with .5 million deposits every year.
If we say 1/2 of these are not disputed, that leaves 250,000 in dispute with each company every year or 685 per day.
I do not think the biggest majority of these are even looked at and are just rubber stamped.
Which may go some way to explaining some of the outcomes.
I suppose there is the option of bypassing the deposit schemes and going straight to the courts where all of the evidence may get read.
Please put in the correct figures if you know them.

Pixie5740

You think they're a waste of time as a landlord but having been on the other side of things I wholeheartedly support deposit protection. You've clearly never tried to get a deposit back from some !!!!!! landlord who acts as though the money is theirs. Since deposit protection was introduced I haven't lost a single penny of my deposits whereas before it was a a fight to get anything back. We see it time and time again on this board where landlords don't understand betterment or think that "professional cleaning" actually means something.

If you want to clog up the courts with tenants fighting for the return of their money go right ahead. However, won't that mean it will take even longer to get a date for a possession order hearing?

theartfullodger

Their great value is merely being there, ensuring the arrogantly gready landlords who just held onto the deposit in the "good old days" safe in the knowledge very few tenants would risk suing via the courts no longer profit unethically from their sins.

Artful

saajan_12

This is the idea behind 'possession is nine tenths of the law' before you even get to their dispute resolution. Previously with the LL holding deposits, some would fairly return to tenants but some could just ignore tenant requests or make up costs to keep it in which case the tenant would have to go to court to recover. Court requires basic knowledge of the process, time, and a filing fee upfront, which a tenant may shy away from however strong their case is due to the hassle / risk.

Now, those LLs using custodial schemes have an extra hoop to jump through must atleast present a breakdown to get the deposit from the scheme. This would prevent atleast some who were hoping to just ignore it and walk away with the deposit.

SnooksNJ

theartfullodger wrote: »

Their great value is merely being there, ensuring the arrogantly gready landlords who just held onto the deposit in the "good old days" safe in the knowledge very few tenants would risk suing via the courts no longer profit unethically from their sins.

Artful

I think another great value is having the ability to damage or not pay rent on a property and then threaten to sue for up to 3 times if the deposit is not protected.

itchyfeet123

fishpond wrote: »

Please put in the correct figures if you know them.

What's the point of a post like this when you're just making up numbers? Especially when the actual numbers are so easy to find.

fishpond wrote: »

I will hazard a guess and say their are upwards of 3 million renters in the U.K.

In 2015, there were about 5mill households renting privately. This number is likely to have increased since then. You pose the question in terms of people, but if we're interested in deposits, then households is a more meaningful unit of measurement. If you really are more interested in people, then the number of people will obviously be greater than the number of households.

fishpond wrote: »

There are 3 deposit schemes where the companies hold the deposit.
For ease of working out, I will say that 1/2 of all tenants deposits are held by these schemes, the other 1/2 being insured.
There leaves 1.5 million deposits held by 3 companies.
So each company deals with .5 million deposits every year.
If we say 1/2 of these are not disputed, that leaves 250,000 in dispute with each company every year or 685 per day.

In 2013, the deposit services had about 2.9m deposits. The link I provided upthread didn't provide an estimate for the number of rentals in 2013, but they had 4.3 in 2014-15 and 3.9 in 2011-12. So let's say somewhere in the region of 4.1m households. 2.9/4.1 is just under 75%.

I'm not going to spend time finding the distribution of deposits among the schemes. In total, 1.68% are disputed.

fishpond wrote: »

I do not think the biggest majority of these are even looked at and are just rubber stamped.

This is an assertion that google can't confirm or deny. It would take someone with inside and systematic knowledge to verify.

fishpond wrote: »

Which may go some way to explaining some of the outcomes.

I assume from the title you think an unreasonable proportion of deposit disputes end with decisions that are unfair to tenants or landlords or both. If you want to start a meaningful discussion, it would be helpful to have both some examples of bad outcomes, and some evidence of how frequently "bad" outcomes occur.

always_sunny

The only waste of time is renters who trash rental properties and are convinced that it's 'tear and wear'.
In other countries deposits also accrue interests (linked to the national bank) and are paid out to the tenant.

I rented twice in the UK (London) and both time my deposit was returned in full and swiftly.

Tygermoth

Another tenant here who prior to the deposit scheme used to just mentally write off the return of the deposit, as in all my years renting it was never returned. Never.


Once the scheme was brought in I had my deposit returned with no fuss and in a timely manner on three occasions.


Personally, I think its brilliant.

Red-Squirrel_2

I've only privately rented once, as a student, but more than 10 years on it still rankles that we moved into a house with toenail clippings, mouse droppings and sticky surfaces and moved out leaving a clean tidy house behind and still didn't see a penny of our deposit back.

I think the schemes are a great idea.

martindow

SnooksNJ wrote: »

I think another great value is having the ability to damage or not pay rent on a property and then threaten to sue for up to 3 times if the deposit is not protected.

The LL can easily avoid being sued by protecting the tenant's deposit.

Crashy_Time

https://www.lettingaproperty.com/landlord/blog/2017/04/thousands-of-landlords-agents-are-now-in-danger-of-rent-repayment-orders-being-sought-by-their-tenants/