Which? report throws deposit system under spotlight

A recent report by consumer group Which? has revealed that on-in-six tenants are being ‘forced in to debt’ due to the broken deposit system, after having to wait up to four weeks for the return of their deposits.

Following the research, the group are calling on the government to open a review of the three government-approved deposit adjudication schemes - MyDeposits, Deposit Protection Service (DPS) and the Tenancy Deposit Scheme (TDS) – and are looking for an overhaul in the process, starting with landlords and agents.

Which? would like to see all landlords registered with their local authority, providing information to be detailed on a public database. This should be linked to the current database of rogue landlords and agents. They believe that agents also need to be policed, with an independent regulator put into place to oversee lettings and managing agents, and a legally binding code of practice to abide by. This would come with strong penalties for poor practice.

The research that prompted such keen action highlighted issues such as the wait that some tenants face to get their deposits back, and the impact that this can have on their next move, if that have to find the money for a new security deposit, or payments for a house purchase - 31% of tenants have to pay out again before seeing the return of the original deposit, said Which?.

According to the report, 43% of tenants surveyed revealed that they had taken on credit card debt, a loan or an overdraft, or else borrowed the cash from friends or family to cover the expenses that they faced following a deposit challenge, with more than half who did not see their deposit returned challenging the decision. Issues with the cleanliness of the property on check out remained the biggest reason for a deposit deduction.