The tenancy security deposits that tenants leave with landlords or their letting agents will be capped at a maximum of six weeks rent, and not the five weeks that had been previously mooted as a possibility.
The details were included in the Tenant Fees Bill introduced into Parliament yesterday. The cap on security deposits was initially announced in November last year during the chancellor’s Autumn Statement.
The Housing, Communities and Local Government Select Committee‘s report into the government’s Draft Tenant Fees Bill had recommended that the maximum security deposits be reduced from the planned six weeks to just five weeks.
Tenancy deposits are being capped because the government believes that they cause a significant affordability problem for tenants.
Other key measures in the Bill, which reflects feedback from a recent public consultation and pre-legislative scrutiny from the Housing, Communities and Local Government Select Committee, include capping holding deposits at no more than one week’s rent.
The Bill also sets out the proposed requirements on landlords and agents to return a holding deposit to a tenant.
There will also be a cap on the amount that can be charged for a change to tenancy at £50 unless the landlord demonstrates that greater costs were incurred.
David Cox, chief executive, ARLA Propertymark, said that he was “pleased” that security deposits were being capped at six weeks, rather than the committee’s proposed five-week cap.