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TODAY'S OTHER NEWS

Average tenancy deposit now stands at £1,139

The average tenancy deposit paid by tenants in Britain now stands at £1,139, fresh analysis from Ome, part of Hamilton Fraser, shows.  

The letting deposit replacement scheme reports that the amount of money tenants are now paying in a rental deposit is 5% higher than the £1,088 paid in 2014.

When looking at the cost of a deposit compared to the inflation of other everyday costs, the figures show that deposits have increased at a lower rate than many other costs of living. 

The cost of a basic TV package, such as Sky or Virgin, for instance, has increased from an average of £22 to £28 in the last five years, the largest increase at 26%.

While the cost of renting has increased, it’s the cost of buying a home that has seen the second largest increase in the last five years, up 24% to the current average residential property price of £231,265.

Matthew Hooker, co-founder of Ome, said: “The rental sector has received a fair share of negative press in its time and much of this has been focussed around the traditional deposit and the sums charged by agents at the start of a tenancy in order for a tenant to secure a property.

“However, with the recent Tenant Fee Act shining a light on the fees charged by traditional letting agents, it’s interesting to see that in relative terms, the increase in the value of tenant deposits is actually smaller than the increase seen in our TV packages, mobile contracts, Big Macs, and even the growth in the average UK salary.

“So it would seem that it is the cost of living within a property itself that is putting the greatest financial squeeze on the nation’s tenants, with the actual deposit only proving a problem for those unable to accumulate the large initial sum, or finding themselves short for other areas of life once they have.

“Of course, many of these other costs are either small or provide the option to pay in installments with the deposit being the last major cost that can’t be widely tackled in bite sized chunks. That’s why we’ve seen a number of deposit alternatives enter the market in order to provide this choice and allow tenants to stay on top of the climbing costs elsewhere in life, by opting to pay their rental deposit on a more manageable monthly basis.”

Variable

Five year change (2014 - 2019)

Basic pay-TV price (monthly)

26%

Average house price

24%

Mobile usage price (monthly)

22%

Big Mac

19%

Car insurance premium (annual)

15%

UK Net Salary

12%

Gold

10%

Pint of beer

10%

Cinema ticket

6%

Tenancy deposit

5%

Home insurance premium (annual)

4%

Unleaded petrol (pump price)

-2%

Sources

Rental Deposits

Ome

source1 - Ome unique data

TDS

source2 - TDS statistics

Car insurance

Money supermarket

source3 - car insurance

Home insurance

Money supermarket

source4 - home insurance

Mobile phone & TV costs

Ofcom

source5 - communications pricing statistics

Average house price

Gov/Land Reg

source6 - Ave House Price

Gold historical prices

Bullion by post

source7 - gold historical prices

Cinema ticket statistics

Statista

Petrol prices

RAC

source9 - petrol historical prices

Price of a pint of beer

ONS

Big Mac price statistics

FM

source11 - Big Mac historical prices

BL

source12 - Big Mac current prices

Average salary data

ONS

source13- Average salary data

  • icon

    Having been an active LL for well over thirty years, the cap of deposit and increasing interference / threat of petty legislation has led me to accelerate my gradual exit from letting good quality properties. There have been numerous occasions when prospective tenants have been unable to “get over the line”in terms of financial box ticking but have demonstrated decent Christian values and a willingness to lodge higher deposits than normal. Also we have often “vetted ‘ prospective tenants dogs with a view to waiving our no pets clause along with larger deposits to cover potential dog related damage such as door scratching ,hole digging in the lawns and straight forward carpet damage.. The pleasure of providing good quality product in a mutually beneficial manner is being eroded. The governments demonstrate a desire to see corporate , faceless landlords at the expense of the more traditional , maybe old fashioned , small portfolio entrepreneurs.
    I was very disappointed (to put it politely) at the ease at which the NLA capitulated to the governments demand for a 5 week deposit cap. This has caused numerous tenants to be unable to rent the quality houses they desire and ultimately will lead to less “above average’ properties on the open rental market.

  • Paul Barrett

    It is LL like you that should be listened to.
    You could give these dopey Govt advisers a few lessons on how things actually work.
    If they did that some sane policies might evolve.
    .But you know that ain't ever gonna happen.
    Your totally pragmatic response of now gradually exiting the industry makes total sense...............unfortunately!!

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