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Lifetime Deposits may be more complicated than government hopes

There’s a warning that the government’s pledge to introduce a lifetime deposits concept, theoretically making it easier and cheaper for tenants to move, could be more complicated than it first appears. 

The consumer website, Money. says that tenants have seen costs increase significantly in the past year, by 10 per cent to an average of £821 pcm since before the pandemic, according to Halifax. 

This is compared to an increase of mortgage costs by an average one per cent to £753 for those who own their own homes.


On top of rising rents, one of the biggest problems facing renters is the size of the deposit they need to save in order to move. This is an average of £1,054, according to the Office for National Statistics, which has to be paid in advance before moving into a new home, and before the deposit from a previous property is released.

Therefore Money says a lifetime deposit concept appears popular, but it warns there may be problems with implementation. 

James Andrews, senior personal finance editor at the  website cautions: “At first glance, the new plan for tenants’ deposits to move with them from property to property looks like an all-out win - but the devil will be in the detail.


“The first point to make is that not all deposits are equal - which means there needs to be a simple way to add to the amount you have.

“The second is that not all moves are seamless - what happens when there’s a gap or, worse, an overlap between one rental contract ending and another beginning.

“And finally - while the tenancy deposit protection scheme means a landlord can’t withhold your money, it doesn’t mean they can’t make deductions for damage.

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    No-one has yet explained how the time when a LL is assessing, calculating and disputing a charge to the deposit in the old house will be covered. I am certainly not taking on a tenant without a deposit because it has not yet been released by the former LL! Even when things go well there is upto 2 weeks before the deposit is released - and if charges are in dispute, much longer. How is this going to be covered?

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    I cannot see how this system is going to work, no tenant is going to get the keys to any of my properties until I'm holding a deposit, I'm not interested in promises, just hard cash.

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    It's not rocket science to suss out that lifetime deposits are not going to work. How can a tenant transfer a deposit to a new property when the deposit from property they are moving from hasn't been released?
    And then what if that deposit is claimed against for damages, cleaning etc. Possession already given up with effectively no deposit? No way!
    Deposits aren't a issue in the market place, so stop trying to fix a problem that is not broken....


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