In order to achieve more transparency and fairness in the rental market for tenants, MPs have called for the Government to make changes to the Draft Tenant Fees Bill – and reduce the deposit cap from six to five weeks.
Following the decision to ban agency fees, a report by the select committee states that setting the cap at five weeks might “deprive Letting Agents of an income source” but would help tenants. Following meetings with multiple interest groups, they decided that security deposits of six weeks’ rent would cause too much financial burden for tenants.
Only last week, the Residential Landlords Association (RLA), said that even a six-week cap on deposits wouldn’t be enough to cover landlords for cases where tenants fail to pay the final month’s rent. The chair, Alan Ward, said: “Policymakers need to address the problem of tenants who fail to pay their rent with as much energy as tackling rogue landlords.
“Proposals to lower the cap on deposits paid by tenants will play into the hands of the minority of tenants who cheat those providing housing for them out of the rent they are legitimately owed.”
Clive Betts, Housing, Communities and Local Government Committee chair, said: “[T]his legislation has the potential to make a difference to millions of people by cracking down on unfair fees and saving tenants hundreds of pounds.
“We believe however that there are clear improvements that could be made to the Bill that would ensure it has a much better chance of delivering on its aim of making renting fairer and easier.
“Moving home is already an expensive time and many people struggle to find large sums of money at the start of their tenancies to put down as a deposit. Lowering the cap from six weeks’ worth of rent to five will help make the private rented sector much more affordable, while also keeping protection for landlords from rogue tenants.”