|
“It seems to have
sneaked in unannounced but it’s
going to have a serious impact
because it marks a major shift in
the balance of power with everything
now being skewed in favour of the
tenant.”
The change has come
about following research showing
that many tenants claim that
landlords withhold too much of the
deposit when the tenancy agreement
ends.
Miss Dancer says the
government has reacted by clamping
down on all landlords.
The new regulations
are due to come into force in
October 1 and will apply to
properties rented out after that
date.
“Under the new
scheme, when a tenant pays a deposit
the landlord will have 14 days to
hand it over to a government
appointed private company.
Alternatively, he could keep the
money but would then have to
register with an insurance scheme
administrator who could reimburse
the tenant in the event of a
dispute.
“If he fails to enter into one of
these
arrangements then the tenant can
apply for a county court order
forcing him to do so. In these
circumstances, the court must also
order the landlord to pay the tenant
an amount equal to three times the
amount of the deposit. The landlord
won’t be able to evict a tenant
until such a dispute is resolved.
“It is quite
draconian. Landlords could
effectively be fined several
thousand pounds for failing to
comply within 14 days.
Miss Dancer said that
the law doesn’t offer any comfort to
landlords if the tenant withholds
the final month’s rent when he
leaves.
“The landlord won’t
be able to take the money he’s owed
from the deposit. He’ll have to go
to court to recover it. And if the
tenant and the landlord disagree
about how much of the deposit should
be retained against damage caused to
the property, the case will have to
go to arbitration involving further
time and costs.
“As if this isn’t
enough, the independent company that
runs the scheme will be able to
siphon off some of the interest
earned by the deposit money.”
The government
insists the changes are necessary to
protect tenants from landlords who
don’t repay deposits. But Miss
Dancer said the system seemed to be
punishing the responsible majority
for the actions of a tiny rogue
element.
“More than ever it’s
vital that landlords keep up to date
with changing legislation and make
sure they comply with the new
regulations. Failure to do so could
result in fines and court costs
running into several thousand
pounds.”
For further information contact Emma
Dancer, Solicitor, Tel 0115 988
6722, e-mail
Emma Dancer.
|
