Deposit Scheme Protection

publication date: Sep 12, 2011
author/source: Kate Faulkner, Property Expert and Author of Which? Property Books

Deposit Scheme Protection

DPS shows 10% growth as rates stay low

Over the past three months the DPS have seen a marked increase in landlords and letting agents registering with their service.

There are now 22,000 letting agents and 250,000 landlords registered with the scheme which safeguards 760,000 tenants' deposits worth £590 million.

Kevin Firth, director of The DPS said: "This is representative of the growing number of landlords forced to rent their properties rather than sell them. The increased demand for rental properties means higher rents and larger deposits. It's therefore more important than ever to ensure that landlords are protecting deposits as there is so much more at stake.

Kevin continues, "I am not surprised that there has been a considerable increase in registrations over the last few months. With bank rates likely to remain low for the foreseeable future even landlords and agents with very large property portfolios are turning to us for free deposit protection rather than pay the fees charged by the insurance schemes."

Kate Faulkner of independent property advice site Designs on Property says, "If all letting agents advised any tenant making enquiries about renting a property, were advised to make sure deposits were protected in a third party scheme, then many rogue landlords would not be able to let properties at all. It would also make it more difficult if not impossible for criminals who claim to have a property to rent to take cash deposits off people and then run off with them. The tenant deposit schemes are there to look after tenants' deposits and help make sure tenants' rent from a reputable landlord and/or letting agent it is a responsibility of all tenants to make sure they never ever hand over money for a deposit without a receipt and without knowing which tenant deposit scheme it is protected in. Any landlord or letting agent that says they take two months rent up front instead of a deposit is likely to be breaking the law and tenants are well advised not to rent from anyone offering this as an alternative.

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