The Tenant Fees Act 2019, introduced June this year, means thousands of tenants could be owed refunds on deposit fees.
This new Government-approved protection scheme has been introduced in an effort to make the rental market fairer. Tenants will be able to see, in the advertised rent, what a property will cost with no hidden costs. New legislation protects tenants from being charged large security deposits when they move in.
The Tenancy Deposit Scheme (TDS) say an average of £320.27 has been returned to renters who signed new contracts since the Tenant Fees Act 2019 came into force.
What change has the Tenancy Fees Act 2019 made?
The Tenant Fees Act bans most letting fees and caps tenancy deposits, paid by tenants in the private rented sector in England. The ban on tenant fees applies to new or renewed tenancy agreements, signed on or after 1 June 2019.
New guidelines mean security deposits are capped to a maximum of 5 weeks rent, for tenancies with annual rent of less than £50,000. Where annual rent is £50,000 or more, security deposits are capped at a maximum 6 weeks rent.
When the same tenancy is renewed, the landlord/agent must return any part of the deposit which exceeds this.
Thousands of repayments already made
Tenants who have paid a deposit higher than 5 weeks worth of rent, may be entitled to a refund. The amount refunded is dependent upon the deposit put down and how much your weekly rent costs.
Renters will only receive refunds of the excess if they remain at the property. Otherwise they would be due their entire deposit back, assuming no reductions were needed to be made for repairs.
The TDS reviewed data from when the new legislation was first introduced. From this they’ve establish how frequently partial repayments have been made. Debbie Davies from TDS said “we have made 2,550 repayments totalling £817,031.33”. “We identified the average payment was £320.27, and the highest repayment to a tenant was £3,384.62.”
If your annual rent is below £50,000, but deposit higher than 5 weeks rent, you could be owed some money. For annual rents above this, deposits need to be higher than 6 weeks rent to be entitled to repayment.
More information and guidance on the Tenant Fees Act 2019 can be found here.