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Changes to the lease deposit scheme will affect owners

All landlords know how painful the lease deposit system has become. Remember the days when everything was so simple. Take a bond from the tenant and then return most of it at the end of the lease, unless the tenant has completely destroyed the place. Now, with the rental deposit scheme, landlords find it to be another administrative nightmare. Now it’s about jumping through the hoop, remembering passwords, justifying and explaining your actions to a trained referee and then possibly even to a court of law. Having to argue and show that any money you require from the deposit is reasonable for the damages or negligence your tenant has committed and that you are not blindly trying to rob the tenant. Oh, is owning no more fun?

More regulations are required. . .

Incredibly, despite the fact that the lease deposit scheme did not go into effect until April 2007, some people are already calling for the legislation to be tightened. Simon Raymond of Raymond and Co has voiced his opinion that the legislation has become ineffective and is open to abuse by unscrupulous homeowners. It has even created an electronic petition calling for a tightening of the law.

Well, he would say that he is not, he is a lawyer. Recent case law in the form of the Superior Court dispute between Universal Estates and Tiensia has held that as long as the landlord protects the deposit and provides the prescribed information “at the time of the possession hearing,” the landlord will not be liable for the deposit. fine and I can still get a warrant for possession.

My sight

Surprisingly, my opinion is that Mr. Raymond is right. In general, I do not support more legislation regarding the control of residential rent; because it rarely improves results for landlords or renters. It usually complicates life for both of you and makes the lawyers more profitable.

In this case it cannot be denied that the “law is an ass”. It proposes to fine landlords who don’t protect tenants’ deposit, but it’s been so badly worded that even tenant-friendly judges can only interpret it to mean that as long as the landlord protects you until the possession hearing, it won’t be enforced. no fine. payable.

The owners get a unfair deal.

Do not misunderstand. I have not softened. I still think that many landlords get a unfair deal if there is a dispute over the lease deposit. Most arbitrators give the hapless tenant the benefit of the doubt, who is highly regarded by the “establishment” as the underdog in the long-standing struggle for rights between tenant and landlord. Recent research shows this with only 19% of dispute cases won by landlords.

Law about to change

If the latest proposals in the localism bill become law, this poorly drafted legislation will at least eventually make sense to both landlords and tenants. The proposals being made are that a landlord would have 30 days from receipt of the deposit instead of the current 14 days to protect the deposit from the tenants and issue them the prescribed information. A much more sensitive time scale. In addition, a sliding scale of fines is proposed with a fine of between 1 and 3 times the deposit instead of the current fixed rate of 3 months. This should discourage opportunistic instances of tenants trying to fleece unsuspecting landlords, regardless of any actual harm they suffer.

The good news is that homeowners still have some breathing space even if the law gets actual consent, as the law won’t go into effect until April 2012. The bad news is that homeowners will still have a number of procedures and regulations. . and passwords to remember and still have less chance of winning if there is a dispute.

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