Tenancy Deposit Scheme

3 September, 2007

For whatever reasons, a large majority of landlords have yet to register with a government-approved tenancy deposit scheme.

Whilst it is estimated that around 150,000 landlords have made the move to register with a scheme, it is clear that a large majority have yet to do so.

Three quarters of all landlords, many of whom will have but to let mortgages, are yet to register for a tenancy deposit scheme (TDS), the National Landlords Association (NLA) has advised.

The NLA has said that it believes many landlords are choosing to avoid the scheme altogether by opting for assured tenancies and other such agreements, rather than the assured short-hold tenancy (AST) agreements which qualify for the TDS.

However, such tactics are not advisable, the NLA has said, adding that it views taking a deposit as "best practice".

"Dispensing with the AST, failing to take a deposit or, even worse, taking a deposit but not protecting it – these are all actions which could leave landlords seriously out of pocket, not to mention they could be breaking the law," commented NLA chairman David Salusbury.

"For most landlords, avoiding the requirement to protect a deposit at the expense of compromising their ability to get the property back makes little business sense," Mr Salsbury added.

The scheme was first introduced by the government on April 6th, and was recently praised as a way of helping students ensure that their deposits for the new university year will not be unfairly taken from them.

Failure to comply means that a landlord forfeits the right to possession of their property and will also have to pay the tenant three times the amount of the original deposit taken.

Mr Greenberg added that the number of landlords who had signed up was disappointing 'given how successful we have been in helping to implement mandatory tenancy deposit protection

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