The new managing director of Martin & Co has hit out at ‘zero’ tenancy deposit schemes.
Louise Griffiths said she read with disbelief that the Government had taken notice of a select committee’s recommendations “and will encourage further innovation in the deposit free renting sector”.
Griffiths told EYE: “The deposit is not money that an agent keeps. Rather it offers an element of protection to the landlord and a commitment from the tenant.
“Further innovation won’t save tenants’ money – it will cost them.
“Every tenancy will bear a charge, rather than the current system where (in the majority of cases) no dilapidation charge is levied and the tenant recovers their monies in full.
“As managing director of a nationwide agency I educate my business owners on the various zero deposit schemes in the market as no one can afford to lose instructions because another agent can potentially bring more tenants to the table by advertising that they don’t need to pay a deposit.
“Landlords need to have done their due diligence when accepting a tenant with no deposit as some of the schemes only work if the tenant continues to pay a monthly fee in addition to the rent.
“For a tenant who looks after a property well and would receive back their full deposit, these schemes will end up costing them more, a lot more, now that tenancies are lasting longer, literally years longer than was typical a decade ago.
“Surely this goes against what the tenant fee ban legislation is designed to mitigate?”
She went on: “For those tenants who leave properties with significant damages and dilapidations and have no intention of paying, this will result in debt collection agencies all over the country chasing tenants for unpaid charges.
“This will bring the lettings industry into further disrepute in an arena where our reputation is already unjustifiably tarnished.
“Whilst there may be merits in some of the schemes on offer in some local market conditions, a ‘Government approved’ blanket alternative to the traditional deposit is not the right way forward for anyone.”
Griffiths took up her position at Martin & Co in March. She was previously a director at Romans, and before that a director at Hamptons, which she joined from Savills.