A new business specialising in the student lettings market will not require deposits but will instead levy a “pre-agreed damage fee”.
SPCE has launched, claiming that the student rental market is “broken”.
The business raised £280,000 in crowd-funding on Seedrs earlier this year.
Its app is described as making it easy for students to find a room or an entire house to rent, and to improve transparency between a student renter and their landlord.
The London-based start-up has partnerships with Experian and international student exchange business AIESEC.
Experian will be working with SPCE to help students develop a credit rating while at university, placing them in a stronger financial position once they graduate.
SPCE says it already has 50,000 rooms available for rent and 15,000 students pre-registered for the app, plus agreements in place with six universities.
The SPCE system includes property search; pre-validating guarantors; replacing deposits with a pre-agreed damage fee; ratings of both tenants and landlords, based on previous tenancies and available to both; and repairs reporting.
It also ends joint tenancy liability, so students do not have to pay for damage which is not their fault.
In a pre-launch survey of over 2,000 students, 61% of current university students said securing a rental property was one of the most stressful parts of the entire uni experience, with complaints about poor communication with landlords and agents.
Leon Ifayemi, CEO of SPCE, said: “Anyone currently at university or who has graduated in the past will more than likely have their fair share of horror stories about finding, securing and living in rented accommodation.
“And the truth is that many landlords will also have a tale or two to tell about renting properties to students. The launch of SPCE will change all this.
“Not only are we going to make it easy for students to find desirable properties and for landlords to locate new tenants, but we are also going to make communication between both parties throughout the tenancy absolutely effortless.”
We have asked SPCE whether its charge of a “pre-agreed damage fee” instead of a deposit will have to be ditched once the fees ban comes in.
We have also asked whether the company plans to list on Rightmove or Zoopla, and whether it belongs to a redress or ombudsman scheme.