The number of rent deposit disputes between landlords and tenants that are being resolved before they reach the final adjudication process has increased, according to a report by the Tenancy Deposit Scheme (TDS).
The TDS, which looks after more than a million deposits worth over £1.8 billion, says that 20% of disputes that were referred to it last year were resolved before an independent adjudicator was involved.
The government-approved scheme operates in England and Wales, with equivalent schemes running in Scotland and Northern Ireland. Rent deposits are held for the duration of the tenancy. Landlords and agents offering assured shorthold tenancies are obliged to use an approved scheme like the TDS, with the Deposit Protection Service and MyDeposits offering alternatives.
A dispute can be raised with the TDS for up to three months after the end of the tenancy. At this point, regardless of who raises the dispute, the landlord is asked to pay the disputed money to the TDS straight away. Usually the TDS will hear each party’s evidence before an independent adjudicator makes their decision within 28 days and the money held is then repaid according to the decision. Evidence can include the Tenancy agreement itself, the check-in report and/or inventory, photographs or videos showing the condition of items in the property, rent statements, estimates to show the cost of carrying out works or replacing items, quotes, invoices and receipts.
Typical disputes involve deductions for cleaning, damage, redecoration or unpaid rent. However, landlords can only deduct charges that put them in the same position as if the tenant had met their obligations, taking into account fair wear and tear.
The fact that more disputes are resolved before the need for
an adjudicator’s involvement will be good news to Landlords who are already
feeling the financial strain of a raft of measures targeted at the buy-to-let
sector. The latest, a Government proposal to scrap no-fault
evictions, has left Landlords wondering if slow and expensive court
action will be their only recourse for eviction in many cases.