Nearly £900m of tenants' deposits has been safeguarded under the Government's tenancy deposit protection scheme since it started on 6 April last year, claim new figures released this week.
Under the rules, landlords and agents have a legal duty to sign up to one of three Government-backed schemes when they take a deposit for a new assured short-hold tenancy.
Landlords not protecting a deposit taken since 6 April are committing civil offence, which could lead to them having to pay tenants three times the value of the deposit and forfeit their right to possession of their property.
There have been 458 adjudications over disputes since the scheme began.
However one Buy to Let mortgage specialist claims that a high percentage of UK landlords are still unaware of the Tenancy Deposit Scheme (TDS).
The Money Centre has found that 40 per cent of landlords they questioned are still unaware of the scheme. A further 22 per cent of respondents said they were aware but did not fully understand it, leaving only 38 per cent confirming they were aware of the scheme and understood it.
The results show that awareness levels have reached a plateau since The Money Centre last reported findings on the TDS scheme in October 2007, leaving a large proportion of landlords still in the dark about the legislation.
Lynsey Sweales, marketing and PR director of The Money Centre said: “The results of this research are extremely worrying. The scheme has now been in place for nearly a year, yet many landlords are still unaware of the legislation and its implications.
The good news is more than half of those surveyed did believe the scheme would benefit both landlords and tenants, as it was designed to do. But until awareness, understanding and participation can be improved the scheme won’t be fully effective.”
While the TDS only covers tenancy agreements made on or after 6th April 2007, as time goes on and tenancy agreements are renewed and changed, all landlords will eventually become affected. It is therefore vital that landlords take the time to understand the TDS now and avoid becoming ignorant of the law.
Sweales concluded: “Once again we are urging landlords who are not up to speed with the TDS to do their research immediately and advise them to join their local landlords’ association. These organisations provide advice to their members on changes in legislation and can act as a forum to share best practice.”
