Lettings agency Haart says it will return up to £20m in deposits to existing tenants if they sign up to a deposit alternative service run by the company Flatfair.
Haart partnered with Flatfair last April to provide new tenants with the option of paying a one-off ‘membership fee’ equivalent to one week’s rent plus VAT.
The Flatfair scheme gives landlords up to 12 weeks’ protection against rent arrears and dilapidations.
Now Haart is extending the scheme in what it describes as the UK’s biggest-ever ‘deposit return’ campaign.
Existing tenants would receive their deposit money back in full within 30 days of their Flatfair membership going live.
“It’s more important to us than ever that we offer landlords the highest level of protection on the market and that’s exactly what Flatfair provides, while benefiting tenants at the same time. It’s a win-win” says Spicerhaart chief executive, Paul Smith.
The average tenancy deposit comes in at £1,407 across the UK as a whole or £1,536 in London.
“We hope to put millions of pounds that are pointlessly locked away back in the pockets of tenants across the UK, while providing landlords with the cover they need” says Flatfair chief executive, Franz Doerr.
Flatfair says that under its scheme landlords can charge tenants directly for any lawful claims at the end of their tenancy, while benefiting from protection which is the equivalent of 12 weeks’ worth of rent.
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Soon tenants will get free rent and be able to wreck a House and then get all their money back and maybe extra on top too!
Emma, What is written in this article that leads you to believe that this will lead to tenants being able to live rent free in a property? It seems to me that maybe you need to improve your vetting if all your tenants wreck your house(s). On the surface this type of approach sounds as though it would benefit both landlords and tenants - that is until you look at the charges this agency imposes on both landlords and tenants.
I think what she meant Is that this benefits rogue tenant who persistently change accomodation in order to avoid paying rent arrears and insurance will pay on their behalf for 1 weeks rent. These type of tenants often leave a trail of damages and I am sure we all came across such tenants at some point. This does not instil honesty or encourage tenants to behave well n pay rent or look after property. It only increase the number of rogue tenants whether students or working tenants
A windfall is a large amount of money won or given money unexpectedly. The tenants are getting back THEIR money!! but less of it as they will have to pay (no refund) for the product. That's not a windfall - Media headlines..... No deposit actually costs the tenants money...A deposit is given back in full as long as no damage is done. The difficulty with insurance backed schemes is the decision over what is deemed to be recoverable. Damage done by a tenant for example - painting a room in a very personalised colour - may need to be brought back to colour at the start of the tenancy - straightforward from tenant/LL/agent - clear on the agreement. An insurance company may chose to say that redecoration is not recoverable under their scheme. The devil is in the detail and with no accountability - does the "claim" record go with the tenant? it could lead in some cases to LL problems. There may be a place for insurance backed deposits but it's not necessarily a product that will suit everyone.
Trust not Tricks, and there are a few with this "scheme".
Charge the tenants for any damage when as a landlord you don't hold the purse strings?, never work, the tenant will say bye bye, take me to court!
Wow this Is commercial suicide for a quick gain of a small fee from Flatfair, how many landlords have agreed to this it’s not the agents decision it’s the landlords, there are to many issues to even list here that could occurs. Good luck Haart
should I bend over now or later?????????????????
we all know how difficult it is to get tenants to agre even the most basic of dilapidations, are we looking at the next PPI with these ins backed schemes?
One thing is for sure, the shear amount of new domestic property legislation is proving to be giving opportunity to a whole new range of scams and fee charging. The councils are becoming big players in this. Complex legislation/rule making always does this. Anyone remember the Wilson government when they tried to minutely control business expenses and cash leaving the UK. What a "game" that was and it did not work!
Privat property law is heading the same way and it will not work.
I understand that the tenants pay one weeks rent for 12 months cover. What happens in the second year if the tenants don't pay the fee again ? You are left with either issuing the tenants notice or having no deposit !
notice is assuming that the government do not ban Section 21 notices
Interesting. Will the fee fall foul of the new law prohibiting fees?
On the same note will any insurance paid by tenants to schemes like repository also be banned?
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