Average deposit nears £1,300 says new alternative scheme

The average deposit paid by a new private tenant is now £1,299 according to a new player in the deposit alternative field.

Research by Hamilton Fraser’s new deposit alternative scheme Ome shows that this average is actually three per cent lower than last year’s figure of £1,336.

Ome also says that the number of new tenant deposits being taken and the total value have both seen a consistent drop each year since 2015. 

So far in 2019, based on figures up to the end of November, the number of new deposits being taken has declined by 17 per cent when compared to last year, while the total value of these deposits is also down 19 per cent from some £611m to £496m. 

Looking over the last five years, the number of new deposits being taken has declined by 22 per cent, while the total value is down 17 per cent. 

Matthew Hooker, a co-founder of Ome, says: “We’ve seen a decline in the number and value of new deposits being taken over the last few years and a driving factor behind this is a change in our lifestyle choices to rent for longer, which reduces the number of deposits being taken and the total value as tenants opt to stay put in the same property.

“Although the average cost for the individual tenant has continued to climb due to increasing rents which form the basis of the deposit calculation, this year looks to be the first in a long time that we might actually see this cost drop.

“This has largely been driven by new legislation that has reduced the number of weeks rent an agent or landlord can charge for both a holding and tenancy deposit.”