Tenancy Deposit Schemes Delayed
The Housing Act 2004 Tenancy Deposit Scheme will not come into force until 6th April 2007. The legislation was due to be implemented in October 2006, but has been delayed in order that further consultations can be carried out with landowners, tenants and letting agents. The provisions in the Act will make it a requirement that any landlord who wishes to take a monetary deposit must safeguard that deposit with a tenancy deposit scheme (TDS).
Arrangements will be made with bodies such as the RICS, to set up and manage Tenancy Deposit Schemes on the Government's behalf, chosen as a result of a competitive tendering process. These will be the scheme administrators. There will be two types of scheme, Custodial and Insurance based schemes.
Custodial schemes will require the deposit to be paid into the scheme, whereas insurance-based schemes will allow the landlord to retain the deposit and only transfer it into a scheme if there is a dispute with the tenant at the end of the tenancy. The scheme will then hold the deposit until the dispute is settled.
The RICS in conjunction with other firms have put in a tender, and a spokeswoman from the RICS said they hoped to find out in October whether this had been accepted or not. As a pre-emptive strike, firms can join the Tenancy Deposit Scheme for Regulated Agents, although this does not have governmental approval yet. For more information on this please look at www.tds.gb.com.
Fisher German Partner, Tony Ridgway, advises waiting for further information on the schemes available. “Fisher German will be monitoring the situation and will continue to provide updates through the Fisher German website.”
- Ashby de la Zouch
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- 01905 453275
