23 February, 2007

With just 42 days to go until the introduction of the statutory Tenancy Deposit Scheme in England and Wales, a survey by the Government-supported National Approved Letting Scheme (NALS) has indicated that 18 per cent of agents are undecided as to whether to offer an insurance-based or custodial scheme.

Of the letting agents that currently hold deposits, 77 per cent of agents are planning to adopt an insurance-based scheme under the new legislation, leaving just 5 per cent looking at taking the custodial route.

‘Adoption of a scheme is not negotiable and applies to everyone – from the national estate agency chains down to the individual buy-to-let property investor, explains Caroline Pickering, NALS Chair. 

‘After the 6 April deadline, any monies taken by an agent or landlord will have to be held in an approved scheme – it doesn’t leave that long for just under a fifth of the UK’s agents to decide what they are going to do.’

The survey also revealed that just 15 per cent of agents had noted an increase in enquiries from landlords and just 5 per cent from tenants in relation to tenancy deposit schemes.

‘We know that the Government will be launching its own awareness campaign but it would appear that many smaller landlords aren’t aware of the impact upon their business,’ continued Pickering.

‘We would encourage agents to flag up the forthcoming new law and explain what it means.  In addition, it’s a good opportunity to demonstrate best practice with tenants – they will feel better protected and the reputation of your business will benefit.’