I’ve Been Scarred, So I’m Jacking Up The Tenancy Deposit

Seasons greetings all!

Hope everyone had an awesome Christmas! I’m generally not a Christmas person, but mine was pretty good (better than recent years). I’m at that awkward in-between age; too old to get into a Christmas frenzy, and too youthful, sexy and beautiful to have my own children (no one say a word). To me, Christmas is all about the children. Fortunately, I don’t have any of those snot-bags, unless my parents count, so it really was all about them. They still find it hilarious when they wear the Christmas Cracker paper-crowns, so there’s no killing their giddy festive spirit. And generally speaking, if my gifts don’t match their high expectations, I’ll know about it. Brats.

With buying presents, joining in with the mandatory festive social events, squeezing in a trip to Vegas and having to completely renovate a bathroom because my previous tenants are the spawn of Satan, I spent a small fortune. I budgeted for everything, besides from the wrath of my numb-nut tenants, that left me with rent arrears, loss of rent (after they vacated), and destruction.

I hope they’re slowly burning in hell right now.

To make matters worse, the problems with my tenants happened at the wrong end of the year. By the time they vacated, the manic Christmas period was approaching. Trying to get the property they shat all over back to good order around this time of year was difficult… and slow.

God damn, the more I think/talk about it, the more I realise how much they truly screwed me over. Burning in hell for eternity just doesn’t seem like enough punishment. Not only do I want burning flames, but I want penises, lots of big ones, penetrating, splitting them open like watermelons, but slowly! Real slow.

On a more positive note, the property is ready now, so as soon as the new year kicks off, I’m going to start looking for new tenants. Great.

After my most recent debacle, I’ve admittedly been scarred; scarred like a wounded dear that’s been shot in the nuts by a hunter, consequently I’ve decided to take extra safety precautions this time round, which I wouldn’t have ordinarily taken:

Ask for a larger deposit

I’ve always asked for one month’s rent as a deposit in the past, but I’m going to jack it up to 6 weeks now. The advantages of getting a bigger deposit are mostly obvious, but here are my personal reasons for doing so:

  • Most importantly and obviously, it will cover more potential arrears and damages
  • I’d rather avoid going to court to chase money, so the more I can recoup via the deposit, the less chance there is of me bothering to pursue the Judge Judy avenue
  • This particular property is in a desirable area, so vacancies get snapped up quickly. The volume of interest is there to warrant the increase
  • I’ve looked at similar properties in the same area that are currently for let, and most of the landlords/agents are also asking for 6 weeks deposit
  • Landlords/agents asking for 6 weeks deposit really isn’t that uncommon anymore, so prospective tenants shouldn’t be alarmed by it
  • I’m going to go out on a hunch and assume that prospective tenants that are prepared to pay 6 weeks deposit will be financially stable (at least more so than those refusing to pay that amount)

For those landlords that take tenancy deposits in England and Wales (which I imagine is 99% of landlords), you should also ensure that a suitable property inventory is put in place, otherwise taking a deposit, let alone a large one, can be pointless when trying to recoup money for damages.

Tenancy Deposits must be secured in a Tenancy Deposit Scheme, so if a dispute between tenant and landlord occurs, they will ultimately decide how the money is divided and returned. In order for landlords to stand a chance of claiming money for damages, they must present their case properly, where they can prove what damage was caused during the tenancy. Here is an excellent article on how to put a property inventory together (not only because I wrote it, but because it has information from an adjudicator explaining the process).

Serve the Section 21 A.S.A.P

I recently wrote an article about serving a section 21 at the beginning of a tenancy (immediately after the deposit is secured in a tenancy deposit scheme). It received mixed reviews; some thought it was a good idea, others thought it was impractical. I just wanted to mention that I’m going to do it this time round.

I told you, I’m scarred; let me deal with my self-pity in my own irrational way!

Extra precautions

Obviously, the risk of putting any extra precautions in place will alienate some prospective tenants. The more safety precautions a landlord puts in place, the fewer prospective tenants will show interest. However, the odds are, the landlord will most likely end up with better tenants.

In any case, you still need to calculate the risk. I’m taking a calculated risk, as the property is in a desirable area where vacancies don’t crop up all that often, so I don’t think my decisions will slow down any progress. In a struggling market/location, taking extra precautions like jacking up the deposit may cost dearly. Something to take into consideration before you ruin your livelihood on the whim of following my useless dribble.

Besides from the safety precautions mentioned above, I will be following the standard protocols that all landlords should be following when finding new tenants:

  • Credit checking tenants
  • Request employment and previous tenancy references
  • Be wary of scams e.g. tenants that offer large sums of cash upfront
  • Require a Guarantor
  • Use an up-to-date written Tenancy Agreement
  • Avoid DSS tenants (ooooh, I went there. Controversial)

More details on Landlord Guide On Protection Against Bad Tenants.

Does anyone have any other sensible tips to limit risk? No? Ok, well wish me a happy new year and be on your merry way.

Happy New year everyone; have a sleazy one, that involves alcohol, mindless fun, and no protection! x

18 Comments - join the conversation...

Default Avatar
Benji2012-12-30 14:37:52

Rent Guarantee Insurance?
Happy new year.

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Default Avatar
Benji2012-12-30 17:42:58

p.s

Your ex-tenants send a big 'phuk-you' for providing their very merry Christmas at your expense.
The presents were wonderful, the turkey delicious and the case of champagne will keep them going well into the New Year.

As you aren't bothering to chase them for the arrears, costs, etc they assume it is all OK to do it again and intend to shaft a landlord every Christmas for the forseeable future.

It is unfortunate that future tenants will also have to pay the price of higher rents, deposit etc but who gives...?

If you ever feel like giving away another grand and clearing up other peoples grease and shit then just give me a call.

Merry Easter!

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The Landlord Avatar
The Landlord2012-12-31 10:04:29

Couldn't just wish me a happy new year, could you?

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Matthew2012-12-31 10:15:52

I am writing in reply to the leading story about shoddy tenants, it is pointless using other adjectives. The solution to your problem is to use, at a percentage of the rental income, a decent letting agent. I say decent, as I have been stung by many unscrupulous agents, here in Newark, being foolish and leaving Martin and Co. to go to a slightly cheaper agent. That was when my troubles started! They managed to do inferior repairs, kept properties empty, and in one case, Belvoir in Newark, told me a property was empty, but had a tenant and were keeping the rent! I could not check, as I am disabled. So I have now returned to Martin and Co. in Newark, who are efficient and honest

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The Landlord Avatar
The Landlord2012-12-31 10:56:47

I personally don't think using a letting agent would solve the underlying issue. Even good letting agents provide tenants that fall into arrears...

A lot of tenants start off as good tenants, then something usually happens e.g. unemployment. There's no real defense for that.

There was no reason why my tenants wouldn't have been given tenancy by a good letting agent. My tenants fell into arrears after a year. If I had used a letting agent, I would have been paying their fees, even while I wasn't receiving rent...

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Default Avatar
Matthew2012-12-31 11:48:36

My present letting agents 'vet' all prospective tenants and I has insurance for, non payment, repairs and whatever else. A good agent, such as mine will make sure that the tenant is always kept happy, all repairs are done as quickly as possible, and will help a tenant by all means possible, if the poor unfortunate becomes unemployed, and therefore needs to rely on the meagre allowance for living, including rent, from the state. Before I get ranted at, I know that it was wrong of the DSS to pay the rent to the tenant, and not to the landlord as I have lost out and had to rely on insurance for the rent, and insurance companies take forever, but bad tenants are usually dissuaded by a decent Letting Agent. A good letting agent is a priority and my agents don't receive payment by me, they deduct it from the rent, therefore I don't have to pay, on the very rare occasions they don't get paid. I am quite certain that if I had not returned to Martin and Co. the other agents would have made me go under! Philip, at Newark is fantastic.

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Katie2013-01-02 12:55:57

With most agents you wont pay their fees unless you are getting rent. We only take a percentage of what we collect in so it is in our interests as much as the Landlords' not to get tenants that default!

I will agree that using an agent wont stop it occurring - the only way you could be sure was rent guarantee insurance.

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The Landlord Avatar
The Landlord2013-01-02 16:28:31

Hi Katie,

Out of curiosity, while you're not accepting payment, do you still send any relevant notices on behalf of the landlord (e.g. Section 8, section 21)?

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Default Avatar
Katie2013-01-02 16:35:28

Yes and file for Possession if needed, all at no extra cost to the Landlord :-)

I cant imagine that any agent that charges for such a thing is going to encourage repeat business whereas on the odd occasion we have had such a tenancy the Landlord has been happy to leave the property in our care for subsequent tenancies, based on the understanding that it was beyond our control and that we did everything in our power to resolve the situation as quickly as possible and at no further charge (very important when income is zero!)

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Armin2013-01-03 09:26:52

I'd generally advise against using real estate agents unless you're abroad/have special needs, especially if they advertise via spamming a blog comment section.

This is where your money mostly goes to. Their marketing. Not looking after your property.

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Katie2013-01-03 12:36:46

How is that an advert?? I havent named my agency or even said what area I am located in. I am simply demonstrating that some of us agents offer good value for money! Im currently off work following surgery, so have plenty of time to interact with Landlords - something I happen to find interesting!! You have a strange notion of 'marketing' ;-)

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The Landlord Avatar
The Landlord2013-01-03 14:38:51

Katie, I think he was talking to/about Matthew :)

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Default Avatar
Katie2013-01-04 11:05:00

Ohhhhh.... You see I am so gullible I just assumed he was a genuine Landlord with a rare positive Agent review ;-)

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Matthew2013-01-04 18:33:21

I am a genuine landlord, and am merely pointing out my experiences. I am merely passing on the shambolic nature of certain bad agents and also pointing out that there are good ones out there, but if you don't want to benefit from my bad experiences with crooked agents, it is your own fault. I am merely trying to help!
Matthew

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Katie2013-01-04 19:14:11

Good to hear Matthew :) Shame on Armin for being so cynical ;-)

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Armin2013-01-11 12:05:19

I'm a programmer in the e-marketing industry. I'm very familiar with the underhanded methods employed nowadays by promoters to fake positive reviews/forum contributions in order to drive traffic / generate leads.

If long established contributors in a forum highlight companies in positive comments/reviews by name, then that deserves some trust/taking on faith.

But the moment you see lots of gushing admiration for a named company/person in any setting where there's no real contribution history by the person writing the post, you need to be very cautious about trusting that information.

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Default Avatar
Matthew2013-12-29 14:50:39

I am a retired, disabled detective, virtually immobile, which is why other agents have been able to 'take me to the cleaners' which is why I am so grateful to Philip. You will note that I haven't named the two really bad agents in Newark, but feel that Philips honesty should be rewarded!

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hayley2014-02-05 14:49:55

Tendrind dc are going for the maverick approach to council tax once the property is vacant u r liable. Interestingly they are now quoting high court precedent. This was based on a commercial let which had turned periodic where tenants handed back the keys they state any tenancy agreement r bound to same decision. This basically states that when tenant gives notice to quit from that point ur liable to council tax. Can't c how this works I can't b only landlord that has tenants giving notice and moving onto the but still liable for rent bills etc whilst still in contract for those of you interested look up macattram v London Borough of Camden I would be grateful to any suggestions for fighting council

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