CPS Homes

Our "no deposit" case studies show end of tenancy costs are typically low

Estimated reading time: 2 minutes.

Jordan, Senior Property Aadvisor at CPS Homes in Cardiff, South WalesWe’ve had a few landlords ask us how much offering a no or low deposit tenancy is likely to cost them in the long run. Whilst we can never guarantee the condition of a property at the end of a tenancy (though we do issue a lot of vacating instructions!), we generally find that landlords benefit from using this option, both financially and in the early securing of tenants. Similarly, tenants benefit from paying less upfront.

We’ve already had a number of ‘no deposit’ tenancies come to an end. What we’ve generally found is that the end of tenancy costs – normally claimed from tenants’ deposits – are actually relatively low.

A few examples:

Flora Street, 4-bed HMO, £1300PCM
At the end of the tenancy, only a clean was required, costing £92.
The landlord earned an extra £650 in August due to full-rent, so profited by £558.

Pentyrch Street, 3-bed HMO, £1080PCM
At the end of the tenancy, some maintenance and cleaning was required, costing £364.
The landlord earned an extra £540 in August due to full-rent, so profited by £176.

Llanbleddian Gardens, 9-bed HMO, £3240PCM
At the end of the tenancy, some maintenance and cleaning was required, costing £125.
The landlord earned an extra £1620 in August due to full-rent, so profited by £1495.

The above is only a small sample size, but it shows landlords profiting from the additional rent in August, which we’ve always said should be regarded as a substitute for the deposit and set aside in case work is needed at the end of the tenancy.

It’s worth remembering that, even when there is a deposit, the claims made are typically only an apportioned amount of the repair or replacement cost. We have to avoid ‘betterment’ (the replacement of old for new) and have to consider the condition and lifespan or fixtures, fittings and décor when assessing claims for damages.

Claims also need to be evidenced and won’t always succeed if disputed, with adjudicators known to award only a percentage of the overall claim amount. HMO tenancies especially are considered to have a higher threshold when it comes to wear and tear, making adjudication even trickier. In contrast, the additional rent has been guaranteed extra income for landlords.

05 May 2022

Back

Posts by date

Sign up for updates

By using this form, you agree with the storage and handling of your data in accordance with GDPR for the sole purpose of communication. We respect your privacy and will not share your data with third parties. For more information, please view our Privacy Policy.

cwtch tile