UK Housing Minister Welcomes Competition in Tenancy Deposit Schemes

 
 
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STANMORE, England - May 27, 2013 - PRLog -- Mark Prisk, Housing minister of the UK has welcomed increased competition in deposit protection schemes as this would help tenants to become more aware of their rights. The minister was replying to a question in the Commons from a labour MP about the steps his department had taken to make tenants aware of deposit protection schemes. Prisk hoped that increased publicity from service providers in the coming days will spread more awareness in this regard.

The new schemes in deposit protection have hiked considerable interest among the stakeholders. One of the schemes is an insurance-backed offering from the Deposit Protection Service while the other is by Capita.

The Housing Minister added: “My Department stipulates a Service Concession agreement with the tenancy deposit protection scheme Providers for carrying out publicity and marketing activities aimed at tenants as well as landlords. There has been increased publicity after the recent launch of two new schemes in April this year from both from new members as well as existing schemes in the light of heightened competition.”

Among the schemes, Capita Tenancy Deposit Protection (TDP) offers dispute resolution services through its existing ombudsman scheme, Ombudsman Services. The partnership with Ombudsman Services is its real USP.

According to Gareth Kings, Managing Director of Capita TDP, “Capita is pleased to offer landlords and letting agents a new choice of deposit protection service which will give tenants peace of mind”.

Capita’s prices start with £15 per tenancy for landlords and £9.50 for ‘regulated’ letting agents belonging to RICS, NALS, NAEA, Law Society or UKALA. For unaffiliated agents the cost is £30 per tenancy. It is claimed that the charges are highly competitive and undercut the existing rates charged by other schemes.

This may mitigate problems in the past such as an agent using an insured scheme bunk with deposit money, leaving a membership body to slug it out with the insurers of the tenancy deposit scheme on who would fork it out.

Report Sees Big Investment Coming into UK Residential Rental Market

Meanwhile, a recent research report has forecast large-scale investment in the private residential rental market of the UK as the sector is throwing up amazing opportunities.  The report by housing guru Professor Michael Ball titled, Making Sense of Large-Scale Residential Investment, has been commissioned by Get Living London, which is converting last year’s Olympics villages into private rentals called East Village.

Residential Vs Commercial

The report affirms that returns from the private rented sector are significantly higher than those from commercial property. According to the report, Residential property investment is highly lucrative as the returns are three times higher than commercial property. Also the volatility is very low in residential segment and the upward trending or market appreciation is considerably high.

In commercial property the demand is veering towards less space as technology allows the occupiers to operate more efficiently in a smaller space.  In contrast, residential property is showing the trend towards more space as incomes rise and people are ready to pay for it. Yet another flaw with commercial buildings is that they suffer from depreciation as fashion and tastes change.  In the case of residential property this does not happen as the changes can easily be adapted.

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