Zero Deposit boss calls for Code as CMA slams sector
Sam Reynolds says that the CMA’s latest progress report on private rented housing should be welcomed by those within the sector.
Zero Deposit boss Sam Reynolds has called for a Code of Conduct to be created for alternative deposits schemes after the Competition and Markets Authority (CMA) found a ‘significant minority’ of letting agents and landlords were found to be flaunting consumer protection rules.
The latest progress report on consumer protection works within the private rented housing and housebuilding market published by the CMA highlighted five areas of focus to be probed further – including zero deposit schemes, sham licenses, guarantees, unlawful discrimination and retirement housing fees.
DEPOSIT ALTERNATIVES
With deposit alternative schemes, tenants normally pay the equivalent of one week’s rent (upfront or over 12 months) plus a small setup fee for a no-deposit guarantee,
Sam Reynolds (main picture), Chief Executive of Zero Deposit, says: “I wholeheartedly welcome the move by the CMA to improve standards in order to tackle unfair practices in the markets, particularly within the deposit replacement category.
“Despite growing proof of the impact of these poor practices, very little has changed and in some areas, such as protecting vulnerable tenants at the end of tenancy, it’s getting significantly worse.”
Reynolds has been calling for improvements to standards within the deposit replacement market and has lobbied for the creation of a Code of Conduct.
MATTER OF URGENCY
He adds: “This must now be introduced as a matter of urgency to protect unsuspecting tenants from being exposed to bad practice.
“I believe the poor practices outlined in the initial [CMA] review are entirely driven by commercial benefit, not what’s in the best interest of the tenant and such practices would face regulatory scrutiny.
We see the positive impact of deposit alternatives on a daily basis.”
“We see the positive impact of deposit alternatives on a daily basis. When given the opportunity, 70% of tenants choose Zero Deposit over a cash deposit and are able to move for a small upfront fee.
“They benefit from safeguards including a 14 day cooling off period, a clear and transparent sales journey that allows them to make a fully informed choice without pressure and interest free payment plans on any liability.”
