JUNGLEdrum News

Letting agent abolishes tenancy deposits

North East letting agent KIS, claims to be the first in the UK to abolish tenancy deposits, replacing them with a landlord insurance policy.

The company last week signed an exclusive deal with an insurance broker and insurance provider to launch Let By Cover, which removes the need for a guarantor and offers tenants and landlords a guaranteed rent, help with legal fees, potentially cheaper than average move-in fees, and round-the-clock emergency home repairs, administered by a third party.

The move is designed to bring an end to negative issues surrounding tenancy deposits, and the Founder and Managing Director of KIS, Ajay Jagota (above), is now urging the authorities to close a loophole which could allow rogue landlords and crooked letting agents make off with their tenant’s deposits.

“The only way to end deposit abuse is to end deposits”, Jagota said.

“The KIS renting revolution is evolving – making it simpler and safer to rent or rent out a home,” he added.

Tenancy deposit protection has existed in England and Wales since April 2007 when it was introduced as part of the Housing Act 2004, and was eventually launched in Scotland in 2012 and implemented in Northern Ireland last year.

The law requires all deposits taken on an Assured Shorthold Tenancy agreement to be protected in any one of the Government-authorised insurance based or custodial deposit protection schemes.

But Jagota insists that the idea of taking tenancy deposits is an outdated one which will be phased out over the next few years.

He continued,“As an industry and a society we’ve got it into our heads that deposits are just something you do, but future generations will look back on them with the same sense of embarrassment and amusement that we have for the clothes we wore 20 years ago.”

He pointed out that a typical tenancy deposit of around £500 in the North East will barely cover a landlord in the event of serious damage to their property or serious rent arrears.

He also claimed that while helping landlords, the Let By Cover scheme will also assist many tenants who are financially stretched and may otherwise struggle to secure a rental property of their choice because they cannot raise the money required for the tenancy deposit. What’s more, in less than a week since Let by Cover’s launch, KIS claims to have seen a threefold increase in the number of properties it manages being rented out.

“Let By Cover makes it easier to find and keep homes and easier to find and keep tenants, with peace of mind and security for everyone – and less than a week after launching we’ve seen a 300 per cent increase in properties we manage being rented out, so it’s clear that both renters and landlords agree.”

Jagota said that his firm plans to roll out the Let By Cover insurance scheme, eventually making it available to other letting agents nationwide.

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