Increasing the deposit

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    Increasing the deposit

    Scenario: tenant pays a rent deposit based on 6 weeks rent. On expiry of the tenancy, the tenant renews at a higher rent,

    Q: is it usual for the amount of rent deposit to be topped-up to take account of the higher rent, or remain as originally.


    Remains as is.
    When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
    Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).


      Basically no the deposit is not increased. If another tenancy were to be taken out then original deposit would have to be refunded and another taken. On refunding the deposit then another inventory may be needed to establish the condition of the property - all this is more cost and time.

      Surely if your tenant is getting along well then just increase the rent in line with what is says in your agreement. I, personallt would let the tenancy go periodic. You wouldn't be letting them stay on if the property was not being care for properly - would you?

      Freedom at the point of zero............


        Thank you.

        I don't have much experience of day-to-day residential property management. With commercial property, normally there is provision in a rent deposit deed for the amount of deposit to be topped up when the rent is increased.


          Originally posted by rentreviewspecialist View Post
          With commercial property, normally there is provision in a rent deposit deed for the amount of deposit to be topped up when the rent is increased.
          I have such a provision in my agreements, but have never enforced it.
          If a tenant stays long enough for a rent increase (not usually within 3 years), then I am happy that they are reasonable people and I am unlikely to need increased security. And by then I have not 'lost' money through voids and finding new tenants.


            You do not need to protect the deposit again if:
            • The tenancy continues on a periodic basis on exactly the same terms.

            You do need to protect the deposit again if:
            • You enter into a new fixed term tenancy agreement
            • The tenancy continues on a periodic basis with material changes to the agreement, such as rent or tenants.


              There is actually less point in having a deposit at all, the longer the tenancy continues.

              Think about it: After 5 years, you won't be able to claim anything anyway, as the value of most items will be assessed as zero by the adjudicator.


                Check your scheme, as I just read the TDS and DPS they both have different views, the DPS is much better in my opinion for this particular issue, if you renew, you don't need to re-register your deposit. The TDS on the other hand say's you need to re-register on renewals. Check which scheme you hold the deposit with.


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