Tenant changed mind about moving in - can I keep their deposit?

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    Tenant changed mind about moving in - can I keep their deposit?

    Hi everyone, I signed up to ask for advice on a conflict with a tenant:

    A new tenant agreed to move into my property and at that time I agreed (via email) to perform some repairs/maintenance and clean the flat prior to them moving in. We agreed a moving in date and they paid their deposit. The tenant also agreed to pay the first month's rent before moving in.

    As moving in day approached the tenant emailed to say they were not happy with the quality and completeness of my repairs/maintenance and that the flat was dirty. They had not paid the first months rent which I then requested. They refused to pay until I sorted out the problems. At this point communications broke down until (a week after moving in date had passed) the tenant emailed to say they no longer wanted the property. They asked for the desposit back and requested I let them know what to do with the keys (which I had given them in advance of the moving in date as the flat was empty).

    To avoid hassle I agreed to this and requested they drop the keys back at the flat. 20 days later the tenants notify me that they have not received the deposit back - I tell them I have not paid it because the keys have not been returned. They then say they have not returned the keys because they have not had their deposit! So we are at deadlock.. Am I right to keep their deposit? If they do not return the keys in a reasonable time am I right to change the locks and use their deposit for that purpose?

    How would this stand in a small claims court?

    Apologies for the lengthy first post,


    Is there any evidence that prosp T entered property on/after designated move-in date? If No & since no rent was paid, no T exists but there is a Contract to supply/accept. You may be able to sue for this breach of Contract and claim nominal rent until keys returned + cost of re-marketing from deposit. I cannot predict any Judge's mindset.
    Golden rule - no signed AST, no keys


      Hi, thanks for the reply.

      No the tenant has NOT been to flat on or after the move in date. There was no written/signed contract, only a verbal agreement - will this matter?


        Personally if you are certain that a tenancy has not started then I would simply change the locks. That would put you in a much better position depending what they signed to keep reasonable costs you have had by not having tenants. Or change them then return all deposit and move on.


          What is to stop you meeting at the property and exchanging keys/cheque?


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