At Holmes Estates, we are pleased to say we have assisted many South West London landlords in managing this process. A critical aspect of this stage is managing move-in money, and we are here to help you in complying with regulations and providing your new tenant with the best standard of service.
Move-in money refers to the amount of money a tenant pays at the start of the rental process. With the Tenant Fees Act coming into force in 2019, the nature of move-in money has changed for many landlords. There are more significant guidelines governing what a landlord can and cannot charge their tenant for.
Know what fees you can charge
Some fees which a landlord charged tenants at the start of the rental process are no longer applicable, so it is vital landlords know what they can charge tenants when they move into a rental property. Move-in money consists of:
· The security deposit, which is capped at five weeks’ rent, where the rental value is less than £50,000 per year, or six weeks’ rent, where the rental amount is greater
· The first months’ rent
Before the tenant has moved in, the landlord may have charged a holding deposit. This sum is capped at one weeks’ worth of rent. As the landlord has accepted the tenant’s application, this sum should be repaid to the tenant. However, many landlords offset this sum against the security deposit or the first month’s rent. Whatever you decide to do concerning returning the holding deposit, you should agree it with the tenant, and make sure there is written notification of what you do.
If you let a property on an assured shorthold tenancy basis, you must place this deposit into a Government-backed tenancy deposit scheme or TDP. For South West London landlords, you can choose from:
· Deposit Protection Service
· Tenancy Deposit Scheme
Landlords should place the deposit into a chosen scheme within 30 days of collecting the deposit. The tenant must be informed of which scheme the landlord has chosen. If the tenant complies with the tenancy agreement, doesn’t damage the rental property, and pays all bills and rent on time, they are entitled to receive the deposit back at the end of the tenancy.
At the end of the tenancy, the landlord must return the deposit within ten days of the landlord and tenant agreeing on how much the tenant will receive. If there is a dispute surrounding how much of the security deposit should be repaid, the TDP scheme protects the deposit until the issue is resolved.
As a landlord, it is vital you manage move-in money correctly, and keep the tenant fully informed. If you are a South West London landlord looking to control the moving in process, including money management better, please contact Holmes Estates, and we will be happy to help.