Thursday, January 25, 2007

An interview on the Tenancy Deposit Scheme

I did my first recorded interview yesterday. It was an interview of Lawrence Greenberg who runs the Dispute Service Ltd, one of the three companies contracted to run the new Tenancy Deposit Scheme ("TDS"), scheduled to start from April 2007.

I am afraid you can't listen to it unless you are an annual member of Landlord-Law as it is a 'members only' content. However I think Landlords will find it very interesting. Here are a few points which arose from my talk with Lawrence and his colleagues during my time with them.

Landlords must have a detailed inventory. It is clear that in a dispute where there is no inventory, landlords run the risk of losing their case simply because of the lack of inventory. They need to be very, very detailed.

Photos are a waste of time unless they are very clear and focused and contain a ruler or something similar to show the scale. I have to say that photographs clients have sent to me in the past when I have been advising about their tenants liability for damage, have generally been pretty useless.

Tenants need to protect their position and make sure that any damage to the property or its furniture is marked on the inventory at the check in meeting, otherwise there will be no way to prove that the damage was not done by them, and they will be at risk of having to pay for it out of their damage deposit.

I did not discuss any actual fee charges with Lawrence, but I suspect that the cost of the insurance scheme may be more than people think, especially at first. Not so much perhaps for agents who are members of one of the national associations (particularly those who are already clients of the Dispute Service’s existing TDS scheme), but for private landlords who may be an 'unknown quantity' and therefore a higher risk.

Of course landlords who do not want to pay for TDS can use the custodial scheme (this is not the scheme run by Lawrence’s company but one of the two others). However if so they will have to hand the deposit over to the scheme. One of the people I spoke to (not Lawrence) expressed doubts as to whether the company running this scheme, Computershare Investor Services PLC, would be able to make a profit, as the government is not making any contribution to their running costs, their only income will be the interest on the deposits held, and part of this will have to be paid out to the tenant.

Anyway it was great fun doing the interview, just like a real radio journalist! I had a chat with a BBC man a few months ago who gave me a few tips, one of which being to look the interviewee in the eyes during the interview so you can judge when to speak. I did find that a great help.

I shall have to do some more …

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