PRS landlords need more protection in uncertain times, says flatfair boss

Deposit alternative specialists flatfair have announced a bumper month with Build To Rent (BTR) sector landlords.

And CEO Gary Wright says that smaller, private landlords should follow the lead of the corporate providers in choosing the additional protection offered by their No Deposit scheme.

He said: “Understandably, landlords feel they are living in uncertain times. Local authority licensing is on the increase and the Renters Rights Bill is just around the corner.

“It’s not surprising that the bigger providers are looking at the rental landscape and seeking out as much protection as they can for their investments.”

July was a record month for No Deposit plans from flatfair’s BTR partners with 80% more plans sold than the same month last year.

Their deposit alternative option is offered at approximately 77% of live BTR units and their customers include many of the most respected names in the industry, such as Greystar, Native Residential and urbanbubble.

Wright explained that flatfair offers free protection of up to 10 weeks’ worth of damages and/or rent arrears for landlords and if the amount owed exceeds this, flatfair pays the landlords upfront while recovering the debts themselves.

Fully recovered

“With the extra protection offered with our deposit alternative, there can be a misconception that it costs landlords money. But it is completely free for both agents and landlords and they unlock double the amount of protection in the event of damage to property or rent arrears at the end of the tenancy.

“There can also be a mistaken belief that deposit alternatives attract a poorer quality of tenant but in our case, the vast majority of No Deposit tenancies have closed without charges or they have been settled in full by the tenant.

“The remainder have set up repayment plans for the money to be fully recovered on behalf of the landlord.

“A month on after the election, we can clearly see the direction of travel – that is very tenant-focused – landlords will be bound to be feeling pressure.

“The BTR sector – as a group of very large landlords – are absolutely committed to this product and see the value of it and we firmly believe that agents and smaller landlords would feel the benefit if they followed suit. They are the lifeblood of the Private Rented Sector (PRS) and they should feel that their businesses are safe and secure.”

Wright recounted the story of an agent client who also let their own property with No Deposit:

“Their tenants’ charges exceeded 10 weeks’ worth of damages and unpaid rent. In this particular case, they received 5 weeks’ worth of rent plus additional payment for redecoration, cleaning and repairs – full recovery. They said they were paid more than they would have received through a traditional deposit scheme and it saved them a lot of hassle chasing down the debt.

“The bigger BTR players have already realised this and there is no reason why private landlords should miss out.”