INSIGHT: Here’s why tenants shouldn’t complain about paying a deposit in the UK
Research within the 15 largest rental markets around the world has found that some tenants are asked to put down 10 months’ rent or £6,145 as a deposit.
The UK is one of the most affordable places to begin a tenancy, research among the world’s 15 largest private rental housing markets has discovered.
As well as the first month’s rent, tenants in the UK must pay an average deposit of £811 or a maximum of five weeks’ rent, as the law now requires.
Only New Zealand and Turkey have lower deposits, although in Sweden there are no renting deposits at all but, instead tenants must register with a central national database which holds their rental payment track record.
But elsewhere it’s a different story. In Japan tenants must pay a deposit equivalent to ten months’ rent or £6,145 and similarly South Korean renters must also pay ten month’s rent as a deposit, or £4,360, the research by alternative deposits provider Ome reveals.
In Denmark it’s three month’s rent or £4,432 while in the US tenants pay three-and-a-half months’ rents or £3,547. And Swiss tenants are required to pay as much as three months’ rent to secure a rental property, coming in at an average cost of £3,542.
But in 24 of the 51 states in the US, there is no statutory limit on security deposits and in these states, landlords and agents can legally charge whatever they see fit.
Only a handful of countries have average deposits similar to ours including Germany, Austria, Israel, Canada, Australia and France.
Co-founder of Ome, Matthew Hooker, says: “Landlords need security to feel comfortable letting someone else live in one of their largest assets. “That’s why we’re focusing on how we can provide the landlord with the exact same financial protection as a cash deposit, whilst reducing the upfront costs to tenants when moving home to improve their day-to-day cash flow and rental wellbeing.”