The company owns 1,439 homes in the former London 2012 Athletes’ Village, now known as East Village, which is home to more than 3,000 renters. It has a further 4,000 homes across the UK currently in the planning or construction phase.
It will ditch deposits from 14 June and will begin returning deposits to existing tenants from early July. Following the return of deposits, the company estimates it will release £3m back into the economy.
To qualify, residents must pass reference checks or have a guarantor. To reward residents who have taken good care of their home, if rental payments are up to date, Get Living will waive any damage and cleaning costs if it totals less than one week’s rent.
Neil Young, CEO of Get Living, said: “We launched Get Living four years ago this month and in that time our average deduction from deposits has been just a few days’ rent, with the majority of our residents getting their deposits returned in full.
“We have great relationships with our residents and, given they are taking such good care of our homes, why should we hold six weeks’ rent? We can do this at Get Living because we have the scale and track-record to know it will work.
It has already removed letting agency fees and introduced longer-term tenancies, and hopes this latest initiative will be copied by other private corporate landlords.
The announcement was welcomed by tenants’ rights campaigner Generation Rent.
Seb Klier, campaigns manager, said: “As rents have risen, up front deposits have grown. This really is a positive move for those tenants who stand to benefit.”
He added: “If we see the ban on letting fees, the next issue is the deposit. The high cost of entry into the rental system is a real problem, especially for those on a low income. It is particularly upsetting to see those trying to take life chances being held back; blocked from moving to a larger home or changing locations because of the size of the deposit.”
Klier has been in talks with several companies claiming to have an answer to the problem. Rent insurance is one option, which could be paid by the landlord or passed on to the tenant.
“This initiative would make the upfront cost of renting a property lower than paying out for a full deposit but it is unknown territory,” he said. “There is no culture of this and it may take quite a long time to convince landlords of the benefits of using a policy.”
A deposit loan scheme led by employers is another way of removing the barriers to entering the private rental market. The tenant’s employer would provide a loan to cover the deposit which would then be repaid monthly directly from the employee’s pay packet.
Chris Norris, head of policy at the National Landlords Association, said the decision to scrap deposits would depend on the landlord’s financial position.
He said: “This change from Get Living works for them, and possibly other larger-scale institutional landlords, as they have the available cashflow to offset costs when things go wrong during the tenancy, for example, if the property is damaged.
“Small individual private landlords rarely have this luxury so we’d expect deposits to continue to play a central role in the securing of properties to rent in the coming years.”
Get Living said deposits will be returned first to those residents who have lived in the same East Village home for the longest and it is expected that the returns process will be completed by the end of the year.