Landlords retaining deposits can lead to homelessness, warns charity

The retention of deposits by landlords can lead to homelessness for former tenants, a representative for housing charity Threshold has said.

“A deposit is usually a month’s rent, and we have seen people in the past become homeless if they don’t get it back,” Threshold’s southern regional manager Edel Conlon told The Echo.

“If they don’t have savings, the money is necessary to pay for the deposit on the next place they rent, meaning that without it, they may not be able to secure anywhere to live.”

Threshold has been calling for the introduction of a Deposit Protection Scheme which would enable tenants to lodge their deposit with an independent third party, such as the Rental Tenancies Board, thus ensuring the prompt return of a deposit at the end of a tenancy and that the process was done fairly.

“Often people would have been banking on that money, they wouldn’t otherwise have any other funds, so it’s vital, to prevent homelessness, for that scheme to be introduced,” Ms Conlon explained.

Cork figures 

The retention of deposits by landlords is one of the top four issues affecting Threshold clients and, so far this year, Threshold has assisted 71 households in Cork city and county with this issue. 

This represents almost 18 a month, an increase from 16 people a month in 2023, when Threshold assisted 192 households in Cork whose deposit had been retained by the landlord.

Ms Conlon said that the main reasons landlords may be withholding deposits are for disputes over a bill, rent arrears, or property damage.

If there is a dispute over rent paid “we would want to look at if there was a rent increase at any stage, then delve into if it was a valid increase,” she said.

“Sometimes the landlord will be claiming damage above normal wear and tear, and we would look at photographic evidence — we advise photographing the entire property when moving in so people have evidence should a dispute arise.

“If the tenant wants their money returned and the landlord is refusing, we would lodge a dispute with the RTB at that point.”

Of the deposit-retention cases that were reported last year in Cork, 110 were resolved, meaning there was either a full or partial refund; just 10 were unresolved, meaning that there was no refund, so there were 10 times more cases when the tenant was due at least part of their deposit back after being told they were not.

Threshold has also dealt with cases where the landlord “ghosts” the tenant when they are asking for their deposit back and they cannot get a response from them.

She said this could be for a number of reasons, including that they may be in financial difficulty themselves.

“Sometimes, the deposit is viewed as an extra bit of rent, but that’s not the case,” said Ms Conlon.

“The legislation is very clear about the purpose of the deposit, and the Deposit Protection Scheme would sort all of this out.”

Ms Conlon urged people to get in contact with Threshold if they were struggling with deposit issues, or if they get a notice to vacate their property.