On Monday 22 July, the national housing charity, Threshold, released details of a report into the occurrence of illegal deposit retention by landlords in Ireland.
Deposits typically consist of one month’s rent and should be returned to the tenant once their tenancy ends. There are limited circumstances in which a deposit may lawfully be retained. These include instances where the tenant is in rent arrears or behind in payment of utility bills. The most frequently cited reason for the retention of a deposit, however, is due to damage to the property above normal wear and tear.
A study carried out by the Galway branch of the housing charity estimates that over €350,000 in tenants’ deposits are retained each year in Connaught. This figure is based on the experiences of individuals who approach Threshold in relation to deposit retention and, as such, the actual figure may be much higher.
The Threshold press release detailing the research notes that the charity’s intervention “can and does help secure the return of all or part of a tenant’s deposit in many cases, but in some it will be necessary to make a complaint to the Private Residential Tenancies Board (PRTB)”.
The PRTB was established under the Residential Tenancies Act 2004 and the board exercises quasi-judicial powers to deal with tenant and landlord disputes in the place of the courts. Threshold estimates that 60% of the cases that come before the PRTB are related to deposit retention. The charity’s experience with clients has shown that many landlords retain deposits regardless of the state of the property, while others allege damage which is never proven. The introduction of a deposit protection scheme would go some way towards ensuring tenants’ money is returned to them.
Such schemes are already in place in a number of other jurisdictions, most notably the UK and New Zealand. The most likely form a deposit scheme would take in Ireland would be a custodial scheme whereby tenants’ deposits are pooled together and earn interest which in turn pays for the procedural costs of the scheme. This custodial format was the kind recommended by Indecon in an extensive assessment carried out in 2012 on the feasibility of a deposit retention scheme.
Diarmaid O’Sullivan, Services Manager for Threshold in Galway, has reiterated the immediate need for the introduction of a scheme, pointing out that “many tenants… receive deposits from their Community Welfare Officers and are expected to bring this deposit with them when they move tenancy”. When landlords illegally withhold this deposit they are putting both the tenant and the State at a disadvantage.
For further reading, see:
Indecon’s feasibility assessment http://www.environ.ie/en/Publications/DevelopmentandHousing/Housing/FileDownLoad,31535,en.pdf
Threshold’s “10 tips for getting your deposit back” http://www.threshold.ie/download/pdf/10_tips_for_getting_your_deposit_back.pdf
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All information provided on this blog is provided for information purposes only and does not constitute legal advice. Click here to read more.