Deposit Protection
Wise Tip: Always conduct thorough research before making any investment.
What is the 18-Year Property Cycle (and how can you use it to your gain?)
2026-02-14
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by WiseOwl
First, I need to write that this article is not meant to act as legal advice in any way, shape or form.
We don’t think the law around the holding of deposits is particularly complicated, but we are certainly not qualified to give it advice.
The law/rules/guidance around what you can and cannot withhold from a deposit is, well, almost entirely subjective and frankly a can of worms (here is the advice the tenants are getting – link below).
So, the purpose of this blog is a discussion of the nature of deposits and highlight what you should be aware of and possibly do more research into you can do that
Wise Tip: Always conduct thorough research before making any investment.
Should I even bother to take a deposit?
Yes, you absolutely should…….. DEFINITELY!!
OK, so it almost goes without saying that a tenant can cause far more damage than will ever be recovered through the withholding of a deposit.
In many ways, the monetary value is secondary to the commitment to the property and superior financial management that the tenant is displaying in getting the deposit together.
Frequently the first question you’ll get asked by the tenant when they submit their Notice to Quit, is ‘when will I get my bond back?’.
It is quite clearly in their mind, and if that thought holds during the tenancy and they take that little bit of extra care with your property, then you are onto a winner.
The tiny bit of extra daily care that a tenant may take with your property will add up and, although I will never be able to prove this, I believe you will have fewer issues with tenants if you take a deposit. And if that is too woolly and ethereal for you – well you have the cold hard cash from the deposit to cover any repair costs.
How much should I take?
Amount taken tends to be relative to the rent the equivalent of somewhere between 1 to 2 months.
However, there are a number of reasons why you would want to take a bit more; if the tenant wants to have pets, if the tenants are foreign and a greater potential to skip payments at the end of a tenancy are but two examples.
There is no right or wrong (although as at December 2018 the Labour Party are pushing to have an upper limit on the deposit – so watch out)
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