Half of students did not have their deposits returned when forced to leave their rented accommodation at the beginning of lockdown
78% of students in Ireland are worried about their ability to pay for accommodation ahead of the new academic year, according to new research from national housing charity Threshold which is published today in conjunction with the Union of Students in Ireland (USI).
Threshold’s Student Housing Survey 2020 found that 45% of students have been asked to pay more than one month’s rent in security deposits and 21% of those seeking accommodation for the new academic year have been asked to pay four months’ rent or more in advance.
According to the Chairperson of Threshold, Aideen Hayden: “Students were badly impacted at the outbreak of Covid-19. When universities closed and exams were cancelled, many students were forced to move out of their accommodation, with little opportunity to retrieve their belongings.
“Our new survey on the impact of Covid-19 on students shows that 49% of students did not have their rental deposits refunded when they were forced to vacate their student accommodation. The experience of students during the pandemic points to an urgent need for the introduction of a legal definition of rental deposits; to limit rental deposits to the value of one month’s rent; and to implement a Deposit Protection Scheme, which would see deposits lodged with an independent third party.
“More than a decade has passed since Threshold first advocated for the introduction of a Deposit Protection Scheme. Given that a Deposit Protection Scheme is already legislated for, we would urge the government to take action in implementing it as soon as possible. Over and above this, we believe that student-specific accommodation should be afforded special protections; particularly on-campus accommodation, tax-incentivised accommodation and developments in receipt of planning benefits. Unfortunately, colleges look to on-campus accommodation as a cash generator and specifically target it at international students, who pay hefty fees. A disconnect is evident between the role of accommodation, access to meaningful college life and access to an affordable education in the system which urgently needs to be addressed.”
USI President, Lorna Fitzpatrick said: “This is an extremely difficult time for students and their families. Many students are getting information about timetables in dribs and drabs from their institutions, which leaves them in very uncertain positions over their accommodation needs. USI recently called on the government to introduce legislation for emergency provisions to ensure student renters are not hit by a repeat of what happened in March, when colleges closed due to the Covid-19 pandemic and deposits and prepaid rent were not returned.
“The practice of looking for more than one month’s rent upfront leaves students in a very difficult situation. It should not happen any year, but this year many students have lost their jobs because of the pandemic and are in even more trying financial positions. Research in relation to Covid-19 carried out by the USI earlier this summer shows that 60 per cent of students are ‘concerned,’ ‘very concerned’ or ‘extremely concerned’ about their ability to manage financially over the next year; asking for so much money upfront is extremely unfair. A Deposit Protection Scheme was legislated for five years ago, but has yet to be implemented – this government must make this a priority.”
Western Regional Services Manager at Threshold, Karina Timothy added: “Earlier this year the average monthly rent in Galway City stood at €1,156. If a student – or indeed any tenant – is asked to pay four months’ rent in advance as a deposit, that is a staggering average of €4,624 to pay upfront and is well beyond the means of many.
“The responses from students to our housing survey also illustrate the clear need to limit rental deposits to one month’s rent. The practice of asking for more than one month’s rent upfront is almost as prevalent in the regular private rented sector as with Purpose-Built Student Accommodation and on-campus accommodation. Furthermore, a greater proportion of students have been asked to pay more than one month’s rent upfront for the forthcoming term compared to previously.”
Threshold has three key asks for government with regard to rental deposits:
Legally define a rental deposit
There is currently no definition in Irish law of a rental deposit. Threshold is calling for the government to write into law a clear definition of a rental deposit to ensure there is transparency for both landlords and tenants as to the payment and return of deposits.
Limit rental deposits to the value of one month’s rent
There are currently no legal guidelines as to how much a landlord may request as a deposit. Threshold is aware of the practice of landlords seeking deposits to the value of two or more months’ rent, along with the payment of the first month’s rent, from new tenants.
This cost is out of reach for many, meaning that they cannot compete for housing, or they enter into debt or their bills go unpaid in order to secure accommodation. Additionally, a deposit will often represent the full extent of an individual or family’s savings, and the failure of a landlord to return a deposit can create significant financial hardship and distress.
Implement Deposit Protection Scheme
A Deposit Protection Scheme would see tenants’ rental deposits lodged with an independent third party such as the Residential Tenancies Board and returned to the tenant directly by this third party. In this case it is guaranteed that the deposit will be returned to the tenant as long as they have met the terms of their tenancy agreement. This means the deposit will be safe even in exceptional circumstances such as when a landlord or letting agent goes out of business.