The new tenant deposit loan scheme, which has received wide government support, would “invigorate the lettings market”, property consultancy Carter Jonas finds.
The scheme, which works exactly like a staff season ticket loan, will allow people to choose a place to live closer to work. This will reduce their travel costs and boost their lifestyle, according to Carter Jonas.
Lisa Simon, the London-based head of the consultancy, has welcomed the news about the programme.
“Living closer to work is the ambition of many people employed in London but often the need for a high deposit was more of a deterrent than the rent itself, which could be afforded especially as it would eliminate much of the cost of commuting,”
“Instead of season ticket loans, which this new scheme effectively mirrors, employees will be able to rent the home of their choice, use their savings on travel costs to contribute to rents, and enjoy a better lifestyle through the diminished need for daily travel,” she said.
Through the scheme landlords will access a wider pool of tenants as more people would be able to afford the initial deposits on a new private rented property.
The scheme was backed by all government departments at Whitehall. It will allow public and private sector employees to take tax-free loans from their employers to make deposits for rent. The loans can then be repaid from their salary within up to a year.
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