Deposit disputes remain rare despite rising rents – TDS

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Deposit disputes remain rare despite rising rents – TDS

Formal disputes over tenancy deposits continue to affect only a small fraction of the private rented sector, even as deposit values and rents climb, the TDS Group has revealed.

Its Statistical Briefing 2025 shows that just 1% of protected deposits in England and Wales were subject to formal adjudication during 2024/25.

A total of 46,950 cases were handled, up slightly from 0.91% the previous year but in line with a long-running pattern of disputes accounting for around one in every hundred tenancies.

Cleaning remains the most frequent trigger for disagreements, featuring in 54% of cases.

Damage followed closely at 49%, with redecoration the cause in 31%, while gardening accounted for 14% of disputes and rent arrears appeared in 10%.

99% of tenancies don’t end in dispute

Steve Harriott, the chief executive of TDS Group, said: “As rents and deposits continue to rise, the role of fair and transparent deposit protection has never been more important.

“It is encouraging that more than 99% of tenancies still end without a formal dispute, demonstrating the professionalism of agents and the cooperation of tenants across the sector.

“Where disputes do arise, our free, impartial adjudication service ensures that issues can be resolved quickly and fairly, without the need for court involvement.”

He added: “The findings also remind us that cleaning and damage remain the main sources of disagreement at the end of a tenancy, reinforcing the importance of detailed inventories and clear expectations from the outset.”

Protected deposits

The number of protected deposits in England and Wales rose to 4,706,470, while their combined value increased by about 6% to £5.53 billion.

Average deposits reached £1,175, the highest level recorded, reflecting annual rent rises of 7.9% in England and 8.8% in Wales to March 2025.

Custodial schemes now hold the majority of deposits by volume in England and Wales, representing 54.41% of all protected sums.

Insurance-backed protection still accounts for a larger share by value at 54.65%.

More disputes in Scotland

Scotland continues to record a higher dispute rate than elsewhere in the UK and during 2024/25, 5,951 disputes were raised, equivalent to 2.44% of protected deposits.

Although the total number of protected deposits slipped slightly to 243,283, their overall value increased to £215.5 million.

Cleaning was also the main issue in 58% of Scottish disputes, damage in 39% and redecoration in 25%.

Private rents north of the border rose by 5.7% over the year.

Lowest level of tenancy disputes

Northern Ireland again posted the lowest level of formal disagreement with only 358 disputes being recorded in 2024/25.

That represents 0.49% of protected deposits and marking a drop from the previous year.

The total number of protected deposits increased to 72,790, with an average value of £709.50.

Again, leaning and damage remained the most common causes.

The full Statistical Briefing 2025 is available to download for free from the TDS website.

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