The idea for flatfair came about when I was facing an all-too-common problem. As my previous tenancy was coming to an end and my next was about to begin, I found myself having to pull together a deposit for the new landlord before the previous one had been returned to me.
This unfortunate experience is the norm for most renters, and it forces tenants into a position where they have to borrow and scrape to get a new home. The deposit system is at best inconvenient, and at worst an insurmountable financial burden.
I found it unbelievable that, at a time when so many industries put top-quality service at the core of their model, that the private rental sector still lacked a more simple system.
I started to look into why the rental market was so far behind, and soon learned that the private rental sector is twice as large as it was a decade ago; meaning twice as many people are now facing the issues that come with traditional deposits.
What was needed was a service to replace the current system, which would increase trust between landlords and tenants, improve transparency across the sector, and eliminate the additional costs and stress that was impacting on both sides of the market.
With flatfair, we’ve created that service.
We made sure to keep the process simple. At its core, the aim of flatfair is to give tenants more choice. Tenants sign up to our platform with a one-off membership fee, amounting to one week’s rent (+ VAT). They then enjoy renting without the hassle of mustering a lump-sum deposit every time they want to move house.
The system is backed up through our partnership with MyDeposits, a government-trusted third-party adjudicator, who is on hand to settle the grievance quickly and fairly. This protects tenants and landlords from the stresses that have long made a deposit necessary.
The system also goes further than just covering deposits, as our members are supported right through to the end of their tenancy, which fixes another failing of the traditional deposit system. In the old system, 40 percent of tenancies end with a claim against the deposit. Tenants often feel like they don’t understand where the charges are coming from, and landlords are left uncertain that needed repair costs are going to be paid.
With flatfair however, all charges go through our portal. This makes the process totally transparent, giving all parties access to submit evidence and communicate, which has halved the number of claims made at the end of tenancies.
As we set about designing the platform, we realised that we had the system in place to offer solutions to landlords as well as tenants. We provide up to 12-weeks’ worth of protection in the event of rent arrears and/or damages, as well as free recovery services for any additional end-of-tenancy charges, totally removing the hassle of tracking down missed payments.
Landlords also benefit from being able to offer a deposit-free home, making it easier to entice tenants. This service-oriented approach is in keeping with the managed living trend that has been incredibly successful in the US, which is why build-to-rent providers Greystar and CBRE have signed on as some of our clients.
Doing away with deposits also has the added benefit of freeing up the enormous amounts of cash that is currently locked up in deposit schemes. According to recent research from campaign group Generation Rent, tenancy deposits amount to £4 billion a year, which amounts to £80 million of lost interest for the 98 percent of renters who don’t earn the appropriate interest on their deposits.
At flatfair, we set out to build a service that makes renting more convenient and accessible, and we’re delighted to have investors behind us that also believe in our mission. Now we are excited to move forward and continue with our mission, bringing the private rental sector into the modern age.