Specialist insurance firm Hamilton Fraser has launched its latest brand, Ome, which aims to offer choice around tenancy deposits, via its Deposit Replacement Membership.
This is a monthly subscription-style service, allowing tenants to rent a home without paying a deposit, while also protecting the landlord’s financial security.
Based on data from Ome’s sister company, mydeposits, the average deposit paid by tenants over the last year has been £1,299. This equates to 55% of the average net monthly wage, which currently sits at £2,059.
For those receiving just 80% of their pay, as under the current government job retention scheme during the coronavirus pandemic, this percentage rises to 69%.
With Ome, 86% of tenants will be able to pay less than £9 per month, in addition to a one-off set-up cost of £30.
Tenants will continue to be responsible for damages to the property, as well as rent and bills; if issues arise, they can deal directly with their landlord via and app, with support from the resolution team at Hamilton Fraser.
Landlords will benefit from reduced deposit protection fees and lower risk of deposit-related fines.
Ome will also allow be launching systems that allow larger agencies, digital-first platforms and property management software providers to automate the journey for landlords and tenants.
Matthew Hooker, co-founder of Ome, Matthew Hooker, said: “We’re really excited to launch what we believe is a brand and product that will set and define the new standards expected from a deposit replacement scheme.
“We anticipate Ome becoming a platform for a multitude of deposit and tenancy management solutions so we cannot wait to enhance our already competitive offering.
“We’ve learned a lot over the years from operating authorised schemes such as mydeposits and The Property Redress Scheme and we’ve worked hard to ensure we maintain the standards we and others expect of us.
“With the future of traditional deposits in discussion and the finer details of the ‘Lifetime Deposit’ yet to be announced it’s important that we gear up for a future where flexibility and choice are the number one priority.
“There has already been a growing demand for deposit replacement products, so the time is now right to bring deposit replacements into the mainstream rental experience.
“The latest generation of tenants, in particular, have become accustomed to consuming products and services on a monthly basis and paying a small manageable fee rather than buying them outright at a considerable cost.
“Of course, this route isn’t for everyone and it’s vital that tenants are always made aware of what they are opting for and that they also always have a choice.
“However, for many, the option to pay a small monthly fee may be more preferable, especially considering the current climate, to provide support and financial stability for their family and their home.”