The deposit myth: most tenants never get it back
The rental deposit is sold as protection and savings. Data on 55,118 move-outs says it's a consumed fee, paid upfront as a barrier.
The rental deposit is sold two ways at once. To tenants it is savings, their own money held safely until they leave. To landlords it is protection. Our move-out data says it is usually neither.
What the move-out data shows
Across 55,118 deposit move-outs on the books we work with, 63.2% of tenants got nothing back. A further 25.9% recovered part of the deposit. Only 10.8% were refunded in full.
The money tells the same story. Of R270.5m held in deposits, R82.1m went back to tenants. The remaining R188.4m, 69.6% of everything collected, stayed with the landlord.
Where that money goes is the part most landlords have wrong. At the end of the notice month, 68% of tenants owe nothing and most are in credit. At the end of the vacate month, 56% still owe nothing. It is only at final account that the picture inverts: 14% owe nothing, and the median tenant owes R3,247, roughly a month's rent. The deposit is not consumed by unpaid rent. It is consumed by the final account.
A deposit you mostly don't get back isn't savings. It's a deferred fee, paid upfront as a barrier.
The affordability trap
That upfront lump is the problem. Deposit, first month's rent and moving costs all fall due at once, precisely when a tenant has the least cash. What filters people out is the move-in bill, not the monthly rent. Many bridge it with short-term credit, which quietly adds interest to a "refundable" amount they'll mostly never see. Count what is actually consumed over a typical stay and the numbers are plain: the average deposit is R4,908, the average tenant never sees R3,418 of it again, and the average stay is 16.1 months. That is R213 a month, around 5% of rent, paid upfront and hidden. What the deposit costs the landlord is a separate bill.
A fee, priced like one
The waiver is the same idea made honest. A deposit already costs around 5% of rent once you count what is never returned, and the waiver costs about the same. The difference is that it is charged monthly instead of demanded upfront, and nobody calls it savings. In exchange the landlord gets cover three to five times deeper than a one-month deposit, and on a clean exit the tenant earns part of that fee back through rewards. The tenant keeps their move-in cash; the landlord gets better protection. The only thing that disappears is the fiction that the deposit was ever coming back.
Figures: refund outcomes and deposit values are computed across 55,118 deposit move-outs spanning 39,275 residential units in the lease data. Arrears at notice, vacate and final account are from LeaseSurance's deposit-behaviour analysis, against an average monthly rent of R4,290.