Do serviced apartments need deposits?

Do serviced apartments need deposits?

There is no single rule on whether serviced apartments need deposits. Wikipedia describes the aparthotel as similar to renting an apartment but without fixed contracts, which means there is no standard tenancy deposit attached to a stay. Instead, each operator writes its own terms, and those terms differ more than most guests expect.

In the terms of the operators checked for this guide, three patterns appear. One takes a card pre-authorisation on arrival. One takes a refundable security deposit before arrival, to be returned after the apartment has been checked. One says guests need no deposit unless advised at booking. A fourth asks for a deposit on arrival against incidental charges, plus a separate booking deposit for some longer reservations. Treat these as examples of how the market works, not as a statement of what any other operator does.

Security deposit or card pre-authorisation: what is the difference?

A pre-authorisation, also called a card hold, reserves an amount on your card without taking it. Lodgify's glossary defines it as a temporary hold placed on a guest's payment card, and says a charge is the actual transfer of money, which only happens if the host captures the held amount to cover costs. The money stays in your account but you cannot spend it while the hold lasts.

A security deposit works differently. The operator takes the money, usually by card, and returns it after departure once the apartment has been checked. One UK serviced apartment operator's terms say the deposit is refunded after departure once the apartment has been checked and everything has been found in order. A deposit like this is a payment you wait to get back, rather than a hold that simply lapses.

Debit and credit cards behave differently. An Elliott Advocacy article on card holds explains that on some cards, notably debit cards, an authorisation can look like a charge, and the held amount can be unavailable to the cardholder. For a long stay, check that the card you plan to use has enough headroom for the hold on top of your normal spending.

How operators describe deposits in their own terms

Reading real terms is the quickest way to see the range. Quest, an Australian brand, says on its FAQ page that it asks for a card or a cash deposit equal to the first night to confirm a booking, and takes a pre-authorisation on arrival. It adds that the amount can vary at the property's discretion and during peak periods. See the operator's page at Quest for its properties.

Locke takes a different line. Its help centre says guests do not need to pay a deposit unless specifically advised at booking, for example for a group booking. For pay-on-arrival rates it places a pre-authorisation fee to confirm the card is valid, holds it until checkout, and says it may charge the card for damage and will tell the guest if so. See Locke for the brand.

A third operator, The Spires Serviced Apartments in the UK, states in its terms that a refundable security deposit per apartment is required for all stays, paid online at least 24 hours before arrival, with a higher refundable deposit on two festive nights. Mansley, another UK operator, requires a deposit on arrival for incidental charges and reserves the right to use it for damage or deep cleaning, as well as asking for a reservation deposit on some longer flexible bookings.

Booking deposit, security deposit and payment: three different things

Guests often mix up three charges, which is why the question of whether serviced apartments need deposits has no one-word answer. A booking deposit is paid in advance to secure the reservation and normally counts towards the bill. A security deposit or hold is separate: it exists to cover damage and extras and is meant to come back. The payment for the stay itself is the third, and some operators ask for it in full before arrival.

Mansley's terms show how these can sit side by side: payment in full is required before arrival for promotional rates, flexible bookings are paid 72 hours before arrival, a pre-authorisation can be placed on the card if payment has not arrived, and a separate security deposit is taken on arrival. If you only look at the first line of a confirmation email, you can miss the later steps.

Cancellation terms matter alongside deposits, because a deposit taken to secure a booking may be kept or applied to a cancellation fee. Quest's FAQ says cancellation fees are charged to the card provided or deducted from the reservation deposit. The guide to aparthotel cancellation policies covers the notice periods in detail.

How long does a hold or deposit take to come back?

It depends on the operator and on your card issuer, so no single figure applies. Lodgify says the length of a hold is set by the guest's card issuer and typically lasts between 5 and 10 business days, after which it is voided if the host has not captured the funds. That describes vacation rental practice rather than every serviced apartment operator.

Hotels often quote shorter times. In the Elliott article, a Marriott spokesman is reported as saying credit card holds are typically released within 24 hours of checking out. American Express Australia says a hotel pre-authorisation is usually reversed at checkout, and that a charge that does reach the account should be removed within 10 working days. A cash-style security deposit follows the operator's own refund process: one operator inspects the apartment first and refunds afterwards.

If a hold is still showing after the stated period, the practical order is to ask the operator whether it has released it, then ask your card issuer. Keep your checkout confirmation until the money is back.

Do longer stays change the deposit?

They can. Mansley's terms reserve the right to ask for a deposit on reservations of 14 nights or more booked on a flexible rate, which shows how stay length can change the terms. Other operators apply the same terms to every stay. Nothing in the terms read for this guide says a long stay always means a larger hold, so ask rather than assume. For weeks or months, the practical question is not only whether serviced apartments need deposits, but whether the deposit grows with the stay.

Do not confuse an operator's deposit with a tenancy deposit. When you rent a flat on a lease, the security deposit is a sum held for the landlord, and Wikipedia notes that many US states and cities regulate when a landlord can keep tenant deposits after move-out. A serviced apartment booking is normally a short-stay arrangement with the operator rather than a tenancy, so the rules and the paperwork can differ. If your stay is long enough that you are comparing the two, serviced apartment vs rental lease sets out the contrast, and monthly serviced apartments covers how month-long bookings work.

What to ask before you arrive

A short set of questions removes most surprises when you are deciding whether serviced apartments need deposits at your chosen property. Ask them before booking if the answer could change your choice, and again by email a few days before arrival. A long-stay accommodation checklist can hold the answers alongside the rest of your planning. Examples of cities where operators publish different terms include London, Edinburgh and Sydney, so check each property's own page rather than relying on a brand-wide assumption.

• Is a deposit or hold taken at all, and is it a hold or a payment?
• How much will be held or taken, and is that per apartment, per night or per stay?
• When is it taken: at booking, before arrival or at check-in?
• Which card is accepted, and are debit cards, cash or a different name allowed?
• What does it cover: damage, cleaning, smoking, extras or incidental charges?
• When is it released or refunded, and how will you be told?
• Can the property charge your card later for damage, and what evidence do they provide?